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Hierarchy of Buying
I SURVEYED MORE than 1,000 business owners to ask “Why do you buy?” See Figure 1.1.
When the need arises, customers buy first from people they know, trust, and like. The higher on the pyramid you are with your market, the less competition you have. We take it from the top down:
• Current satisfied customer: Obviously, people are going to buy from you if they already do and are satisfied. The key term here is “satisfied.” Even though customers are current, this doesn’t mean they are happy.
• Referral by a trusted source: The first thing I do when I need something I don’t already have is to ask people I know and trust if they know of a provider, which is easy with sites like Facebook and Twitter. I can get a pile of recommendations in minutes. Are you on the tip of the tongue when someone asks for recommendations within your industry? 
Figure 1.1 Hierarchy of Buying: Service-Based Business
• Current relationship but have yet to purchase: Potential customers know you, trust you, but have yet to buy. And that’s okay. The key here is that when they have the need for your product or service, you are in the front of their minds.
• Recognized expert in the field: You’ve built a platform and are consistently in front of potential customers with helpful advice and tips that relate to your industry. You want your market to say “This guy/girl knows what they’re talking about! I need to learn more about them.” If done right, this leads them into “current relationship” status above.
• Search through ads, random searches, and so forth: We get close to the bottom of the barrel here. Potential customers don’t know anyone who provides the service, never met anyone, so they randomly search for a business that can help. You’re not only at the mercy of a search engine here; price now becomes a huge decider to the point that you almost become a commodity seller. You don’t want to be here.
• Cold call: Most of your market isn’t sitting around saying “You know, I need an accountant to help my growing business, I’m just going to sit here until someone randomly phones me to offer me that service!” Cold-calling is time-intensive with horrible results. Companies encourage it because it has a “low cost” up front, but what’s the cost of annoying 99 people in a row to potentially talk to someone who may hire you based on no trust and price alone? I’m starting a movement to change the phrase from “cold-calling” to “telespam.” That will put a stop to the courses; no one is going to sell an e-book about “The Top 10 Ways to Better TeleSpam!”5
So the question is simple: Where on the pyramid are you focusing your marketing efforts? The lowest point with high competition and low margins? Or the middle while aiming to get to the top?
The main reason people don’t focus on the middle is because it takes time. There, I admitted it. Building trust takes time. Fostering relationships takes time. So if you’re looking to make the quick buck, go ahead, slide into the greasy bottom level, and enjoy. Just take a shower after.
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