The Money Question

Economic Perspective in Perspective

I love working with talented sales professionals. One of my favorite training exercises is to work around the room and ask this simple question: How much is “a lot of money” to you?

Talk about fun! (If you’re a sales trainer you really have to try this one.) Although I have conducted this group training exercise countless times, I am always amazed by the scope of the responses. Invariably, the figures offered by a group in response to this “money question” tend to range all over the place—from fairly frugal (I couldn’t resist) amounts to darn right large impressive sums.

In fact, one small group of about a dozen salespeople from Greensboro, North Carolina, actually responded from a low of five dollars to a high of fifty-million dollars! No kidding. It was pretty remarkable. I remember thinking to myself (during an apparent flashback moment to the days of 50’s sitcom speak), “Gee-wiz! Could the disparity in these answers be any greater?”

“So what’s the point of the exercise” you ask? Well, here you go. The money question clarifies the importance of understanding your prospect’s economic perspective.

“Economic perspective” defined

Each of us has our own individual concept of what “a lot of money” means to us—a financial viewpoint framed by our unique past and current relationship with money.

For example, if you’re currently pulling down a double six-figure plus income, enjoy tooling around the neighborhood in your paid-in-full red Lexus convertible, live in a multi-million dollar equity-stuffed estate home—and your broker successfully convinced you to move your retirement money into safe haven investments just before the stock market went ka-boom… then you are most likely to answer the money question closer to the fifty-million dollar mark. Make sense?

On the other hand, if you recently experienced the misfortune of standing in line outside the unemployment office, only to enjoy an unobstructed view of your newly repossessed PT Cruiser being towed down the street right in front of you… it may be safe to suggest that five dollars may feel like a small fortune to you in that moment.

Fortunately, the financial experiences of most prospects probably are not quite as extreme as these two examples. But, with that said, it is extremely important to understand and respond in terms of your customer’s economic perspective (not yours) any time the subject of money comes up in the sales process.

Moving right along

When a prospect says something like “I don’t have a lot of money to spend right now”, for one, the statement in context may more closely translate into “I only have a few hundred dollars in my back account right now”. For another prospect, say a bit more “well-heeled” (sort of a throwback expression there, too), the same exact statement delivered in an equally impassioned way, may mean that they are trying to get along with only a few thousand dollars of currently disposable income. A rather big and important distinction, don’t you think?

Now here’s the rub. (Sorry, that one’s really old school.) Unless you happen to be intimately knowledgeable about the details of your prospect’s financial situation before you begin working with them (i.e., you remember reviewing their tax return before being fired from your former position as an IRS agent, or you successfully hacked into their computer last night and stole their identity... that sort of thing), the minute they mutter one of those ambiguous statements about money, you’re probably going to default to using your own personal economic perspective to decipher what you think they are saying—and that could cost you a sale. (Especially true, should you be the salesperson who provided the five dollar answer in the Greensboro session…)

The money question training exercise demonstrates the importance of understanding economic perspective as it directly relates to closing sales. When the subject of money comes up, make sure that you’re clear about what the prospect is actually saying, before you launch into some ill-conceived objection-handling mode, before you drop down to presenting a less expensive item, and before you decide to call it a night and beat a path home in your PT Cruiser.

Disclaimer: The selection of automobile brands or models used within this article was completely random and included for rhetorical purposes only. Thereby, no implied endorsement for any vehicle is made by the author… well, maybe with the exception of the Lexus convertible.

A Study in Cancellations

Preventing Buyer’s Remorse

If you want to find the salesperson in any organization with the highest cancellation percentage, look for the one that boasts most loudly about how great they are at “handling objections” and “closing” their customers. Unfortunately, those that define themselves as “great closers” often have the highest cancellation problems as a percentage of their sales as well.

One of the catch phrases you may hear in business when a customer seemingly cancels a contract for no apparent reason is that they had “buyer’s remorse”. This term is, at best, a weak attempt by the salesperson to shift the responsibility for a cancellation away from them and put the onus on their customer. This really makes no sense. What reason would a customer have to feel remorseful (i.e.; guilty, regretful, etc.), provided that they have made a decision to buy something based upon receiving all the information they would need to make an intelligent decision in the first place?

Cancellations, plain and simple, are frequently a byproduct of poorly executed sales presentations bolstered by hardcore closing tactics. Incompetent salespeople tend to rush through their presentation to get to the “handling objectives and closing” phase, missing countless opportunities to establish buyer need, build maximum product value, and strengthen the overall “buyer commitment” toward retaining the product or service they just purchased.

Realistically, regardless of how good you are, there will undoubtedly be some circumstances beyond your customer’s control that will cause them to cancel an agreement from time to time— an unforeseen financial emergency for example. If you have done your job well, however; thoroughly establishing the benefits of your product or service before your customer says “yes”, it will be far less likely that they will experience any “cancellation remorse” after you have made the sale.

The bottom line is this: Let go of hard core closing tactics and finger-pointing at your customers when a cancellation comes through. Instead, spend more time mastering your presentation and polishing your delivery. You'll not only close more sales, but you will also have far fewer instances of “buyer’s remorse” to have to explain away in the future.