In a world of online shopping and the greatest price transparency ever, it may seem logical that price is what drives a buyer's decision making, but some things never change, and one of them is price isn't the most important factor in a buyer's mind. Many salespeople seem to forget, or maybe they never understood in the first place that price, and especially the lowest price can actually work against you.
Having the lowest price signals to the buyer that your offer is sub-standard in quality, value, longevity, or appeal. People will often say price is what they're after, and maybe believe price is the most important criteria, but it rarely is. According to many marketing experts, the key primary factors driving a buyer's decision are:
- Quality – Not a big surprise really, but it doesn't matter what the price is if the quality isn't what it needs to be. Buyers will pay a premium for quality, albeit of course it's perceived quality that counts. As someone in sales, it's your job to communicate the quality of the product or service to the buyer.
- Trust – Buyers have to trust what you're telling them. If you don't establish trust, it doesn't matter what the price or quality of a product is.
- Convenience – Does the offer provide a greater level of convenience to the buyer?
- Branding – All else being equal, buyers will choose a brand they know before buying a brand they never heard of
- Peer Influence – The old saying of "No one gets fired for buying IBM" holds true today, just maybe it's not IBM depending on your industry. If a buyer believes they're outside of the lines based on what their peers will say or think, they're much less likely to buy.
Hopefully, the above doesn't come as a complete surprise, albeit so many salespeople and marketers fail to remember price is only one factor to consider. It may or may not be a significant factor with any given buyer, but it's still only one. Getting past the price issue, and assuming the value in your product or service is where it needs to be, the sale should be a slam dunk and all that's left is to write it up. Not so fast…..and sometimes it's that exact feeling, the sale is made before it walks in the door, that causes what is otherwise a sale in the jaws of victory, out and into the waste bin. Let's examine some of the reasons why you or your sales team may be losing sales that you would have otherwise made.
1. Today's profit means everything – In Japan during their massive 80s bull market when everyone thought they may take over the world, I learned "Today's profit means nothing, tomorrow's profit means everything". What that means is that if you're only focused on what you're making off a sale today, you'll lose sight of the fact that future sales are almost always much more important. We see it all the time with salespeople. They're so interested in getting the buyer to sign the bottom line, that the salesperson fails to understand the full potential, leaving it to someone else and misses out.
2. Saying NO for your client – Many salespeople make the decisions for the client/prospect without the client/prospect having a chance to let their thoughts and objectives be fully heard. Just because you think you know what's best for the client doesn't mean that's what they want. A great example goes back to the price factor. If you're presenting a product or service on price, but the client/prospect is thinking they want the best, you're going to quickly turn them off and lose the sale. Let the client steer the discussion to articulate what their objectives and goals are. After you understand what they want, and what they value, then you can present your best ideas, albeit it's important to try and make it more than one so you can gain feedback along the way.
3. Creating urgency when none exists – I sell insurance and one of the holy mantras of the insurance world is to create urgency in the buyer so they'll purchase right now. Hogwash, if the buyer isn't fully convinced they want the product, pressuring them to sign, and to sign quickly is one of the best ways to turn them off to you. Few people enjoy the back-and-forth of walking onto a used car lot and receiving the full-court press. Time-share sales wouldn't have to give away so much free stuff to get people to listen to their sales pitch if people liked that experience. It may work sometimes, and for some salespeople, it may work well enough that they buy into it, but it's much better to have the client/prospect come to their own conclusion on the value, need, and urgency if what you're offering truly will improve their situation. If what you're offering won't, then maybe you're only thinking of yourself, and then I probably can't help you.
4. Failing to address the objections and/or questions – Brushing over, avoiding, or doing the "Washington two-step" may be a strategy by some, but it's a losing one. If you don't know the answer, own up to it, and find out. It's ok to say "I don't know, but I'll find out". And if you say you'll find out, it's vitally important that you follow up and do provide a complete answer. Questions mean they're interested enough to engage and find out more. So, don't view them as a negative when they're actually the opposite and indicate that if you can meet the prospect's needs, you have a shot at the sale.
5. Not respecting your prospect – Everyone has their skill sets with their strengths and weaknesses. As a salesperson, your primary objective is to enable the prospect to determine if the product or service you offer is the correct one for them. Notice I didn't say your main objective is to make a sale, but even if you feel making the sale is the most important objective and your reason for doing what you do (you're wrong, but let's roll with it), do you think demonstrating any type of response other than a sense of service will help you make a sale? If the prospect has the slightest feeling that you think they're stupid, or even unusually ignorant, they'll stop asking questions, and in fact, they'll likely want to remove themselves from the situation. In other words, never assume the prospect knows anything more than what you have may be something they want. Also, think of it as a good thing that you have knowledge they don't have. It means you're adding value, and it's when you add value that you have an advantage over another channel, like Amazon or some other automated process.
6. Failing to put yourself in the prospects shoes – Empathy goes a long way, especially in the sale's process. Don't fail to take the time and ask enough of the right questions so you can understand what problem the prospect is attempting to solve. People don't buy flashlights and batteries, they buy the ability to light up the dark. Once you find the problem, then you can begin to solve it. You'll never find the underlying problem until you ask enough questions and place yourself in their position to fully understand their point of view. If you don't take the time, you'll offer products and services that may appear correct, but don't solve the underlying problem. You won't make as many sales, and more sales will be refunded if the solution isn't correct. Also, you'll miss out on larger sales than you thought possible because you offered a subordinate solution than what was desired.
7. Common bond – Small talk and fake artificial openness won't take you very far in sales. When searching for a common bond, it's important to be true to who you are, because liking "everything" becomes very obvious rather quickly for most. Of course you want to be careful not to touch on a subject that may demonstrate a complete opposite appeal, like politics, but it's OK to not like a football team or to like another. Honesty and credibility goes a long way, plus it's easier to keep your story straight if you're honest from the start.
8. I want to talk about me – A mistake many salespeople make is letting the prospect know how great they are, and using time that could be spent finding out more about the prospect to talk about themselves. People expect that if you're selling a product or service you know what you're talking about and you're qualified. Now there is one exception that should be acknowledged. If you're really young, especially for the product you're selling, you may want to discuss what if any qualifications you have, but in a brief and concise fashion that doesn't take away from the fact finding purpose of your conversation. Everything is an asset and a liability. If you're young, your prospect may see themselves in you, or identify someone in their family like you. An honest approach, coupled with being yourself is a winning strategy. Resume inflating can result in getting called-out or worse. Buyers will often give a newbe slack that they wouldn't otherwise, especially if they feel the new person has the buyer's interest at heart. Lying may make a sale, but it won't make a career.
9. Don't call me, I'll call you – If you say you're going to respond, regardless if it's to answer a question or just to follow up, make sure you do it. Buyers often think of questions after thinking about the proposal, and they may be waiting to ask that final question before moving forward. If the buyer expects to hear from you to ask and buy, but you don't reply as you said you would, you've destroyed any good will and credibility you may have developed. And the follow up can't be at any time, it must be when you say you will. If you're not sure, say so, it's much better to under promise and over deliver than the other way around.
10. What's behind door number three? – Don't lower the price after you said you've provided the best price. It demonstrates that either you lied, or you don't know what you're doing. The buyer may at first like the better deal, but once they've had time to think about it, they'll wonder if they actually did receive the best price. Plus, emotionally, do you really want to get beat up and make your buyers beat you up for the best price. And what does that say about your sales practices with your clients if you're trying to figure out how much to get out of any given client instead of focusing on the client's needs?
The common theme of each of the 10 reasons is to do what's in your clients best interest. For those wanting a career in sales, and not just a paycheck this week, there's no other way, and luckily, it's the best way. The best way because nothing drives home referrals like happy clients.
Robert Weinstein is a husband, dad, stock market junkie, real estate broker, and of course…Insurance agent. Interests include my family, economics, marketing, technology, real estate, finance/investing, history, and Asia.
Robert’s insurance expertise includes having the designation of Certified in Long-Term Care (CLTC) and assist in asset protection for families with members entering retirement.
Robert is also an accomplished syndicated writer whose work can be found in TheStreet, MainStreet, CNBC, Forbes, Yahoo Finance, Seeking Alpha, MSN Money, The Money Show, Stock Saints, Motley Fool, Fidelity, Minyanville, RealMoney Pro, and many national and international newspapers.