This is “Handling Objections: The Power of Learning from Opportunities”, chapter 11 from the book Powerful Selling (v. 1.0).
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You heard Paul Blake talk about making a successful presentation in Chapter 10 "The Presentation: The Power of Solving Problems". Now hear his tips about handling objections. While this might sound like the most difficult part of the selling process, Paul shares his advice about how to make this the most productive part of the selling process.
If you think you have to memorize all kinds of responses to objections, you’ll be pleased to hear that handling objections is easy…when you use the skills you already learned.(click to see video)
You’ve been working really hard at school, and it’s paying off. You’re doing well this semester with a GPA right where you want it. Spring break is right around the corner, and you and your friends have been talking about going to Mexico. You even had an impromptu “fiesta party” at your place and even do some research about airfares and hotels; there are some great deals out there. You present your case to your parents and end with a strong “close” to seal the deal: “The timing is perfect since it’s my senior year. I can book the flights tonight online.” You thought you sold them on the trip when they say, “We’re worried about you going out of the country without a chaperone.” You are deflated, but you won’t take no for an answer so you wait for a moment, let it sink in, then deliver your response, just like you planned. You have just experienced the fine art of overcoming objections.
Since you are constantly selling in your everyday life, you have also undoubtedly encountered objections: your friend doesn’t want to see the same movie as you, your brother doesn’t want to share the car, your parents want you home earlier than you would like. When you attempt to convince someone or “sell” him on your point of view, you are not always successful. But each time you “sell” your idea, you usually have additional information or a fallback position so that you can get what you want while meeting the other person’s needs. You are probably more skilled in overcoming objections than you realize.
Occasionally in your sales career, you will encounter a situation in which you are able to close the sale directly after giving your sales presentation. Such a situation, however, is the exception not the rule. Objections are simply a natural outcome of the sales process. Each potential prospect has his own set of unique needs, and, though you may identify most of them during the preapproach stage of the selling process when you do your research, you will not be able to anticipate all of them. After all, you are not a mind reader. Besides, if all it took to excel in sales was to deliver a perfect script, anyone could do it. But that is not the case. The essence of sales is handling objections and truly understanding how you can help your prospect meet her needs. It is a demonstration of your skills as a salesperson to find the opportunity in these objections, listen to your prospect, and then respond. So an objection is simply a question from a prospect that indicates that she wants more information. If she weren’t interested, she wouldn’t be asking questions.John Boe, “Overcome Objections and Close the Sale,” Agency Sales, September 27, 2003, http://www.johnboe.com/articles/close_the_sale.html (accessed May 16, 2010).
The first myth to dispel is the assumption that objections are bad or an omen foreshadowing failure. On the contrary, resistance usually portends commitment. If a prospect is asking you questions, you can at least assume that he is interested in your product or service. In fact, in all likelihood, he already knows whether or not he needs or wants to make the purchase. Thus, the reason he is objecting isn’t necessarily because your presentation failed to communicate the features, advantages, and benefits of your offering. Rather, he is objecting because he is seeking reassurance; he is on the fence of indecision, and he wants you to provide him with the incentive that justifies an immediate purchase.R. T. Edwards, “Power Selling,” American Salesman 38, no. 3 (March 1993): 13. Supply your prospect with the right information, that is, show him why he wants to buy your product or service.
Objections are not rejections but are invitations for more information that eventually leads to a yes.
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ObjectionsProspect questions or hesitancies about a product or company., also called sales objections, are generally defined as prospect questions or hesitancies about either the product or company.William C. Moncrief and Greg W. Marshall, “The Evolution of the Seven Steps of Selling,” Industrial Marketing Management 34, no. 1 (January 2005): 13–22. While objection may sound like rejection, you should never assume that when a prospect asks a question or expresses a concern that you have failed to generate interest in your product or service. It is true sometimes that your prospect will object when he truly cannot or does not want to buy. Usually, though, objections mask—intentionally or unintentionally—a request for more information. They simply signal your prospect’s level of interest and alert you to what actions need to be taken to bring the sale to a close. If your prospect expresses objections, consider them invitations to continue to sell. Furthermore, leverage these objections into an opportunity to continue to build your relationship with your prospect so that you can continue to create a positive influence on the buyer’s decision. The fact is objections help you build your relationship and find the true reason for resistance. Think of objections as opportunities.
As an analogy, consider asking someone out on a date for the first time. Even if you have hooked him in with a great pick-up line (approach) and dazzled him with your sparkling personality (presentation), he may still not be convinced that you are serious about him. Naturally, he might respond by playing hard-to-get. How you react will reveal to him your level of commitment. By allowing the relationship to grow slowly and organically, you demonstrate your patience, sensitivity, and sincerity. You establish a foundation of trust that eventually wins him over. On the other hand, if you respond by getting huffy and stomping off, he will probably be glad to see you go.
You might not keep track of objections in your everyday life (especially as they relate to dating). However, you may find it interesting to know that in sales, a prospect will say no an average of five times before he buys.John Boe, “Overcome Objections and Close the Sale,” Agency Sales, September 2003, http://www.johnboe.com/articles/close_the_sale.html (accessed May 16, 2010). That means that it’s more likely than not that you will experience a prospect who poses at least one objection: asking a question, requesting more information or time, or pushing back due to financial constraints. Without objections, you would have no way of knowing what a prospect is thinking, what concerns she has, or what barriers might be in the way of her saying, “Where do I sign?”
The fact is objections are an important part of the selling process. But thinking about overcoming objections might be the wrong frame of reference. The word “overcome” implies that you want to conquer, fight, or win (and, therefore, your prospect loses).Patty Morgan-Seager, “Handle Objections and Have Fun!” Multifamilypro, http://www.smmonline.com/Articles_handleobj.htm (accessed October 24, 2009). Instead, it’s best to think about objections as a perfect extension of the selling process. Think back to the steps of the selling process that you have covered so far: prospecting and qualifying, preapproach, approach, and presentation. Throughout each of these steps, your focus is on understanding your prospect’s needs and building a relationship based on trust. The same is true for this step: handling objections. This is all about learning more, finding common ground, and providing the solution that is best for your prospect. Objections and conversation help you better understand exactly what your prospect wants and needs. The bottom line is that you don’t want to avoid objections; you actually want to encourage objections and ask for them. According to the Selling Power Sales Management Newsletter, “Objections are not personal attacks; they’re gifts.”“Hug Your Objections,” Selling Power Sales Management Newsletter, August 15, 2007, http://www.sellingpower.com/content/newsletter/issue.php?pc=732 (accessed March 16, 2010).
If objections are such a positive part of the selling process, you might be wondering how to be prepared for them; how to think about them; how to consider them even before you get them. Here are some strategies for preparing for the objections portion of the selling process that will help you build your relationship.
Objections should not intimidate you or dissuade you from continuing the selling process. Rather, you should consider objections opportunities to learn more about your prospect’s needs. The more you understand about your prospect’s needs, the greater your ability to determine how your product or service can satisfy them or how your product or service can be improved to satisfy them. Remember, selling is about solving problems. The solution that you offer will demonstrate to your prospect whether or not you truly understand his needs and whether or not you have his best interests at heart. By embracing your prospect’s objections and handling them effectively, you will inspire his trust, confidence, and most important, loyalty. As a result, both you and the prospect benefit.
Handling Objections: All in a Day’s Work
At iCore Networks, a leading VoIP (voice over Internet protocol) provider, handling objections is an everyday learning experience. Sales reps gather at 8:00 a.m. sharp every day to discuss successes and failures from the previous day and role-play overcoming objections and then put what they learn to work in the field all day. The commitment to coaching and being in front of customers works for the company and its sales force: the average compensation for a first-year sales rep is $92,000.Mike Hofman and April Joyner, “A Salesforce Built around Cold Calling,” Inc., September 1, 2009, http://www.inc.com/magazine/20090901/a-sales-force-built-around-cold-calling.html (accessed November 22, 2009).
Learn more about how iCore sells in the following article.
While prospects may voice their objections in different ways, just about every objection comes down to one of four reasons: no or not enough money, no perceived need, no sense of urgency, and no trust.John Boe, “Overcome Objections and Close the Sale,” Agency Sales, September 2003, http://www.johnboe.com/articles/close_the_sale.html (accessed May 16, 2010). As a selling professional, you have control over each one of these objections. But it’s too late if you address it only when the prospect objects. In other words, you are actually handling objections at every step of the selling process. For example, you can avoid the price objection with thorough qualification during your first step of the selling process.Joan Leotta, “Overcoming Doubts: The Road to a Sale Is Blocked by the Prospect’s Doubts,” Selling Power 20, no. 2, http://www.sellingpower.com/content/article.php?a=5351 (accessed March 16, 2010).
If a prospect does not have a perceived need or high sense of urgency to buy your product or service, your challenge is to understand the drivers of his business. Every business has challenges, and your role from the time you qualify the prospect is to understand your prospect’s “pain points,” those issues that cause problems for him and his company and present barriers to growth. If you truly understand your prospect’s business, it is much easier to present a solution that addresses the perceived need and reasons to buy it now. “There is no reason for buyers to buy today unless we build in that sense of urgency and give them a reason to buy today,” says Dana Forest, director of sales at Simons Homes.William F. Kendy, “An Uncertain Situation: How to Kick-Start the Hesitant Buyer,” Selling Power 27, no. 9, http://www.sellingpower.com/content/article.php?a=7658 (accessed March 16, 2010).
Many objections are raised because the relationship between the prospect and the salesperson is not fully developed. business-to-business (B2B) selling is dependent on trust. If the trust is not there, or the relationship is not yet fully developed, it can be difficult for a prospect to make a change or finalize the purchase. If this is the case, prospects will frequently delay or stall before making a decision, which can be an attempt to derail the sale.
While you may not be able to predict your prospect’s every objection, you can at least predict that he will object. Knowing when to expect objections is the first step to handling them: you will eliminate the chance of appearing caught off guard or unprepared to discuss the product or service that you are selling.
Of course, it is possible that the prospect may object at any time during your sales call—from introduction to close. Still, there are specific points in time during the sales process where these objections are more likely to occur: when you are first trying to make contact, when you are making a sales presentation, and when you are attempting to close the sale, or make a trial close. As you learned in Chapter 10 "The Presentation: The Power of Solving Problems", a trial close includes any attempt to close the sale but usually focuses on asking the prospect’s opinion: “What do you think about the turnaround time?” A trial close may occur at any point during the selling process. In other words, if the prospect indicates that she may be interested in making the purchase, it is an opportunity to make a trial close.
Objections are likely to occur at several points during the selling process, including the trial close. It’s best to be prepared for objections at every step in the selling process, including the qualifying stage. Know your prospect and be ready to incorporate objections into your sales presentation.Jeffrey Gitomer, “Objection Prevention & Objection Cure,” video, May 18, 2009, http://www.youtube.com/watch?v=CgfmcuE_06w (accessed October 24, 2009).
Imagine that you are in the middle of a cold call and you are attempting to set up an appointment to meet your prospect. You have barely uttered your name when your prospect exasperatedly grunts, “Don’t waste your breath. I’m not buying anything you’re selling.” How do you respond?
This scenario is meant to illustrate the fact that you may meet resistance as soon as you try to establish contact with your qualified prospect. Hopefully, you will have reduced the rate of this problem occurring by properly qualifying your prospect beforehand and preparing for the most common objections. Nonetheless, anticipate resistance from the beginning.
Using the questioning technique is a good way to engage your prospect in conversation and learn more about what can help her run her business.“Telemarketing Tips about Overcoming Objections,” September 25, 2009, http://www.mindtools.com/pages/article/newTMC_88.htm (accessed October 25, 2009).
|Prospect:||No thanks, I’m satisfied with my current supplier.|
|You:||May I ask you who you are currently using?|
|Prospect:||We work with Advanced, and they have been doing a good job.|
|You:||Advanced is very good at what they do. Did you know that Symone offers a money-back guarantee? In other words, if you are not completely satisfied with the conversion or the service, we will completely refund your money. It would be worth thirty minutes of your time to learn more about it. How does Tuesday at 8 o’clock look?|
When you are giving a sales presentation, very often the prospect will ask you questions as you go. It is unlikely that your prospect will wait until you have finished your presentation before asking you questions. However, the experienced salesperson will actually encourage questions throughout her presentation since she knows that responding to them supplies her with precious time that she can use to further demonstrate how her offering can solve her prospect’s problem. As a rule, you will want to acknowledge objections as they arise. If you feel that the objection will be addressed at a later point during the presentation, you may postpone your response, but you will need to communicate this information to your prospect. For example, you might say something like the following:
|Prospect:||I’m a little concerned about the financing.|
|You:||I’m glad you brought that up. I’m going to address that in the next slide, which I think will provide you with the information you are looking for.|
Prospects may raise objections during the sales presentation.
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Otherwise, he may think that you are avoiding the question and that you are trying to hide something, are unprepared and do not know how to respond, or are simply not listening—all kinds of impressions that you do not want give.
Recall from Chapter 10 "The Presentation: The Power of Solving Problems" that you can test your buyer’s readiness after your sales presentation by employing a trial close. If your prospect hasn’t expressed any opinions at this point of the selling process, then the trial close is your opportunity to seek them out. If your prospect responds positively to it, then congratulations! This response indicates that you have skillfully executed each step of the selling process: creating rapport, gaining the prospect’s trust, listening, identifying his problem, and presenting products and services that will provide him with solutions and value.“Telemarketing Tips about Overcoming Objections,” September 25, 2009, http://www.articlesbase.com/sales-articles/telemarketing-tips-about-overcoming-objections-457823.html (accessed October 25, 2009). From this point, you can move to the next step of the process, the close.
If, on the other hand, an objection is raised, then you will use this time to respond to it. Always remember that an unacknowledged concern lessens the opportunity for a sale. Responding means fully listening to your prospect’s concerns and objections, asking clarifying questions to determine whether or not you understand them, identifying the types of objections they are, and meeting them. To be clear, “meeting” an objection does not mean saying what you think the prospect wants to hear; you should never make a promise about a product or service that you cannot deliver. How you meet an objection will depend on the type of objection you are dealing with. Simply put, meeting the objection means returning to the presentation stage, elaborating on your product’s capabilities, and emphasizing in what ways they benefit your prospect. For example, assume you are making a sales presentation for a software product to a B2B client and she presents an objection about the timing of the installation.
|Prospect:||This is really an interesting option for us to pursue, but we are planning on launching our service much sooner than your timeline suggests. I’m not sure your implementation timing will work for us.|
|You:||When are your planning on launching your new service?|
|Prospect:||We want to have everything in place and tested in less than forty-five days.|
|You:||So it sounds like the biggest challenge is the installation date. I can talk to our head engineer and see if we can change the installation date. If we can guarantee installation within thirty days, will you commit to the two-year agreement?|
In this example, it’s important to note that the objection led to the prospect sharing information that was not previously known: the date of the launch. This is valuable information that the salesperson can use to potentially overcome other objections and provide service that will help the prospect meet his goals.
After you think you have responded to and have overcome all your prospect’s objections, you can proceed with another trial close. If you determine that your prospect has new objections, then you will want to repeat the response process. You may have to use a trial close several times before moving to a close. Keep in mind that the sales process is not perfectly linear; rather, it is iterative. Depending on the prospect and the product, it is perfectly appropriate to repeat steps.
When you have handled your prospect’s objections, you have earned the right to ask for the sale.
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When you are certain that you have addressed all your prospect’s objections and that he has no further objections, move to the close. Don’t be shy! You have earned this right and, besides, your customer expects you to!
In the same way, you should never allow yourself to become defensive or antagonistic when a prospect makes an objection. Since your goal is to build and sustain an enduring customer relationship, you will want to handle your prospect’s objections with as much delicacy as possible. For example, avoid responding to objections with statements beginning with “but”: “But our company is better” or “But we offer more value for your money.”Keith Rosen, “Respond to your Prospect’s Objections,” AllBusiness, http://www.AllBusiness.com/sales/selling-techniques-active-listening/4019422-1.html (accessed May 16, 2010). It’s better to respond in a positive way, such as “We are the only company that offers a guarantee on our product. If you’re not satisfied for any reason, we’ll refund your money. Our goal is for you to be more than satisfied—we want you to be delighted.”
Learning how to handle objections is key, especially when many of the same ones occur regularly. There are six strategies that can help you handle virtually any objection.
1. View the objection as a question. Many times salespeople hear an objection as a personal attack. Instead, an objection such as “Why are your prices so high?” should be considered a question. That allows a more positive conversation rather than a defensive one.Pam Lontos, “10 Strategies for Dealing with Objections,” FrogPond, http://www.frogpond.com/articles.cfm?articleid=plontos12 (accessed October 24, 2009).
2. Respond to the objection with a question. As in every step of the selling process, asking the right questions is critical, and handling objections is no exception. Questions, such as “Can you share you concerns in this area?” or “Is there another way to look at this to make it work for you?” are good ways to engage prospects in dialogue that will help you better solve their problems.Keith Rosen, “Respond to your Prospect’s Objections,” AllBusiness, http://www.AllBusiness.com/sales/selling-techniques-active-listening/4019422-1.html (accessed May 16, 2010).
3. Restate the objection before answering the objection. It’s a good idea to check for understanding and demonstrate that you are listening by restating your prospect’s objection. For example, “So what you’re saying is you’re concerned about the capacity during peak periods” is a good way not only to acknowledge the objection but also to give you time to formulate your response.Pam Lontos, “10 Strategies for Dealing with Objections,” FrogPond, http://www.frogpond.com/articles.cfm?articleid=plontos12 (accessed October 24, 2009).
4. Take a pause before responding. Many times salespeople “oversell” when they are answering an objection. When a prospect raises an objection, stop, listen, and pause for a few seconds. This shows the prospect that you are legitimately listening to her objection, not just trying to sell.Felice Philip Verrecchia, “How to Identify and Overcome Objections,” Edward Lowe Peerspectives, August 11, 2004, http://www.bankseta.org.za/downloads/faisII/benefits/objections.pdf (accessed October 24, 2009).
5. Use testimonials and past experiences. Don’t avoid answering any part of an objection. In fact, objections are the perfect time to share testimonials. For example, “I have another customer who was concerned about the turnaround time. He found that not only were we able to deliver on time, we were slightly under budget.”Felice Philip Verrecchia, “How to Identify and Overcome Objections,” Edward Lowe Peerspectives, August 11, 2004, http://www.bankseta.org.za/downloads/faisII/benefits/objections.pdf (accessed October 24, 2009).
Testimonials can be very powerful at any point in your sales presentation but especially when a prospect presents an objection.
|Prospect:||I’m not sure this is the right database management tool for us. Technology is not our strong suit, and I’m concerned that we would be buying a product that has more horsepower than we need.|
|You:||I have several other clients with businesses that are about the size of yours, and they felt that way initially, too. In fact, John Jackson at Premier Services felt the same way, but he said that the product is so easy to use that it took very little time to train his people. He was able to increase his sales by 3 percent and reduce his sales and marketing costs by 5 percent when using our database management tool. Chris Ling at IBS was worried about the same issue. He increased his sales over 5 percent with an 8 percent reduction in selling and marketing costs. Let’s take a look at the demo again.|
You can also simply respond to an objection by letting your customers speak for you.Bob Bly, “Overcoming Objections,” http://bly.com/blog/general/overcoming-objections (accessed January 6, 2010).
|Prospect:||We’ve tried other cleaning products, but they didn’t really work for us.|
|You:||Here’s what my customers say…|
6. Never argue with the prospect. “The customer is always right” is always true when it comes to handling objections. It’s never a good idea to disagree or argue with the customer, even when he is wrong. Relationships are built on trust, so it’s best to use an objection to build the trust, not break it.Felice Philip Verrecchia, “How to Identify and Overcome Objections,” Edward Lowe Peerspectives, August 11, 2004, http://www.bankseta.org.za/downloads/faisII/benefits/objections.pdf (accessed October 24, 2009).
The following are things you should concentrate on doing when you are handling objections:
The following are things you should avoid doing when you are handling objections:
Reprinted with permission from Edward Lowe Peerspectives.Felice Philip Verrecchia, “How to Identify and Overcome Objections,” Edward Lowe Peerspectives, August 11, 2004, http://www.edwardlowe.org/index.elf?page=sserc&storyid=6407&function=story (accessed October 24, 2009).
Prospects may object for any reason, but there are six major categories into which most objections fall. When you are prepared for all these types of objections, you will be able to successfully handle them.
Sometimes prospects voice an objection as it relates to the product, called a product objectionA concern voiced by the prospect relating directly to the product.. Comments such as “This isn’t as good as your competitor’s product” or “I don’t want to take that kind of risk” are a reflection of a concern about the performance of the product. For complex purchases, prospects may not fully understand all the functions of the product due to lack of familiarity. Listening is an important skill to use, especially when a prospect voices a product objection. It’s a good idea to handle product objections by describing warranties, using testimonials, getting the prospect engaged in a product demonstration, or presenting industry or third-party research to support your claims.Charles M. Futrell, Fundamentals of Selling: Customers for Life through Service, 10th ed. (New York: McGraw-Hill Irwin, 2008), 385. For example, consider the following:
|Prospect:||I’m not sure your product stacks up to your competition.|
|You:||So what you’re saying is you are not convinced that this product will perform as well as others on the market? I’m glad you brought that up. I have customers who felt the same way when I began talking with them. Now they actually speak for the product themselves. Let’s take a look at these three short videos from some of our current customers talking about the product performance and how much better it is than that of the competitors.|
The Edge That Works
How do you compete with the big players in a crowded business-to-business (B2B) industry? Bob Ladner, founder and president of a market research firm in Florida, wanted to compete with the big players but couldn’t get any prospects to give him a chance. Finally, in the middle of a sales presentation when he was overcoming objection after objection, he asked the prospect, “What do you want? A guarantee?” While it’s almost impossible to offer a guarantee in the market research business, Ladner ultimately designed one that works. His successful firm now boasts major clients thanks to the guarantee. “The guarantee is a method of generating confidence,” says Ladner.Leslie M. Schultz, “Guaranteed Advantage,” Inc., June 1, 1984, http://www.inc.com/magazine/19840601/7042.html (accessed October 24, 2009).
Some prospects voice objections about the company or about doing business with you as a salesperson. This is called a source objectionA barrier presented by the prospect relating to your company or to you.. While this type of objection doesn’t happen often, it does happen so it’s important to know how to handle it.
Source objections as they relate to the company may be voiced with comments about the stability or financial health of the company or about how the company does business. But this is an opportunity for you to help your prospect understand your company’s strengths. Consider the following example:
|Prospect:||Your company hasn’t been around for very long. How can I trust that your company will be here in three years to support the warranty?|
|You:||I’m glad you brought that up. I can see why that might be a concern for you, but let me give you some information about the company that I think will put your mind at ease. Our company is backed by some of the largest investors in the industry. The reason they invested in the company is because they see the vision of how we can bring more solutions to companies like yours. They have made a commitment to support all customer warranties for the next ten years. Talk about putting your money where your mouth is. The bottom line is that we are trying to reduce your risk.|
When a prospect has a source objection as it relates to you as a salesperson, it might not be as obvious to overcome. As with other objections, the best way to handle it is to get it out in the open:Charles M. Futrell, Fundamentals of Selling: Customers for Life through Service, 10th ed. (New York: McGraw-Hill Irwin, 2008), 386
|Prospect:||I don’t think we would make this purchase from you.|
|You:||I can respect that. May I ask you why?|
One of the most common objections is the price objectionA concern voiced by the prospect about the perceived value of a product or service.. It is important to ask probing questions to really understand the nature of this objection. Many prospects use the price objection as a negotiating ploy to determine how much flexibility there is in the pricing, while others use it as a way to object due to budget constraints. It’s best to always be prepared for the price objection. The bottom line on the price objection is that people buy when they see the valueThe worth that a product or service provides to a customer.. Cost (or price) is what the customer actually pays for the product or service. Value is the benefit that the customer receives from the product or service. It is value that customers assign to a product or service that determines the price. For example, value is what dictates that a shack on the beach in Monterey, California, is worth more than a similar home in Omaha, Nebraska. Or in another example, value is what causes customers to pay more for an iPod than a comparable MP3 player. Customers perceive that the design and function of an iPod delivers more value, even at a higher price, than comparable products made by other manufacturers. This is the essence of value.
“The customer is typically going to throw the price objection out there just out of habit, out of rote,” according to sales trainer Chuck Reeves. When salespeople really listen to customers, Reeves says that they actually hear customers saying, “I don’t see the value, and if you can convince me there is value, there is return, then I just might pay.”Rick Weber, “How to Overcome the Price Objection,” Trailer/Body Builders, January 1, 2003, http://trailer-bodybuilders.com/mag/trucks_overcome_price_objection (accessed November 7, 2009). Even when budgets are tight, companies make adjustments to purchase the products or services that they find compelling and can help them profitably grow their business. If you think about it, the same is probably true for your personal purchasing; when you want something bad enough, you are able to somehow find the money for it.
Many salespeople believe that price is the barrier standing in the way of making a sale. That is, they think that cutting the price will help them get the sale. Many times salespeople are willing to cut the price or a product or service when a prospect objects because they feel that if the product or service is priced lower, they will get the sale. This situation is sometimes compounded if the salesperson rationalizes cutting the prices because she believes the margins are high enough, or even too high. This “sense of fairness” approach never recognizes the value that the product or service brings to the prospect. If simply reducing the price were the answer, selling would be easy—and probably wouldn’t require your skills and intuition.
The truth is that price is not the driving factor in most purchasing decisions. More important, pricing shouldn’t be determined based on your product cost. To be successful, you need to understand more about the value your product or service is delivering to the customer. It’s the value that should determine the price, not product cost, or even prospect objections.Tom Reilly, “What Is a Fair Price?” Tom Reilly Training, http://www.tomreillytraining.com/CPO%20article%205.htm (accessed November 11, 2009).
So be prepared for the price objection. Preparation will make you look at the product or service through the eyes of the prospect and will help you establish the value. The price objection might be handled in the following way:
|Prospect:||Your prices are much higher than anyone else I’ve looked at.|
|You:||So what you’re saying is you think that our prices are higher than others? Certainly, price is part of the equation, but it’s also important to look at the value for the price. You mentioned that real-time inventory information was an important strategic issue for your business. Ours is the only product on the market that provides real-time inventory information without any integration costs. Our system is a true plug-and-play application so you can begin getting real-time inventory the day we sign the deal. In fact, one of my customers was concerned about the same thing, and now we provide his entire backend logistics.|
Handling the Price Objection(click to see video)
This video, featuring best-selling author and sales expert Jeffrey Gitomer, discusses how to handle the price objection.
Timing is everything when it comes to objections. While a prospect may raise an objection at any time during the selling process, it’s best to keep the pricing discussion until the end of your sales presentation rather than discussing it early on. (In fact, the same is true about salary when you are on a job interview—always postpone the conversation about salary until an offer is made.) The reason for this is simple: it gives you the opportunity to talk about value rather than price.
It’s easier to overcome the price objection when value has already been established in the prospect’s mind.
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Think about the process of buying a new car. First, you go into the showroom and talk to a salesperson, then you go for a test drive and really fall in love with the car—how it handles, the smooth ride, the sound system, the GPS system, the smell of the leather seats. While you probably looked at the sticker price before you got into the car, you don’t really start talking about price until after you determined that this car has what you want. At this point, the value has been established, which makes it easier for the salesperson to sell on value than to simply sell on price.Lance Baird, “Overcoming the Price Objection,” B2B Insights Blog, October 1, 2009, http://www.godfrey.com/blog/post/2009/10/01/276 (accessed November 7, 2009).
An objection that is related to the price objection is the money objectionA concern voiced by the prospect that relates to the budget or financial ability to make the purchase., sometimes called the budget objection, which relates to the prospect’s financial ability to make the purchase. While some budget objections are true, when the prospect really doesn’t have the means to purchase the product or service, it’s important to avoid these types of objections with proper qualifying.
Even if you do your homework before you begin the selling process, there is still a good chance that a prospect may present a money objection. In some cases, the prospect’s budget may not be large enough to accommodate the cost of your product or service. If this is true, you may determine that this is a prospect for the future when his business is large enough to afford your offering. However, it is worth probing to determine if the objection is price or budget related. Like the price objection, this objection is also related to value. When prospects can’t see the value for the price, they object by saying either the price is too high or they can’t afford it. The best way to handle it is to anticipate it and be prepared:
|Prospect:||I really can’t afford this right now.|
|You:||You mentioned that you are already paying $5,000 per month on your current plan. This plan even gives you a broader service at a lower cost per transaction cost. If you continue with your current plan, you will actually be paying a higher cost per customer. The fact is you really can’t afford not to switch. Let’s try this service for thirty days, and I can prove to you that your cost per transaction will be lower.|
In this example, the broader service, which results in a lower cost per transaction, is what establishes the value in this example. It’s the value that allows the salesperson to handle the money objection and make a trial close.
Another approach to this objection is to help the prospect see how they can afford your product or service. Consider the following example:
|Prospect:||We really can’t afford this in our budget right now.|
|You:||It sounds like this can really help you increase your sales. If I can show you how this product can pay for itself, would you be interested?|
Want to be able to handle objections with ease? Deliver value. When prospects object with price or money objections, differentiate your product with a value-added service. If you want to know which service will make a difference—and help make the sale—just ask your customers. You’ll be surprised what you learn when you just ask.Jack Carroll, “Your Price is too High—Not!” Inc., December 7, 1998, http://www.inc.com/articles/1998/12/14304.html (accessed November 22, 2009). This article by Jack Carroll from Inc. will help you think differently about handling the price or money objection.
Many times prospects will object with what is called the “I’m already satisfied” objectionA barrier presented by the prospect that indicates that there is no need for the product or service. (also called the need objection). This can be a more challenging objection than price because it might include a hidden objectionAn objection that is not openly stated by the prospect but is an obstacle in the way of making the sale., an objection that is not openly stated by the prospect but is an obstacle in the way of making the sale. In this situation, a prospect doesn’t state his concern about making the purchase. Instead, he might ask trivial questions to avoid the issue or he might not ask any questions at all and simply state that he does not have a need for the product or service.Charles M. Futrell, Fundamentals of Selling: Customers for Life through Service, 10th ed. (New York: McGraw-Hill Irwin, 2008), 378. The best way to handle hidden objections is to bring them to the surface. In other words, ask questions to get your prospect to talk openly about her objections. If she says no simply continue to ask questions until you are able to identify the true objection.Pam Lontos, “10 Strategies for Dealing with Objections,” FrogPond, http://www.frogpond.com/articles.cfm?articleid=plontos12 (accessed October 24, 2009).
Anticipation is best to avoid the “I’m already satisfied” objection. According to sales maven Jeffrey Gitomer, engaging the prospect is key. He preaches that there is a huge difference between customers being satisfied and being ecstatic and profitable. The secret is in engaging the prospect and talking about the value that other customers have received. According to him, when a prospect is satisfied with their current supplier, it’s the perfect time to make a sale.
Is Being Satisfied Good Enough?(click to see video)
That’s the question to ask prospects if they use the “I’m already satisfied” objection, according to this video featuring Jeffrey Gitomer.
While the “I have to think about it” objectionAn objection that is actually a stall. might sound like an objection, it is actually a stall. This “objection” usually occurs when a prospect isn’t completely comfortable with you and your product or service. This is the classic stall tactic and is a signal for you to build your relationship. Prospects usually use this objection when they are trying to mask some fear or risk that they have about committing to the sale. Your challenge is to uncover the risk that the prospect sees and build your relationship with him to build a deeper trust.Jeffrey Gitomer, “I’d Like to Think about It—and Other Sales Stalls,” video, June 22, 2009, http://www.youtube.com/watch?v=cCyf8af78A8&feature=related (accessed October 24, 2009). Just as with other objections, asking questions is important to understand why the prospect is stalling and what kind of information will help him feel more comfortable. In reality, this objection is one that is a signal for you to work on improving your relationship with the prospect:
|Prospect:||I need some time to think about it.|
|You:||I want to give you the time you need to think about it. But let’s talk specifically about your reasons for buying now versus later.|
This type of approach will help you engage the prospect in conversation so you can understand more specifically what the barriers are to the sale.
Ultimate Stall(click to see video)
This video, featuring Jeffrey Gitomer, highlights how to deal with the “I have to think about it” objection.
It’s exciting to get a call to go on a job interview. During your preparation (described in detail in the Selling U section of Chapter 10 "The Presentation: The Power of Solving Problems"), you will, of course, research the company and learn everything you can about how it does business. You’ll identify some questions that you want to ask because you realize that a job interview is a two-sided exchange—the company wants to learn about you, and you want to learn about the company. You’ll plan your wardrobe, transportation, and other details well in advance of the big day. But one thing you may not think about is how to overcome objections during the job interview.
Be prepared to answer the most common objections that may be voiced during your interview. Focus on the positive and keep your answers professional. In fact, you should practice your answers to these questions out loud so that your answers are crisp and conversational. When an interviewer presents an objection, take a breath before you answer the question. Restate the objection and then answer it. It’s best not to dwell on an objection and talk too much, simply handle them and move on.Randall S. Hansen and Katharine Hansen, “Closing the Sale and Overcoming Objections in the Job Interview,” Quintessential Careers, http://www.quintcareers.com/printable/interview_objections_closing.html (accessed October 24, 2009). Here are some common objections and suggested ways to handle them.
The best way to anticipate and even avoid this objection is to review your portfolio during the interview (see the Selling U section of Chapter 6 "Why and How People Buy: The Power of Understanding the Customer" for more details about preparing your portfolio).Randall S. Hansen and Katharine Hansen, “Closing the Sale and Overcoming Objections in the Job Interview,” Quintessential Careers, http://www.quintcareers.com/printable/interview_objections_closing.html (accessed October 24, 2009). A portfolio is a visual way to demonstrate your skills and experience. It’s one thing to talk about what you’ve done, it’s quite another to bring it alive to your interviewer. It’s especially important to show your work from internships, major class projects, volunteer projects, and other examples of your work.
This is another opportunity to refer to your portfolio by talking about projects that you work on with other people. Chances are you’ve worked on teams for class projects, internships, volunteer projects, and other areas. Be prepared with specific examples about how you have worked in collaboration with a team or taken on the leadership role within a team.Randall S. Hansen and Katharine Hansen, “Closing the Sale and Overcoming Objections in the Job Interview,” Quintessential Careers, http://www.quintcareers.com/printable/interview_objections_closing.html (accessed October 24, 2009).
Your response to this objection should be something like “Salary is only one part of compensation. I’m looking for the right opportunity, and I’m willing to look at other areas of the total compensation program, including benefits, advancement, exposure, and other elements of my personal and professional growth.” It’s best not to take this conversation into a salary discussion. Wait to have the salary conversation until the company has extended an offer. It’s a good idea to have a salary range in mind before you go into an interview. Do your research on Web sites such as Salary.com so that you are prepared if your interviewer asks how much you are expecting as a starting salary.Mary Moss, “Tips for Overcoming Objections during a Job Interview,” Associated Content, August 13, 2007, http://www.associatedcontent.com/article/337859/tips_for_overcoming_objections_during.html?singlepage=true&cat=31 (accessed October 24, 2009).
When you are starting out, it will be rare to hear that you have too much experience for a particular position. However, if you do hear it, be ready with the right answer. It’s always best to seek a job you really want. But starting at a level that might be below your expectations is a good strategy, especially in this economy.
When interviewers say this, they are worried that when the job you want comes along, you will leave. Answer this objection by pointing out that you are willing and excited about learning about the business from the ground up. Based on your research of the company, give your interviewer a specific reason about why you want to work for that particular company. People are more willing to give you a chance if you are really interested in working for the company.
Although there are some common objections you may hear in a job interview, chances are you will rarely hear an objection on a job interview. This is one major difference between a sales call and an interview. Most managers and recruiters respond during an interview in a more neutral way so as not to imply that the job is going to one candidate over another.Kim Richmond, Brand You, 3rd ed. (Upper Saddle River, NJ: Pearson Prentice Hall, 2008), 188. Prospective employers prefer to interview all the candidates and then make their hiring decision. Therefore, their objections are often more like hidden objections, those that are not openly stated during the interview. Unlike the sales call, it is not appropriate to keep probing to identify the objection. The best way to overcome objections, hidden or stated, is to be prepared to sell yourself in the most compelling way possible.
The concept of value, described earlier in this chapter, can be a successful way to overcome objections in a job interview whether the objections are stated or hidden. Prepare for the interview, understand the company’s needs, and demonstrate how you can meet the needs. Simple. Effective. Powerful.
After you’ve shaken hands and finished your interview, keep in mind that your ability to stand out is not over. Follow-up is the currency of sales; those who follow up significantly increase their chances of getting the sale (or getting the job). Here are some ways to follow up and make yourself memorable.
Prospective employers want people who want to work for the company. A thank-you note can set you apart from other candidates and show your interviewer that you really want the job (it’s easy for every candidate to say she wants the job, but not every candidate writes a thank-you note).
You have the opportunity to say thank you more than once. It’s also a good idea to take advantage of every opportunity to demonstrate your interest and enthusiasm for the company. Start with a thank-you e-mail that you send the day of the interview. It’s important to use e-mail to thank your interviewer for his time, and it is also is the perfect way to deliver value. Take a minute and recap some of the topics you discussed with each interviewer (if there was more than one). Jot down a list and go online and look for an article, video, or interesting blog that would be worth sharing. Send a personal thank-you e-mail to everyone with whom you interviewed (no group e-mails here). Also, be sure to send a thank-you e-mail to the recruiter, if you worked with one to get the interview. It’s important to remember that a thank-you e-mail should be as formal and professional as a handwritten thank-you note.
Now, it’s time to write your thank-you e-mail. There are three major parts to a thank-you e-mail. It can be short, but effective.
See Figure 11.5 "Sample Thank-You E-mail" for a sample thank you e-mail. Additional sample thank-you e-mail notes can also be found at http://jobsearch.about.com/od/thankyouletters/a/thankyouemail.htm.
Figure 11.5 Sample Thank-You E-mail
Take the time to send a personal handwritten thank-you note within twenty-four hours to everyone with whom you interviewed.
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Sending a thank-you e-mail is good etiquette, and it reminds your interviewer that you can deliver value to the organization. But don’t stop there. As soon as you send your thank-you e-mail, write a handwritten thank-you note to each person with whom you interviewed. You might think that it is unusual to send two thank-you notes, but it is the perfect way to communicate your interest and value to your interviewer in two ways: the thank-you e-mail demonstrates immediacy and helps you deliver value with a link to a relevant article, video, or blog, and the handwritten thank-you note provides a personal touch that few candidates take the time to do. As with the thank-you e-mail, timing is important for the handwritten note. It’s best to write and mail it the same day so your interviewer receives it within a day or two of the interview. It’s the perfect way to reinforce the fact that you go the extra mile to make an impression and build a relationship.
Thank-You Note(click to see video)
This video highlights some key elements of a handwritten thank-you note.
See Figure 11.7 "Sample Handwritten Thank-You Note" for a sample handwritten thank-you note. Additional sample thank-you notes can also be found at http://jobsearch.about.com/od/thankyouletters/a/samplethankyou.htm.
Figure 11.7 Sample Handwritten Thank-You Note
Dos and Don’ts of Thank-You Notes
Here are some tips for writing effective thank-you e-mails and notes:
Here are some things to avoid when sending thank-you e-mails and notes:
At the end of a job interview, it’s a good idea to ask about next steps. Usually interviewers or recruiters will tell you the expected time frame in which they will make a decision. This is valuable information because it will help you determine how and when you should follow up.
If you don’t hear back from the employer or recruiter within the specified time frame, it’s recommended that you call and follow up. Companies frequently have good intentions of making a decision quickly, but other business issues take priority. Following up with a phone call helps remind your prospective employer that you are interested in the position. While it is appropriate to follow up by e-mail, it is more effective to follow up by phone. It’s easier to have a conversation with the interviewer or recruiter and get some insight about the timing as well as reinforcing why you are a good choice for the position. Continue to do research on the company so that when you follow up, you can discuss company news. For example, you might say something like “I noticed that you were recently awarded the ACON business. It sounds like this is an exciting time at the agency and one that will need some motivated salespeople. I wanted to follow up on our conversation last week to see where you stand with filling the position.”
Set up a Google News Alert (http://www.google.com/alerts) using keywords for every company in which you are interested in working. The news alerts will be delivered to your e-mail (or other source you specify), and you will know all the latest news about the company—as it happens. It’s a good idea to send an e-mail to your contact about the news as a follow-up and a way to keep in touch.
You can see that follow-up is critical after an interview. It helps overcome objections even after the interview is over. The same principle of follow-up applies to every contact you make during your job search.
When you use the tools described in the Selling U sections of Chapter 7 "Prospecting and Qualifying: The Power to Identify Your Customers" and Chapter 8 "The Preapproach: The Power of Preparation" to get the word out about your personal brand, follow-up will be especially important. Your list of twenty-five target companies and the appropriate people to contact at each that you created in the Selling U section of Chapter 7 "Prospecting and Qualifying: The Power to Identify Your Customers" should include a phone number and e-mail address for each person on your follow-up list. Within one week of sending a cover letter and résumé, a phone call to each person (or at least the top twenty people) on your mailing list will help reinforce your cover letter and résumé and give you the opportunity to sell yourself on the phone.
You learned about the power of networking in Chapter 3 "The Power of Building Relationships: Putting Adaptive Selling to Work". But like other forms of contact, networking requires follow-ups. Make it a point to follow up by e-mail or phone with each person on your networking list every four to six weeks.
It’s especially important to follow up quickly with those people with whom you connected about a possible job or contact to someone at a company. It’s appropriate to follow up within a week, unless the person told you otherwise.
Now that you have read this chapter, you should be able to understand how to handle objections.
Now it’s time to put what you’ve learned into practice. Following are two roles that are involved in the same selling situation—one role is the customer, and the other is the salesperson. This will give you the opportunity to think about this selling situation from the point of view of both the customer and the salesperson.
Read each role carefully along with the discussion questions. Then, be prepared to play either of the roles in class using the concepts covered in this chapter. You may be asked to discuss the roles and do a role-play in groups or individually.
Role: Meeting planner at Capstone Industries, a distribution company
You are responsible for planning the annual meeting for the company. It is the only time that all five hundred employees are in one place. The three-day conference is usually quite a lavish affair; however, this year the budget is much smaller. Your objective is to book a five-star venue despite the budget reduction. You have just taken a tour of the lavish Premier Hotel, and you are impressed. However, the price you received in the proposal is still too high considering the fact that you would be booking five hundred rooms for three nights and three meals per day plus snacks, not to mention the additional business the lounge will realize from your attendees.
Role: Event sales rep, Premier Hotel
You are responsible for booking the events at this spectacular five-star hotel. The convention facilities are state-of-the-art and ideal for large corporate meetings. The accommodations are suites, not rooms, so two people can stay comfortably in each one, which helps reduce the overall cost of rooms. The service is impeccable and has ratings above the Ritz Carlton and Four Seasons. In fact, Premier Hotel has received the J. D. Power and Associates Award for the best service in the hospitality industry.
You have done your presentation along with a pricing proposal and presented it to the prospect. This is an important meeting for the hotel, and it’s important that you close the sale. However, first you will need to handle some objections.