The Personal MBA: The Foundation of Effective Business

Lesson 10 of 14

Sales: Turn Prospects into Paying Customers Part III

 

The Personal MBA: The Foundation of Effective Business

Lesson 10 of 14

Sales: Turn Prospects into Paying Customers Part III

 

Lesson Info

Sales: Turn Prospects into Paying Customers Part III

The process of selling is the process of really helping to understand your customer and what they want and helping them understand why this thing that you're offering is valuable enough for them to pay for, but sometimes it's not that easy it's sometimes you present your information, there are really qualified prospect, it seems like it's, this thing is going to be a good fit for them, they say I don't know and they really hesitate about saying yes, I will take it let's do it here's my money let's go write anything that causes a qualified prospect to still be sitting across the table from you, right? So they're still engaged, they're still interested they're paying attention, but they're telling, you know, they're saying I don't know if this is the right thing for me anything that causes that prospect to do that is called a barrier to purchase. So the process of selling there's there's, there's an aa an old maxim I I have at the top of the work, but page here is selling begins when the...

prospect says no if they just say yes to you right away there's not much of a sales process rights like, do you want this thing? Yes, I would like some money great, here you go and then the sales process is done, uh selling as a process really begins when when the prospect hesitates and so we're going to talk about five very specific things five barriers that stand in the way between you and a successful transaction and these barriers are universal they show up in all sorts of different types of businesses, so because they're universal, you can anticipate them and prepare answers for all of these questions internet so the first barrier to purchase is it costs too much I it if the prospect is spending money and they are concerned that they're not going to get as much of value out of the purchases the money they're giving up or they're hesitating there that's a barrier because in order for someone to give you money for what they have, they have to value what you have more than the money than they currently have in their pocket, right? So the barrier to purchase of it costs too much is a value challenge, right? They want more information about how this is going to be more valuable than the price that you are asking for, right? The second barrier purchase is it won't work. I don't believe that this thing will work or give me the result that you're saying it will and that is asking for stories asking for narratives tell me more about this thing working for somebody right? The third is it won't work for me right? So I believe it's worked for other folks. You can tell me all of these stories about how it's worked for other people. I don't believe that it will work for me. I don't think it will give me the result that I'm looking for, right? This barrier is looking for a little bit of customization, right? Help me visualize which we talked about yesterday in the marketing process helped me visualize what my life is going to look like in a way that I can actually see myself taking full advantage of right number four is I can wait. This is an urgent that's interesting I don't believe that I really need to buy right now or I'm just looking, how many times have we heard that? Just getting some information and just looking nice to meet you? I don't believe that I need to make a purchase decision right now. The way to overcome this particular barrier is to help the prospect of visualize what happens if they wait. What happens if they don't go forward with the transaction right now? What's the cost? What are they giving up by hesitating? Right? So in the case of photography it maybe you know what busy season's coming up and I'm going be fully booked if you wait, I may not be available for you that's a cost right? If you don't make a decision right away if I'm your force choice photographer I may not be available to you, right? So help them visualize what the cost of waiting actually is. Okay? And number five is it's too difficult it's too hard. Too much time. Too much energy. Too much effort. I'm busy. I don't have time for this. Help them understand just how much time and energy and attention is required for them. And if you're paying attention to the hassle premium that we talked about yesterday, the more things that you can do to make their life easier in implementing this thing, the higher the value it is and it breaks down a major barrier to purchase. Okay? So when you're in a sales conversation and someone voices one of these five common objections, there are two things that you can do to break down that barrier that standing between the both of you and successful transaction, the first thing you can do is convince them that the objection isn't true, right? So I hear you. I hear that you have this hesitation or this concern. Let me help you understand why that's not actually the case, and you can give a story or example, or provide more information or education because prospects have misconceptions about what things actually look like and that goes back to education based selling part of your job is a sales person is to help the other prospect up the prospect really understand what this looks like right? So you can convince them that it's a misconception this isn't true this is what it actually looks like for you can convince them that their objection or hesitation isn't relevant based on what they value or based on what they want right? So in the case of waiting four to six weeks for photography that may be a barrier to purchase right but it's not because by waiting to get a higher quality product and four to six weeks compared to looking at these pictures for the rest of your life it's not a big deal and it's a benefit because you're spending so much more time and attention on them then they would get going with anybody else it's a benefit it's not a drawback right? So if the prospects still doesn't buy after you overcome these these these objections you can ask straight out what's holding you back what are you concerned about? And then the key is as you're asking, you can ask okay, I I hear you have a question about this if I am able to answer this question to your satisfaction are you in a position to move forward with us? And that question is really important because sometimes people will voice an objection and you ask that question to say no not really what I'm really concerned about is this and you're trying to get to the root cause what are they really concerned about if you could get to the root cause of the concern and answer that to their satisfaction they will buy make sense okay so sales is in the process of identifying barriers to purchase helping them understand that is either not true or not relevant in your case and identifying the root cause objection and making sure the customer understands why you're the best option for them that's it that sales no pushing no high pressure it's not yucky at all it's listening it's asking questions and it's making sure the prospect understands why you are the best option for them that's it makes sense one key thing that I learned because in a objection I would run across that would meet with the bride and she's like ok well this sounds great but I want to talk to my fiance and I need to talk to my mom I need to talk octu purse strings essentially and starting out now when I come do any consultations I say it's critical that all of the decision makers come to the consultation because that takes that issue away so I don't have to go there like I need a chat with this person and in my head I'm like well that person should have been here right? You can't say that to them, so now you just use it by saying telling them at setting the expectation that before they ever show up that everyone who needs so big, that position comes to you and if you make it a family event like to meet the photographer and meet the family and all of these things, it also feels a lot less like a sales prospecting call and it feels more like a hey let's, meet everybody and make sure everybody is really excited about this very important part of a very important event that's coming out don't make upon now. One of the major barriers to sales of any kind is the risk that on the on the part of the prospect, if I buy this thing and it doesn't work out, I'll have wasted my money, I'll feel stupid and I feel really bad that I made this decision and I'm worried about that. So as long as I'm worried that this this offer is is not going to work out it's not going to be right for me or is not going to be a good decision when I hesitate to buy that risk is one of the primary, if not the primary buried to purchase that you will always find the risk of the percy verse of making a bad decision okay, now here's the thing if this risk is always there it's a big risk on the part of the purchaser right? Because they're only purchasing from one person hopefully they're purchasing room from you, right? But as a business person you are hopefully selling lots and lots of people who all have the same concern, right? So one of the things that you could do as a business person is take on the risk of a bad purchase decision, take it from the prospect and bring it on too yourself if this doesn't work out for you if it's not right for you if it doesn't work if you're not happy with the results, I will cover that risk for you so you don't have to write this is an idea called riskreversal comes from ah really great book business teacher jay abraham wrote a book called getting everything you can out of all we've got I believe and he calls this idea riskreversal you are reversing the risk you're taking the risk from the purchaser that things aren't going to work and you are voluntarily taking it on to yourself so riskreversal looks like one hundred percent money get back guarantees for long periods of time uh, it looks like if something doesn't work, we're going to make it right in these very specific ways any form of a guarantee or we will make it right kind of deal is a form of riskreversal and that's really important because since you're selling to lots of different people it's a little bit like insurance, right? Remember we were talking about yesterday about spreading the risk of something bad happening across the large group of people riskreversal is doing that for your prospects, right? You're probably going to have a couple prospects for whom it just doesn't work out, right? Something goes wrong, something breaks, expectations aren't met, whatever it is, it will happen right? That it only happen to a couple of your prospects write to them it's a huge deal because their whole experience was ruined to you, it's a fraction of a fraction of a fraction percent of your customer base. So the neat thing about riskreversal is by offering the money back guarantee by offering, though we will make this right no matter what guarantee you are removing that risk the biggest risk to a sale of the biggest barrier to purchase across all of your customers, and as a result, you make way more sales than you would otherwise. All right, so even if one of the things that goes wrong costs you money, you've made so much money from increased sales that you can you can afford to cover the cost of that risk, right? You can see this everywhere, right? So actually, my my favorite example industrywide is the betting industry you see, like really crazy one hundred ten percent money back guarantee you can sleep on this thing for a year and if you don't like it you can bring it back a year from now on we will take it back and we will give you more money than you spend you can like the guarantee right in that case the giving more money that that then the customer spent like that's that seems like a fraud risk right? Why don't why doesn't everybody just go to the store get a bed sleep on it for a year return it and get more money than they paid for it right? Yeah the household people don't do that right but here's the thing the betting industry sells so many much more product because they offer that guarantee because in the minds of the prospects if it doesn't work out it's not going to be a big deal they'll be taken care of right now as a business person it feels really risky to offer this right because there's a phenomenon called loss aversion human beings hate to lose stuff right that's the reason that customers hesitate as business people we hate the loose things to so if it doesn't work out when we're out money and we're out time we don't get paid feels really bad but by offering that guarantee you make so many more sales that you would otherwise miss that as a result you are way better off offering the guarantee that not I looked at the end of the year at my oh my discretionary purchases for the year through mint dot com and just that so I'm going to do every year and I noticed that the top vendors every year are things like ari I and costco of things that offer that hundred upset lifetime whatever guarantee I can always take it back and one sharp decrease and noticed was group on because they've really scaled back in terms of their they're riskreversal policy and that's what I found that I spent a tenth as much as I had when they had a really generous policy yeah when one of my favorite new businesses uh as business called indo chino which does menswear actually I'm this this entire outfit comes from india chino dot com I bought it online I've never seen it which if you think about it selling clothes completely online it's like it doesn't even make sense right because all you're seeing is a picture and you click a button and it shows up at your door but they take your measurements and they make the clothes and they ship it to you and their guarantee is twofold so in their case if if you get the clothes you try them on and they don't fit or they messed something up in in the the fitting or that we're the cutting of it you can take it to a local tailor tto have it altered and if you have to do that, they will cover up to seventy five dollars of the taylors fees in order to make it right, right? So that's a make it right guarantee if that still doesn't work, you can ship it back to mendocino and they will make it over from scratch, and they will continue this process until you are deliriously happy with the clothes that you got from them. So it's the kind of thing where feel it feels like a business that shouldn't work almost right, buying custom clothing on the internet and the on ly reason it works is because they're riskreversal guarantee is so strong is like, well, I'm going to try it, and if it doesn't work, we'll make it right uh and it'll be fine. Um, so the risk reversal was what got me to try it, and now I've purchased probably way too many clothes from them because they're legitimately awesome, but without the riskreversal never would have got the first sale like nordstrom exactly north from built their entire business on this right? So as a general rule, if you can offer riskreversal it's worth it, don't you do something like that when it comes to service, um, you can require being creative, so a lot of it is I mean, the easiest thing to do and the way that I usually like to frame it is if you if if a customer is not absolutely satisfied with the offer in any way, shape or form then I I usually talk about this in the first person so if you buy something from from me and you are not absolutely thrilled satisfied with what you purchased, I don't feel I've earned your money and therefore you get a full refund, no questions asked and and that's a lot of that it's it's riskreversal as a strategy but it's also something that I personally feel if you're not happy I've not provided value and I haven't earned the money so you get back um that is probably the most straightforward thing that will work for even something like a service business I shoot your wedding, you get the photos, you don't like it, you don't pay me and it feels you have to get the photos back no, actually I would I've had this I did a I've done a couple of courses or e books or things there have been folks who purchased it and read it and didn't like it didn't find it valuable like keep it keep the course sorry you didn't find a valuable here's your money back you're not on anything and that's the guarantee and yeah, you lose money on those customers but yourself so many more that it is always worth it ok, one more idea in sales and this is a sales optimization strategy so how you can make more money at the back end of your sales process and this is we talked a little bit about up cells earlier like can you sell the same customers mme or things that are related that they're also going to be uh be interested in reactivation is the process of convincing past customers to buy from you again, right? So when somebody's purchased from you you know they're interested in what you have to offer you know, hopefully they've had a really wonderful experience with you and you know, you probably have the contact information and permission to follow up with them at a later time so reactivation is just the process of going back to all of your old customers and presenting them with a new offer hey, we have this new product hey, we have this new service hey uh actually netflix has anybody ever subscribe to netflix and then canceled? They are brilliant at doing the systematic what what do you get in the mail? Let's remember canceling and I was like, ok, I'm not watching enough this is maybe not worth the investment and I remember getting the email said, hey antonio, we've missed you I want you to come back, but when you come back we're going to discount your prize from this level teo here for the exact same services yep so for me was a no brainer like oh I leave you yeah and you actually give me a discount s oh yeah and I'm still a netflix subscriber absolutely and why did they do that right they give you massive discount for canceling doesn't make sense right why why would they do that? Give me back to reactivate to retain me earn my trust enough I guess for me was like wow this company this even with the big massive company took a moment to re engage me to see how he's doing and say hey, we care about your business so much yeah they're gonna give you disco and as if on a pure financial basis basic math some money is more than no money right? So it's better for them to have you back as a subscriber at a reduced price than for you to go away completely so netflix systematically will after you cancel, you'll get every about two to three months you get an email you'll get something in the mail you'll get a promotional offer you get in and out announcement of something else that they rolled out they use their past subscriber base as their primary marketing channel to get old subscribers back in because everybody knows who netflix is what they does what what they do why it's valuable and they have their contact information it's the cheapest form of marketing netflix fast so they take full advantage of so if you have a group of past purchasers of whatever it is that you're offering going back to them on a consistent basis and letting them know that you have new offers they may be interested in is the quickest, easiest and cheapest way to improve yourself all it takes is a little bit of time and energy going back to that database of bath of past customers and making an offer that's probably going to be great for them make sense okay that sales any questions before we move on to value delivery said to that as well it'll be like get one hundred twenty percent or some like that you talk more about like the limitations of that and where it goes you mentioned that one big part of it was like the match is industry it was sort of like the half there's a hassle factor there's a high hassle factor you can get away with doing it if there's like absolutely no household factor can you still kind of get away with doing it? Yes you can go and if you push it you have to test to see how far you can push it before it becomes potentially an issue but but a lot of folks you know if you push it far enough uh it actually becomes a really remarkable thing about your business in and of itself right this this person or this business believes in this offer so much that they are offering this absolutely crazy guarantee that we have never seen anywhere else in the history of the world because they're confident that if somebody buys that it's going to be worth it, right? So at a certain point it becomes really valuable, you know, if you if you're offering a five hundred percent money back guarantee buying from you and returning becomes better than investing in the stock market, and that is probably going to be a concern at some point. Um, so having tested to see exactly where that threshold is, usually what at what I found is offering full money back guarantee no questions asked is the baseline minimum like, if you're only going to do one thing, I guarantee that and then if you want to push it a little bit a little bit higher tio to see how it performs, then yeah, experiment with it and one additional piece of friction you could say happy to give you full money back guarantee just have a conversation with me about what it might do differently. Yes, yes, so just a little bit and that's what that's a really great way of getting feedback from customers writes like this didn't work from you for you, I want to understand why so I can make it better and if you do that in your guarantee it's also a signal that you really care about the quality of your product right if this doesn't work I want to know why because I want to fix it and that combined with the guarantee is both risk reversal and the signal that you're seriously committed to the quality of what you're offering and reduces abuse because people who are abusing the system aren't really interested in and getting a successful product they're just interesting tax system exactly just have a question coming in this's from online from sam cox is a really good question as it relates to reactivation and he asked if some old customers haven't done repeat business with you because they're unhappy with you how can you find this out and what can you do it yeah so uh the actual tactics will be pretty industry or or market specific you know the most the best thing you can do is have some type of follow up process and we'll talk about this in value delivery but when you're serving a customer having a process to follow up with them to see how they're doing is really really important because if somebody is not happy you can catch that very quickly so customer satisfaction surveys followup calls um there is so so for example my wife and I just purchased a house and we had blinds installed because windows kind of needs in covering right uh the guy who we who we purchased the blinds from and installed them followed up with us a week and a half later saying hey how's everything going everything working is there anything wrong that needs to be fixed and just that follow up call took him ten seconds but we felt were very taken care of and if something was wrong he was going to get very, very quick feedback while he was still in a position to fix it right? So it's a little bit difficult to identify if two years down the road you haven't talked to them they're not happy for whatever reason just offering a reactivation offer you'll get a lot of feedback about who's happy with you it is not it's funny I think about calls I received for purchases have made okay how's everything going antonio my things are going great why are you bothering me? Yeah on and there are lots of different ways different ways to do it and actually the things that that necessitate a high value if you are a high contact approach like a personal visit or like a phone call are the higher end purchases, bigger ticket price types of things um for some of the lower things just just name out how's it going wanted to hear wanted to check in um hope you're enjoying this purchase thanks so much for purchasing less that's that's all it takes just one more quick question from one line and this is a consistent theme from a lot of you out there is how do you guarantee that someone will not take advantage of your riskreversal offer from if I'm hearing you correctly is like deliver a darn good product yes be very, very careful and make sure that you were delivering quality and just notice the framing of the question right? How do you guarantee someone is not going to take advantage of me that's the loss aversion talking right how do you make sure that I am never ever going to lose anything from offering this policy and it's this is one of the most uncomfortable things that you could do in the in the sales process no joke it feels like you're really putting yourself out there in a very uncomfortable way what really helps and it takes a while to to feel this in your gut by doing this you are you are allowing more people to purchase from you and in the end you are going to be better off even if a few people do take advantage of you and if you offer this type of policy particularly if you do a crazy one people will take advantage of you right it's going to happen what we're saying is a couple of people taking advantage of me is not a big deal if I self two or three or four times mohr prospects, because they are no longer concerned about the risk of a bad transaction, go more risky in the case of some service business that in something that's. Evergreen. Yes, I needed thinking one up for my own business. Not specifically. The wedding side concerts, that's, trickier, but for, like, portrait stuff, offering a money back guarantee on my session fee. If there aren't five images in the final collection that I show you that you absolutely love already found your concession fee on, and they're going to be five images because their emotional and I'm a good time for. So I'm right. Where it exactly now, exactly. So you, khun, with full faith and confidence, say, I am guaranteeing that you were going to get a result that you like, and if you don't like it, for whatever reason doesn't matter, let me know what I could fix, and you're not on anything.

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