The JF Guest Author Spot
Paul S. Goldner
So much has been written about objection handling that you might wonder why I am going to revisit one of the oldest and potentially most challenging areas of sales. The answer is simple; there is a better way to handle this time tested topic.
Background: When I learned about objection handling early in my sales career, I was taught a simple, but relatively effective four step process:
• Step I - Listen fully and completely.
• Step II - Demonstrate an understanding of the customer's (or prospect's) position. This is otherwise known as showing empathy. Empathy does not mean that you agree with the customer. It only means that you understand their position.
• Step III - Provide your viewpoint on the issue or situation.
• Step IV - Go for the close. If you are prospecting for new business, "the close" means that you ask for the appointment, typically the goal of your prospecting call (assuming that you are a field seller).
If you are much further into the sales process, "the close" means asking for the business.
While the word close may have different meanings depending on where you are in the sales process, the four steps above provide a time tested process for handling objections. But there is a better way!
When I learned about objection handling, I also learned about "objection handling techniques. Many of you are, I'm sure, aware of the same techniques that I am. These include:
• Feel, Felt Found - This technique, while often viewed as a sales technique with the word sales having a negative connotation, is quite effective in the right circumstance. This technique is often quite useful in handling the price objection, for example. You could say something along the lines of the following when responding to a typical price objection:
I can understand how you feel. Many of my best customers also felt that way but what they found, when they started to work with us is that our company gave them a much lower total cost of ownership due to our regional manufacturing and service facilities.
• Ask an open ended question - This technique is also quite effective and uses one of the best of sales tools available, the open ended question to probe for more information.
Here again, the customer could say something along the lines of "your price is too high".
You could respond with an open ended question such as "how did you arrive at that conclusion?" or "what factors entered into your decision making process?"
The interesting point about this objection handling technique is that it makes use of the open ended question to gather more information about the customer's concern.
The reason that you probably find yourself in this position because you did not ask enough open ended questions earlier in the sales process. In essence, you are almost getting a second chance to make the sale.
• Present a different alternative - This is one of my favorite objection handling techniques though it is only a personal preference. I am not advocating any one technique above the others. The choice should be made by you in terms of what you feel most comfortable with and what you believe is most effective for you.
The good news about objection handling is that you typically do not need more than one response to a given objection. In our examples around the price objection, you will see four equally impactful responses. Depending upon your preference, you will typically select one of these four for your personal use in the field.
Using the different perspective or different alternative method, you could state that "your way of viewing this point is one way to look at the facts and my way is simply another (i.e.: the different alternative). If you were to consider the time saving features of our web site, you will see that you get the best return on your investment with us."
• Ask leading questions - Leading questions are often not discussed in a sales program. I am not sure why but leading questions are very powerful in terms of handling objections. In fact, that is what they are most often used for.
Leading questions are used typically in the middle of a sales process when you need to overcome customer objections. Leading questions, if used correctly, can artfully cause your customer to consider new facts and circumstances when the prospect otherwise thought they were correct.
For example, you could respond by saying "have you considered the impact of our web site (see prior example) on the time it takes for you to process an order?"
Here, instead of telling the customer that they made a bad decision or may be about to make a bad decision by using price, instead of value, as their decision making criterion, you artfully ask them a question that allows the customer to gracefully change their answer or decision without having to acknowledge they were wrong.
How many objections are there in sales? I love to ask this question when I deliver a seminar that includes objection handling as one element of the seminar. The answers range from a low of one to a high of infinite.
The lower guesses that I receive (say one to ten) are simply because the people in the program know that I am asking a trick question. The answers of hundreds and thousands are the ones that the program participants really believe are correct.
However, the true answer is that there are only FOUR OBJECTIONS in the whole world. The challenge comes from the fact that there are many, many ways to say exactly the same thing.
For example, staying with the price objection example, one way to state the price objection is for the customer or prospect to simply say that "your price is too high". However, another way to say the same exact thing is to say that "their (the competition's) product comes with free shipping or installation."
By making the latter remark, the customer is telling you that your product, plus the cost of shipping or installation is more expensive than the competition's product.
Likewise, the prospect could state that they are using the competition for the product you are selling and they are quite happy with the results they achieve. They could also say that they handle the need for your product or service internally. What this latter statement means is that the customer makes the product or delivers the service themselves rather than calling on a third party organization like yours to do the same thing.
As you can see, there are many ways to state exactly the same thing in terms of objection handling which leads me to understand that there are only four objections in sales; Price, Competition, Not Now and Will It Work? Every other objection is just a version of one of these four basic objection categories.
Because of this, we are now prepared to give you "The Three Easy Steps to Handling Four Hard Objections."
• Step I - Listen fully and completely. This is the same first step as before because it is crucial to understand what the customer is telling you.
• Step II - Categorize the objection. Here, you are asked to place the objection you just heard into one of our four categories; Price, Competition, Not Now and Will it Work?
• Step III - Provide the category response. Step III is really where the great insight comes from.
Provide the Category Response: Because there are only four objections in sales, irrespective or your industry, your geography or your job role (inside sales vs. outside sales), you need not memorize thousands of responses to what seems like thousands of objections. Rather, you need only prepare one good response for each of the four category objections.
Since we have already provided four sample responses to the Price objection above, we will focus on giving you representative responses to the other three categories.
• Competition: The customer says "we use your largest competitor". To this, you can respond by saying "That's fine. They are a good company, but what we have found is that we can often be an excellent supplement to some of the things that they provide. For example ... {you would have to complete this sentence for your response to be effective. Your response is a function of the company and the industry that you work in.}"
• Will it work? The customer says "have you ever successfully implemented this in our industry?" To this, you can state "I can see why that would be a concern to you. It would be a concern to me if I were in your position. What I would like to do is to provide you with three references of companies in your industry where we have already successfully implemented this solution."
• Not now: The customer says "I don't have a need for that now." Here, you can respond by saying "I can understand that that you don't have a need at the moment but as long as I have you on the phone, do you mind if I ask you a few questions? This way, when you do have a need, I will already have an understanding of your business."
Here, what you are doing is using open ended questions to try to find some unstated customer need that you can act on now as a basis to get your face to face meeting.
In this situation, I recommend using three open ended questions. If you cannot get a meeting after three open ended questions, my recommendation is to set up this prospect for your next call to them a month or more into the future.
Keys to success: There are two keys to success in implementing our new approach to objection handling.
The first is to understand what key phrases you should use when crafting each of your four category responses. The key phrases have been highlighted in our responses above through bold and underlined text. They are also presented here for your greater understanding:
• Price - Lowest total cost of ownership or greatest return on investment.
• Competition - Supplement, compliment or in addition to.
• Will it work? - Reference stories.
• Not now - Use three open ended questions to probe for additional reasons to meet when the initial reason that you used is not compelling to the prospect.
The second key to success is preparation. Because there are only four objections in all of sales, there is no excuse not to prepare a response for each and to role play and practice your responses until you are as fluent as an Academy Award actor or actress.
Conclusion: The 21st century has presented us with an unprecedented series of business events from the Dot Com crash in year 2000 to September 11th in year 2001 to the credit crisis in year 2008.
If you were to go back and study the significant business events each and every year since the turn of the century, you will find that each year has been characterized by more than one, once in a lifetime event that has rocked the global economy.
And all of this is taking place under the technology revolution that started in the early 1980s and is still going incredibly strong today as the Internet and new technologies continue to evolve and develop.
Our response to these major economic events has got to be to consistently improve and grow as sales professionals. We must find new ways to do old things that allow us to become more efficient, more effective, more professional and more value oriented. Remember, the Law of Evolution tells us that only the strong will survive.
I hope that you found this new approach to objection handling to be refreshing and valuable. May 2009 be a REDHOT year for all of you!
Paul S. Goldner is a noted author, entrepreneur, global sales strategist and professional speaker. He is the author of the REDHOTSALES® series of books; Red Hot Cold Call Selling, 2nd Edition (AMACOM, 2006), Red Hot Customers, Selling Value (Chandler House Press, 1999), Red Hot Sales Negotiation (AMACOM, 2007) and Red Hot Selling (AMACOM, to be released in the spring of 2009). Paul can be reached at 914-232-HOT2(4682), 914-232-4845, [email protected] and WWW.REDHOTSALES.COM.
Today's News: My good buddy, Clayton Shold over at Salesopedia is doing something different this week; instead of the usual interview, he and his erstwhile partner in crime, Dave Maynard, are interviewing each other, and discussing the evolvement of Salesopedia - it really is fascinating. You can listen in here.
Tomorrow: There can be no doubt that in these troubled times, whilst it is always essential to seek out new business opportunities, it is vital that we consolidate the clients/customers we already have, because they will be being targeted by our competitors: So tomorrow, I will share with you, more of the JF Major/Key Account Model: Here's a snippet.
"As the Chinese general Liu-Ji wrote over 600 years ago:
"Action always starts with calculation. Before fighting, first asses the relative wisdom of the leadership, the relative strength of the enemy, the size of the armies, the lie of the land, and the adequacy of provisions. If you send troops out only after making these calculations, you will never fail to win."
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