Recently, I've been coaching a number of clients who work in highly competitive industries. It's not uncommon for these clients to have upwards of 30 direct competitors apiece - and that's just in the same town!
One subject that has been coming up a lot lately is what to do when the competition keeps dropping their prices. If you and your competitor sell the exact same product, this can be an extremely difficult situation. Regardless of how many times you remind them that "you get what you pay for," customers do tend to put the pressure on when they think they can get the same thing for less with someone else.
To counter this objection effectively, you must first believe that you are adding extra value for your customers, or providing a better service or product than your price-dropping competitors. If you aren't truly convinced that what you have to offer is better - in other words, if you can't justify a higher price to yourself - then you'll never be able to justify it to your customers.
Get the bad news out of the way first If your competitors always lower their prices, often the best thing you can do is bring it up early in the buying cycle with your prospects.
Yes - I'm suggesting you tell your customers that they can find what you're selling cheaper somewhere else. The key is in what you say, and how you say it.
For example, I usually say something like:
"Ms. X, I want you to know right up front that you will always be able to find a product similar to ours for less. While we are always competitive, we are not always the lowest price, and we are not always the most expensive. Knowing that we are not always the cheapest, does it make sense for us to move forward?" The answer you get will determine whether the customer is looking for value, or just looking for the lowest price.
The choice is yours
With the exception of Wal-Mart, no one wants to look cheap. As a result, the vast majority of clients will tell you that they're not interested in buying just the cheapest product or service.
In these cases, your response is simple: "Thanks for letting me know that. How will you be making your decision?" This takes you past discussing price, and onto a discussion of their true requirements.
But this approach is also highly effective even for those few people who will look you in the eye and say that if you aren't the cheapest, they don't want to do business with you.
Why?
Because it puts you in control. When someone tells you they only want to deal with you if you're the cheapest option, it gives you a choice. You can stay and play the discount game if there are good strategic reasons to do so. Or you can choose to walk away, and let your competitors lose money serving this prospect.
Sunday, December 17, 2006
Saturday, December 16, 2006
9 Steps to Building a Profitable Customer Relationship
Success in sales depends directly on your ability to make yourself likeable, and create a positive experience for your customers. The following 9 Tips are some of the best - and easiest - ways I know to help you create a more positive customer experience:
1. Love what you sell, the company you work for and the customers you serve.
If you are truly passionate about these three things, your willingness to help your customers solve their problems will shine through. Customers will believe your sincerity and be captivated by your excitement. In short - you will be fun to work with. Our studies show that customers prefer to buy from sales people who overtly show that they believe in the products they sell, and the companies they work for. Choose to be honest, open and empathetic to your customers' needs, and you will experience consistent sales growth, build an excellent reputation and become one of the top performers in your field.
2. Be empathetic and compassionate.
Truly care about your customers, and remember that no matter how good an actor you are, faking it simply won't work. Ask questions, take notes and lean in to show that you're engaged in their answers. When you take an interest in people, they remember you - and when people remember you, it's good for business.
3. Add value and give first.
Share your network of contacts with your customers, and don't expect them to give you their business without you giving them something first. I don't mean give away free product in the hopes they will buy more. Instead, give away things that increase your value - like a referral to a partner of yours, a solution to a business problem that you read about or heard from someone else, or even help finding a new dentist!
4. Make eye contact.
This is especially important when you walk into a room full of people. Eye contact is also essential after we get to know people, because it cements our existing relationships and lets them know that we're still interested in their well being. Very few sales people ever look their prospects directly in the eye. By simply smiling and making eye contact, you'll be surprised how much you will set yourself apart.
5. Express your true intent.
Tell customers upfront: "I don't know if there's a fit between what you need and what I have right now, but I'm hoping we can explore that in more detail during this meeting." Or: "I only have your best interests at heart, and I promise to be honest with you throughout our conversation. In the end, I hope that we can mutually decide if there is a reason to move forward. If not, that's fine too, and I hope you'll feel comfortable telling me so." This advice runs counter to 90% of the approaches I see being used in the field today. But then again, maybe that's why only 10% of sales people are top performers. Try it yourself a few times, and you'll be amazed at the response you get.
6. Don't go for the big decision all at once.
In our personal lives, we don't propose to someone on a first date (at least, not usually!). The same is true in our business relationships. So get approval from the customer to move ahead in increasing increments. The first approval might be just to agree to speak openly with each other, as outlined in Tip #5 above. The second could be an agreement on a follow-up call time or meeting date. The third might be gaining agreement on the decision making criteria or a commitment to have the "big boss" present at the demo, followed by an agreement to a "go/no go" decision date. All too often, I see sales people jumping way ahead of their prospect's buying curve. This puts the buyer and seller out of sync. When the sales person is trying to close while the prospect is still evaluating options or determining risk, trust is broken, the prospect feels pushed and the sale comes dangerously close to disappearing.
1. Love what you sell, the company you work for and the customers you serve.
If you are truly passionate about these three things, your willingness to help your customers solve their problems will shine through. Customers will believe your sincerity and be captivated by your excitement. In short - you will be fun to work with. Our studies show that customers prefer to buy from sales people who overtly show that they believe in the products they sell, and the companies they work for. Choose to be honest, open and empathetic to your customers' needs, and you will experience consistent sales growth, build an excellent reputation and become one of the top performers in your field.
2. Be empathetic and compassionate.
Truly care about your customers, and remember that no matter how good an actor you are, faking it simply won't work. Ask questions, take notes and lean in to show that you're engaged in their answers. When you take an interest in people, they remember you - and when people remember you, it's good for business.
3. Add value and give first.
Share your network of contacts with your customers, and don't expect them to give you their business without you giving them something first. I don't mean give away free product in the hopes they will buy more. Instead, give away things that increase your value - like a referral to a partner of yours, a solution to a business problem that you read about or heard from someone else, or even help finding a new dentist!
4. Make eye contact.
This is especially important when you walk into a room full of people. Eye contact is also essential after we get to know people, because it cements our existing relationships and lets them know that we're still interested in their well being. Very few sales people ever look their prospects directly in the eye. By simply smiling and making eye contact, you'll be surprised how much you will set yourself apart.
5. Express your true intent.
Tell customers upfront: "I don't know if there's a fit between what you need and what I have right now, but I'm hoping we can explore that in more detail during this meeting." Or: "I only have your best interests at heart, and I promise to be honest with you throughout our conversation. In the end, I hope that we can mutually decide if there is a reason to move forward. If not, that's fine too, and I hope you'll feel comfortable telling me so." This advice runs counter to 90% of the approaches I see being used in the field today. But then again, maybe that's why only 10% of sales people are top performers. Try it yourself a few times, and you'll be amazed at the response you get.
6. Don't go for the big decision all at once.
In our personal lives, we don't propose to someone on a first date (at least, not usually!). The same is true in our business relationships. So get approval from the customer to move ahead in increasing increments. The first approval might be just to agree to speak openly with each other, as outlined in Tip #5 above. The second could be an agreement on a follow-up call time or meeting date. The third might be gaining agreement on the decision making criteria or a commitment to have the "big boss" present at the demo, followed by an agreement to a "go/no go" decision date. All too often, I see sales people jumping way ahead of their prospect's buying curve. This puts the buyer and seller out of sync. When the sales person is trying to close while the prospect is still evaluating options or determining risk, trust is broken, the prospect feels pushed and the sale comes dangerously close to disappearing.
Friday, December 15, 2006
Check Your Attitude - You Cannot Sell Ice To An Eskimo
Can you sell ice to an Eskimo? What about ice cream to an Eskimo? How about ice cubes?
If you said yes to the above questions, then congratulations, you suck as a salesperson!
Of course, nobody sells ice to an Eskimo. That is just a metaphor. But some salespeople love to boast that they can. It is my belief that those salespeople that claim to be able to sell ice to an Eskimo are actually bad salespeople. It is this cocky attitude that represents everything bad about the sales profession. When you say you can sell ice to an Eskimo, you are basically saying that you will sell anything to anybody, no matter if they actually need what you are selling or not. An Eskimo does not need ice.
Think about the image of the slimy used car salesman. People hate this person and everything he represents. He is out to make a buck at the expense of anybody he can swindle. He doesn’t care if he sells you a lemon as long as he gets paid his commission. It is cocky people like this that give sales professionals a bad image.
So, would you still want to sell ice to an Eskimo? If you sell something that doesn't actually need your product, your client will eventually come to terms with this fact and will probably end up telling others. You will eventually get a bad reputation and lose future customers. You can forget about getting future business referrals as well. People will generally dislike you.
If you said yes to the above questions, then congratulations, you suck as a salesperson!
Of course, nobody sells ice to an Eskimo. That is just a metaphor. But some salespeople love to boast that they can. It is my belief that those salespeople that claim to be able to sell ice to an Eskimo are actually bad salespeople. It is this cocky attitude that represents everything bad about the sales profession. When you say you can sell ice to an Eskimo, you are basically saying that you will sell anything to anybody, no matter if they actually need what you are selling or not. An Eskimo does not need ice.
Think about the image of the slimy used car salesman. People hate this person and everything he represents. He is out to make a buck at the expense of anybody he can swindle. He doesn’t care if he sells you a lemon as long as he gets paid his commission. It is cocky people like this that give sales professionals a bad image.
So, would you still want to sell ice to an Eskimo? If you sell something that doesn't actually need your product, your client will eventually come to terms with this fact and will probably end up telling others. You will eventually get a bad reputation and lose future customers. You can forget about getting future business referrals as well. People will generally dislike you.
Thursday, December 14, 2006
What If
What if this year;
You made one more prospect phone call every day?
You asked every prospect and client for a referral?
You eliminated one destructive sales habit?
You increased your market awareness with better networking skills?
You attended a sales seminar or sales boot camp that your company didn’t pay for?
You stopped accepting prospect’s excuses?
You became the most knowledgeable person in your industry?
These questions are endless and I won’t give you more to think about than you have time for today or even this week.
But I will share with you a simple truth – if you want to sell more every year you have to get better every year.
Let me get to the heart of the matter. If you have been receiving my tips for more than a few months you know that I have spent little time promoting my books, CD’s and boot camps. If you enjoy my tips and benefit from just a few hundred words once a week I would ask you – have you yet purchased one of my over 100 books, manuals or CD’s?
If yes, I hope you have enjoyed them and benefited from them. If not, why haven’t you? Is it the money? Remember the cost of not learning is far higher than the investment in learning. Is it the lack of time? Or some other reason or excuse?
Let me repeat at the sake of sounding redundant. If you want to sell MORE every year you MUST get better every year.
So let me ask you;
What is on your agenda this year to improve your skills?
What is your budget this year for improving your abilities?
What time have you allocated to learning and improving?
What career development organizations are you going to join this year?
What books are you going to read this year?
Let me leave you with some of the statistics and concepts that have driven my personal development philosophy for over forty years.
- Less than ten percent of the population gets what they want from life.
- Less than five percent of the population routinely invests in the improvement and
development of their skills and attitudes.
You made one more prospect phone call every day?
You asked every prospect and client for a referral?
You eliminated one destructive sales habit?
You increased your market awareness with better networking skills?
You attended a sales seminar or sales boot camp that your company didn’t pay for?
You stopped accepting prospect’s excuses?
You became the most knowledgeable person in your industry?
These questions are endless and I won’t give you more to think about than you have time for today or even this week.
But I will share with you a simple truth – if you want to sell more every year you have to get better every year.
Let me get to the heart of the matter. If you have been receiving my tips for more than a few months you know that I have spent little time promoting my books, CD’s and boot camps. If you enjoy my tips and benefit from just a few hundred words once a week I would ask you – have you yet purchased one of my over 100 books, manuals or CD’s?
If yes, I hope you have enjoyed them and benefited from them. If not, why haven’t you? Is it the money? Remember the cost of not learning is far higher than the investment in learning. Is it the lack of time? Or some other reason or excuse?
Let me repeat at the sake of sounding redundant. If you want to sell MORE every year you MUST get better every year.
So let me ask you;
What is on your agenda this year to improve your skills?
What is your budget this year for improving your abilities?
What time have you allocated to learning and improving?
What career development organizations are you going to join this year?
What books are you going to read this year?
Let me leave you with some of the statistics and concepts that have driven my personal development philosophy for over forty years.
- Less than ten percent of the population gets what they want from life.
- Less than five percent of the population routinely invests in the improvement and
development of their skills and attitudes.
Wednesday, December 13, 2006
2007 Salesmanship Tips - Selling and Negotiating with Integrity
Perhaps you are already in a sales job or had been a sales profession for a while and you have read various books on the subject and you have decided to maintain and continue your sales profession ongoing education by also reading this book. This is a very smart habit for salespeople because it keeps them motivated and at the top of their game. But what he is a salesperson? In this book we will discuss selling with integrity and positioning yourself as a; Consultant, Problem Solver and Expert.
In my career I started out as a very small business and grew the business very large into a franchising company servicing 450 cities and 110 markets with franchisees in 23 states and four countries. In franchising there is a lot of sales going on for instance you have to sell the franchise and put the franchised outlet into the marketplace and then help the franchisee with their sales and train them to be effective. Also many franchise companies like ours had national accounts and those two needed to be sold. After all if the franchisees did not make money they would not be able to pay us the royalties.
As we set out to sell our franchises we realized that we had to sell only to qualified prospects who we believed could carry our brand name without tarnishing our stellar reputation. We also quickly realize that when we sold national accounts those companies were interested in saving money and would only hire our services if we could save them money and of course we could not take the accounts unless we could make money doing it. You can see quite quickly how selling with integrity and positioning yourself as a consultant, problem solver and expert was paramount to our success as a franchising company.
In my career I started out as a very small business and grew the business very large into a franchising company servicing 450 cities and 110 markets with franchisees in 23 states and four countries. In franchising there is a lot of sales going on for instance you have to sell the franchise and put the franchised outlet into the marketplace and then help the franchisee with their sales and train them to be effective. Also many franchise companies like ours had national accounts and those two needed to be sold. After all if the franchisees did not make money they would not be able to pay us the royalties.
As we set out to sell our franchises we realized that we had to sell only to qualified prospects who we believed could carry our brand name without tarnishing our stellar reputation. We also quickly realize that when we sold national accounts those companies were interested in saving money and would only hire our services if we could save them money and of course we could not take the accounts unless we could make money doing it. You can see quite quickly how selling with integrity and positioning yourself as a consultant, problem solver and expert was paramount to our success as a franchising company.
Tuesday, December 12, 2006
Don't Lose Control Of Your Sales Cycles
One of the biggest mistakes poor salespeople make is they lose control of the sales process. There are many ways they accomplish this feat, here are a few for your consideration:
1-They quote price just because the prospect has asked (before they have had a chance to build value.
2- They don’t ask enough questions early in the sales process, they just ramble on.
3- They send out literature when asked, without first qualifying the prospect.
4- They deliver proposals to the prospects door and wait for their answer, to buy or not to buy, that is the question.
5- They fail to set appointments that are convenient to them and always bow to the customer.
6- They lug equipment to demonstrate in the prospect’s office rather than getting the prospect to visit their office.
7- They don’t get deposits and hope the prospect will pay someday.
8- They leave –will calls- when telephoning a prospect.
I could go on but I am sure you get my drift.
Control is one of the key elements for success in sales. Successful salespeople understand that control is not manipulation but is in the ultimate best interests of the prospect or client.
I will bet you have a prospect right now as you are reading this where you have lost control. You are waiting for them to respond to your offer, appeal or whatever. I know because I teach this stuff and I am guilty from time to time of making the same mistake. How do you get and keep control? It is simple but not easy.
The best time to get control of the sales process with a new prospect is in the early stages of the relationship. It is very difficult, if not impossible to get it back later if you didn’t get it early. One of the best strategies is to get information before you give it. Questions always come before your presentation, pricing, literature etc.
1-They quote price just because the prospect has asked (before they have had a chance to build value.
2- They don’t ask enough questions early in the sales process, they just ramble on.
3- They send out literature when asked, without first qualifying the prospect.
4- They deliver proposals to the prospects door and wait for their answer, to buy or not to buy, that is the question.
5- They fail to set appointments that are convenient to them and always bow to the customer.
6- They lug equipment to demonstrate in the prospect’s office rather than getting the prospect to visit their office.
7- They don’t get deposits and hope the prospect will pay someday.
8- They leave –will calls- when telephoning a prospect.
I could go on but I am sure you get my drift.
Control is one of the key elements for success in sales. Successful salespeople understand that control is not manipulation but is in the ultimate best interests of the prospect or client.
I will bet you have a prospect right now as you are reading this where you have lost control. You are waiting for them to respond to your offer, appeal or whatever. I know because I teach this stuff and I am guilty from time to time of making the same mistake. How do you get and keep control? It is simple but not easy.
The best time to get control of the sales process with a new prospect is in the early stages of the relationship. It is very difficult, if not impossible to get it back later if you didn’t get it early. One of the best strategies is to get information before you give it. Questions always come before your presentation, pricing, literature etc.
Monday, December 11, 2006
Don't Overcome Objections - Sell Value
Sales resistance is a function of several things in the sales process. Some of them are:
1. Poor prospect qualification.
2. Poor timing.
3. Hidden agendas on the part of the prospect.
4. Lack of trust.
5. Lack of respect.
6. Lack of understanding by the prospect in some aspect of
your sales message.
7. Lack of acceptance of your sales message.
When a prospect gives you sales objections or sales resistance one of the above issues is usually the case. However, they might not tell you their real reason. There is what I call in the sales process a truth line. Prospects often tell you what is above the line hiding the real truth below the line. For example. The prospect says, the price is too high.” What else could they really be saying? What is below the truth line. “I don’t have the money or credit. You haven’t convinced me it is worth the price you are asking (perceived value). I don’t have the authority to make a decision , but I don’t want to admit that. So you see there is more to sales resistance than meets the eye. One technique I have used when I get sales resistance is to ask the prospect a question when I get any type of objection. “In addition to that is there anything else that would get in the way of our doing business together.”
The rationale for this question is: I am accepting their objection as real for them. I am not challenging it. But, I am asking what else is there? If there is nothing else they will either admit that there isn’t or make one up. In either case I am further below the truth line. If they admit there isn’t I am now closer to closing the sale presuming I can effectively deal with this issue.
The key to disarming sales resistance is to identify early in the process what the potential areas of concern are and then weaving the answers into the sales process.
You can effectively answer sales objections all day long and still not close the sale if you are not dealing with the real issues.
Why people challenge price.
Prospects, customers want several things from their suppliers. Fair price, quality products and services and timely service. (not in order of their preference) Surveys that have been done of consumers say that most consumers want: Timely and responsive service first, quality products and services second and low price third. For over 20 years I have surveyed my sales audiences and asked them what they think is most important to consumers and the results have been consistent: Low price, quality and service last. We seem to have a difference in perception here.
There are three elements that must be understood by salespeople if they are going to effectively deal with the price issue. First there is price. That is what people pay for what they buy. Second is cost. That is what they pay for what they buy, over time. And then there is perceived value. That is what they want for the money they pay.
Most consumers tell salespeople that what they want is low price when what they really want is low cost. Now I know that many of you will take issue with this statement but I only ask that you consider for a moment what you as a consumer want. Do you want the cheapest or that which solves your problem or answers your need or desire?
Most prospects or customers want their problems solved. They know that you get what you pay for and that the distaste of poor quality lasts far longer than the sweetness of low price.
People object to price when they feel that what you are asking them to pay is higher than their perceived value. Most poor salespeople when they get price resistance, lower the price. Most of the time it is not a price or cost issue but one of too low perceived value. How do you raise perceived value? Find out what is preventing your prospect or customer from getting a good nights sleep and show them how your product or service will satisfy this need or want or even better exceed their expectations for value, and I guarantee you price will be secondary. Not, cost, but price.
1. Poor prospect qualification.
2. Poor timing.
3. Hidden agendas on the part of the prospect.
4. Lack of trust.
5. Lack of respect.
6. Lack of understanding by the prospect in some aspect of
your sales message.
7. Lack of acceptance of your sales message.
When a prospect gives you sales objections or sales resistance one of the above issues is usually the case. However, they might not tell you their real reason. There is what I call in the sales process a truth line. Prospects often tell you what is above the line hiding the real truth below the line. For example. The prospect says, the price is too high.” What else could they really be saying? What is below the truth line. “I don’t have the money or credit. You haven’t convinced me it is worth the price you are asking (perceived value). I don’t have the authority to make a decision , but I don’t want to admit that. So you see there is more to sales resistance than meets the eye. One technique I have used when I get sales resistance is to ask the prospect a question when I get any type of objection. “In addition to that is there anything else that would get in the way of our doing business together.”
The rationale for this question is: I am accepting their objection as real for them. I am not challenging it. But, I am asking what else is there? If there is nothing else they will either admit that there isn’t or make one up. In either case I am further below the truth line. If they admit there isn’t I am now closer to closing the sale presuming I can effectively deal with this issue.
The key to disarming sales resistance is to identify early in the process what the potential areas of concern are and then weaving the answers into the sales process.
You can effectively answer sales objections all day long and still not close the sale if you are not dealing with the real issues.
Why people challenge price.
Prospects, customers want several things from their suppliers. Fair price, quality products and services and timely service. (not in order of their preference) Surveys that have been done of consumers say that most consumers want: Timely and responsive service first, quality products and services second and low price third. For over 20 years I have surveyed my sales audiences and asked them what they think is most important to consumers and the results have been consistent: Low price, quality and service last. We seem to have a difference in perception here.
There are three elements that must be understood by salespeople if they are going to effectively deal with the price issue. First there is price. That is what people pay for what they buy. Second is cost. That is what they pay for what they buy, over time. And then there is perceived value. That is what they want for the money they pay.
Most consumers tell salespeople that what they want is low price when what they really want is low cost. Now I know that many of you will take issue with this statement but I only ask that you consider for a moment what you as a consumer want. Do you want the cheapest or that which solves your problem or answers your need or desire?
Most prospects or customers want their problems solved. They know that you get what you pay for and that the distaste of poor quality lasts far longer than the sweetness of low price.
People object to price when they feel that what you are asking them to pay is higher than their perceived value. Most poor salespeople when they get price resistance, lower the price. Most of the time it is not a price or cost issue but one of too low perceived value. How do you raise perceived value? Find out what is preventing your prospect or customer from getting a good nights sleep and show them how your product or service will satisfy this need or want or even better exceed their expectations for value, and I guarantee you price will be secondary. Not, cost, but price.
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