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Closing the Deal

CHAPTER 11

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Introduction

Closing the deal is the climax of the sales process. All your hard work in prospecting, discovery, demonstration, and proposal have led to this point. While closing is perhaps the most critical part of the sales process, it is also one of the hardest. There are many reasons that a sale, even when close to the finish line, may not close. This chapter will discuss strategies for dealing with objections, encouraging the customer to buy early, and getting the deal closed.

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Learning Objectives and Agenda

Develop strategies for handling customer objections.
Identify the best practices for negotiations with customers.
Utilize principles of buyer psychology when developing sales tactics.
Use micro-commitments to help customers on the road to purchasing.

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SECTION 1

Handling Customer Objections

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Steps to handling objections

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Step 1 - Use the Socratic Method

The root of a customer’s concerns are often different from what the customer initially expresses.
The first step in handling objections is using the Socratic Method to find the root of the objection.
Understand the customer’s concerns fully before you move on.

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Step 2 - Restate

Don’t assume that you understand the customer’s problem.

Restate the problem as you understand it, and ask the customer if you are correct.

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Step 2 - Restate (cont.)

Restating also ensures that the customer understands what the problem is.

Restating the problem forces the customer to ask themselves, “Is that really my concern?”

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Step 3 - Thank them

Thanking the customer creates a safe environment where the customer will express concerns in the future.

Thanking also offers a chance to show empathy.

Example: “Thank you for expressing your concern. I can understand why you might feel that way.”

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Activity: Practice steps 1-3

Partner with another student and choose any product or service that could be sold in a B2B setting.
Determine three different concerns that a customer might have about the product or service. The student acting as the customer will choose one of the three.
Then, practice the first 3 steps to (1) uncover the concern, (2) restate, and (3) thank them.
One student will act as the customer, one as the seller, then switch.
The conversation will start with the customer saying, “I am not sure if I am ready to purchase.” Then the seller will start with step 1.

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Step 4 - Resolve the objection

After determining the main concern, the final step is to resolve it.

There are different ways to do this, based on the different types of objection.

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Objections related to price

Price concerns result from not seeing enough value in the product to justify the cost. In these situations, you can:

1. Offer case studies

2. Discuss the beneficial outcome

3. Compromise on cost

4. Identify the core reason for the objection

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Objections related to price (cont.)

1. Offer case studies

Offer social proof of how other firms have benefited from your product or service.
When possible, use examples of firms that are similar to the customer’s.

2. Discuss the beneficial outcome

Shift the customer’s focus from product itself to the valuable outcomes of utilizing the product.

For example, rather than discuss what the product is (e.g., HR software) focus on the benefits (e.g., happier employees and less turnover).

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Objections related to price (cont.)

3. Compromise on cost

Ask the customer what their budget is. If it makes financial sense for you, see if you can come closer to their price.
You can also offer less services or a cheaper package.

4. Identify the core reason for the objection

Often customer’s concerns are like an iceberg.
They may use price as an excuse for another concern.

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Objections related to the product or service

Concerns about the product or service generally fall into 3 categories:

1. The customer does not see how you are different from competitors.

2. The customer does not see the need to fix their problem.

3. Customers are skeptical about whether your product is as good as you have made it seem.

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1. The customer does not see how you are different from competitors

In these situations:

Often the prospect has multiple offers from competitors, but the offers are like comparing apples to oranges.
Help the prospect sees the difference in the offers and why you are distinct.

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1. The customer does not see how you are different from competitors (cont.)

Focus on social proof to show the value above the competition.

“Chen, that is a great question. Before we started working with Leroy at [client firm] they had similar questions about the difference of our bid compared to the others. However, they ultimately decided to partner with us because they felt we were the best fit for their needs. Leroy saw how we helped others reduce turnover by 23% and saw how beneficial that would be for their business. They have never looked back. If I can show you specifically what we did for them, would you be open to learning more??”

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2. The customer does not see the need to fix their problem

In these situations:

Use ponder questions to help the customer see the need to fix the problem. Help the customer “feel the pain of the problem.”
Ask questions such as “What will happen if this problem isn’t fixed? What problems is this causing your business? How much do you think this is costing your company?”

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3. Customers are skeptical about whether your product is as good as you have made it seem

In these situations:

Offer proof with case studies of past customers that you have helped.
Offer a reference. Ask one of your best customers if they will serve as a reference, then give their contact information to potential customers who are unsure if your product is good.

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Objections where the seller is putting off a decision (being non-commital):

In these situations, you can:

Be up-front with customers and ask them if they think the product is a good fit for them. Tell them it's okay if the answer is no.
If you think that the customer truly is interested but is feeling nervous about making a decision, give them the time that they need but make sure to schedule a follow-up.
Remember: don’t waste your time chasing customers who are not interested.

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General tips for resolving concerns

Strategy 1: Answer with a question

If the buyer asks you a question that you don’t immediately have an answer to, you can respond with a question.
Using this strategy gives you more time to think of an answer.
And it helps you better respond to the question by using the incremental information gained from the customer.

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General tips for resolving concerns (cont.)

Strategy 1: Answer with a question - Examples

If a customer asks, “How much does it cost?” you might respond by asking, “That depends… how many people in your organization will use the service?”

If a customer asks, “What is your best feature?” you might respond by saying, “That’s different for everyone. What would you say is your biggest challenge?”

If a customer asks, “What makes you better than our current vendor?” you might anwer, “They are a great company. What was it that made you choose them 3 years ago?”

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General tips for resolving concerns

Strategy 2: If, Then statements

Sometimes you may not fully resolve the customer’s concern in the meeting to the point that they are ready to commit.
The customer may need time to think about it or may still disagree.
Rather than going around in circles when it is obvious that further discussion will not be productive, you can use “If, then” statements.
These statements ask the customer to commit if their concern is resolved.

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General tips for resolving concerns

Strategy 2: If, Then statements - Examples

“If I could demonstrate the superiority of our product in the next meeting, then would you be willing to purchase?”

“If I send you the details about an independent study that shows our service is faster than our competitors, then would you schedule a demonstration?”

“If I can get our product down to the price you asked, then would you be willing to sign a contract?”

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Activity: Practice all the steps

Partner with the same student from the previous activity and use the same product.
Discuss how you can resolve each of the three concerns (price, product, and decision-making).
Then, practice the 4 steps - (1) uncover the concern, (2) restate, (3) thank them, and (4) resolve the concern.
One student will act as the customer, one as the seller, then switch.
The conversation will start with the customer saying, “I am not sure if I am ready to purchase.” Then the seller will start with step 1.

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Storytelling in Sales

People retain more information from stories because stories create an emotional connection.
Often salespeople try to justify their product with logic only, but good business decisions are made with both logic and emotion.

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Storytelling in Sales (cont.)

Logical explanations - “This feature allows you to print from your phone. It comes with the standard package.”

Using emotions and logic - “Have you ever found yourself reading something on your phone, but unable to print it because you’d have to go back to your desk, find the document in your email, and then send it to the office printer? Most of us use our phones for almost everything. Why shouldn't we be able to print directly from our phone when we're reading something? That's exactly what our product can do. This simple feature alone has saved others many hours over the past year.”

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Storytelling in Sales (cont.)

Make your customer the story’s hero

Your product/company is not the hero, but the “guide.”
Your story should focus on the customer as the hero.

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Storytelling in Sales (cont.)

Make your customer the story’s hero: Example

“One of our clients, an HR Director in the manufacturing space, had a huge issue with the accuracy of his workers logging in and out with the current manual timesheet. The numbers were inaccurate and team members were not diligent with correcting their times. This led to an increase in payroll expenses and the company lost thousands of dollars each pay period. To fix this, he researched HR software and started talking with us. He implemented our system and saw a 5% decrease in expenses each pay period.”

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SECTION 2

Negotiation Tactics

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Negotiation Tactics

In a negotiation, each side brings their most important priorities and then compromises so that each party can get what is most important.
Much of a salesperson’s job is negotiation. The salesperson ensures that the company’s priorities are accounted for while making sure that the customer is also happy.

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Best practices for effective negotiation

Listen more than you talk

Your role as a salesperson in a negotiation is to find out what items are most important to a customer, and then compromise to the extent possible. You can’t always give the customer everything they want, but you can often give them their top priorities.
You can only give them their top priorities if you ask questions and then listen carefully to their response.
Use the Socratic Method to ask enough questions that allow the customer’s top needs to surface.

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