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How do you define the value of your market offering? Can you measure it? Few suppliers in business markets are able to answer those questions, and yet the ability to pinpoint the value of a product or service for one’s customers has never been more important. By creating and using what the authors call customer value models, suppliers are able to figure out exactly what their offerings are worth to customers. Field value assessments-the most commonly used method for building customer value models-call for suppliers to gather data about their customers firsthand whenever possible. Through these assessments, a supplier can build a value model for an individual customer or for a market segment, drawing on data gathered form several customers in that segment. Suppliers can use customer value models to create competitive advantage in several ways. First, they can capitalize on the inevitable variation in customers’ requirements by providing flexible market offerings. Second, they can use value models to demonstrate how a new product or service they are offering will provide greater value. Third, they can use their knowledge of how their market offerings specifically deliver value to craft persuasive value propositions. And fourth, they can use value models to provide evidence to customers of their accomplishments. Doing business based on value delivered gives companies the means to get an equitable return for their efforts. Once suppliers truly understand value, they will be able to realize the benefits of measuring and monitoring it for their customers.
“Everything is worth what its purchaser will pay for it.” How do you define value? can you measure it? What are your products and services actually worth to customers? Remarkably few suppliers in business markets are able to answer those questions. And yet the ability to pinpoint the value of a product or service for one’s customer has never been more important. Customers—especially those whose costs are driven by what they purchase—increasingly look to purchasing as a way to increase profits and therefore pressure suppliers to reduce prices. To persuade customers to focus on total costs rather than simply on acquisition price, a supplier must have an accurate understanding of what its customers value, and would value. A version of this article appeared in the November-December 1998 issue of Harvard Business Review.
The goal of every sales effort is to close. Salespeople don’t just prospect, cold call, research, serve, negotiate or present. Those are all just steps toward the one outcome they want: a closing. The best salespeople put customers’ needs at the heart of their efforts throughout the sales cycle. Then the close – that final step in the sales process where the prospect agrees to complete the deal – is the payoff for all the time and effort. While sales close rates vary from industry to industry and company to company, the sales professional can agree that they’d all like to close more deals and more often. More than 70% of salespeople say closing more deals is their top priority. In sales – and especially in closing – knowledge is power. Here’s your bible for closing the sale. RETURN TO INDEX
Salespeople who close more deals than their average colleagues might work a little harder or smarter, but what often casts them apart are unique approaches to attitude, confidence and enthusiasm. Here’s what’s at the core of top closers:
“Salespeople today are the differentiator,” says Jill Konrath, author of SNAP Selling and Selling to BIG Companies “That’s why it’s so critical for you to focus on becoming a valuable business asset to your customers.” RETURN TO INDEXHABITS OF TOP CLOSERSWhile attitude is important, so is action. Top closers have some common habits that you can pick up, too. “Motivation is what gets you started. Habit is what keeps you going,” said business expert and entrepreneur Jim Rohn. The most common habits are:
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The importance of closing remains the same in every economy. While the circumstances change, the “rules” – the pillars that build solid relationships and close sales – remain relatively the same:
Thus, salespeople who develop strong relationships with prospects who want relationships, deliver effective solutions to prospects who need solutions, deliver greater value to those prospects who seek value, and offer a speedy transaction to those who seek a quick solution, will close more. 6 fundamentals for closing every saleSalespeople don’t want to walk away from any sales calls without establishing the answers to these six questions. They’re the fundamentals to become a master closer. Ask yourself:
If you answer no to any, you can clearly see where your closing techniques need to be spiffed up. RETURN TO INDEXEXERCISES AND STRATEGIES TO GET MORE CLOSESClosing isn’t just a physical, paper-laden, hand-shaking game. It’s a mental game, too. And just like in any professional or amateur sport, salespeople can up their closing game by training and exercising. These exercises and strategy-sharpeners will help: Mental exercisesTop closers are confident. But confidence doesn’t always come easy. Even the most successful salespeople need to take steps to hone their confidence or exercise their way out of a slump. These mental exercises will help.
Emotional exerciseSuccessful salespeople tap the power of their emotions to help close sales. Making emotional connections can impact confidence and take optimism to a deeper level. One way:
“The best salespeople know that their expertise can become their enemy in selling,” says Mike Bosworth, author of Solution Selling. “At the moment they are tempted to tell the buyer what ‘he needs to do,’ they instead offer a story about a peer of the buyer.” Physical exerciseSometimes it takes actual action to regain or build confidence or overcome a fear. Then closing becomes even smoother. One way:
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Most top closers know more about connecting with people than online matchmakers do. They take strides to connect at a granular level, finding what’s unique about each person and his or her needs. At the same time, they share enough about themselves to make prospects so comfortable they open up and share their stories, struggles and needs. Make connectionsHere are three keys to making connections and building relationships that lead to closing.
Maintain connectionsThe road to closing can be long. And even if it’s short, it’s important to stay connected with prospects so then the closing situation is as amicable as friends enjoying beers and professional as a businesspeople meeting. To stay connected:
“It is not your customer’s job to remember you. It is your obligation and responsibility to make sure they don’t have the chance to forget you,” says Patricia Fripp, a sales expert, coach and author. Stay connectedClosing the sale is just the first step in closing the next sale. It’s important for salespeople to stay connected after the sale. A few ways:
“The modern sales professional doubles as an information concierge – providing the right information to the right person at the right time in the right channel,” says Jill Rowley, Chief Growth Officer at Sales for Life. RETURN TO INDEXGETTING AT THE FINANCIALSOne of the most difficult conversations to have during the sales process is the financial one. It can stop or delay a closing or create a contentious one. Talking money will almost never make a closing easier. Fortunately, there are some tactics the best closers use to handle the financials. 3 principles behind talking money
Make the numbers palatableTalking money is often the most awkward part of getting to a closing. Many people are as uncomfortable with talking about money as they are about discussing sex, politics and religion – the conversations we’re told to politely avoid early in our careers. But to close a sale, money is a necessary conversation. Here are tips on how to make it comfortable and concise:
Get the numbers you need to closeCustomers won’t tell you how much they want to spend, especially if you ask them questions solely aimed at uncovering that amount. To move toward closing, salespeople want to help prospects determine the amount it would take to eliminate a problem or gain an opportunity. You need to avoid questions like these:
Instead, figure out the answers to these questions to get you the financial information you need without putting customers on the spot:
When you know the answers and then help customers realize them too, the price of your offering becomes a simple fact that can easily be evaluated. RETURN TO INDEX
A trial close is a test to see how near the prospect is to buying. You can try it any time prior to the close – and might get you to an actual closing sooner (or recognize that a sale isn’t worth pursuing further). In a trial closing, salespeople can find out what prospects think and feel – and how to adjust your presentation accordingly. Uncover objections earlyTrial closes often work because salespeople can uncover objections that prospects might not bring up during a presentation, but would just before a closing. You can get at them with questions that probe prospects’ opinions. Try these:
These questions tend to flesh out prospects’ thoughts and feelings and give salespeople a read on how much they want or need the product or service. Ask the trial questionWhen there’s a positive reaction to the trial questions, salespeople want to follow up with a trial closing question such as:
RETURN TO INDEXSIGNS YOUR PROSPECTS ARE READY TO CLOSE – AND HOW TO REACTProspects sometimes give signals that they’re ready and willing to close before they actually say, “Let’s do this.” When they start giving the signals, salespeople want to avoid becoming aggressive. Instead, let prospects ask what they need to ask and respond with more detail. What they’ll doLook for prospects to:
What they’ll sayProspects will also say things that signal they’re just about ready to close. Listen for them to:
Remember: When customers signal they’re near ready to close, avoid hard selling techniques. That can push them the opposite way. RETURN TO INDEX
Even the best-qualified prospects balk sometimes. They might seem interested, but in reality, aren’t as serious about closing as you are. It’s important to understand why prospects balk and recognize when they’re doing it so you can either double-down your efforts or walk away before wasting their time and yours. Why they balkHere are some of the most common reasons prospects delay a decision to close:
“The trust that a customer has in your company and in you strongly outweighs the techniques you use to sell,” says Mike Puglia, Chief Product Officer at Kaseya. “Establishing trust is better than any sales technique.” How they’ll balkWatch for these signs that prospects have lost interest or are changing their minds:
Tips to bring them backWhen you identify the prospects who are worth more effort, try these tactics to re-interest them in closing the sale.
RETURN TO INDEXGETTING A COMMITMENTThe best closers focus less on closing and more than on obtaining a commitment. Commitments change behaviors for the better: Prospects are more likely to do what they say they’re going to do when salespeople do what they say they’re going to do – a commitment on both ends. Be ready for ‘but’To get and make commitments that are precursory to closing:
Use closing questionsNow’s the time to get comfortable asking closing questions. The higher your level of comfort, the less likely you’ll appear too pushy or aggressive, which makes prospects comfortable. Commitment questions should seem like a reasonable request from customers’ perspective and not just your perspective. There shouldn’t be any anxiety – just comfortable questions that lead from one step to the next. One of the easiest ways to be comfortable with your closing questions is to use the sensory trial close. You create closing questions that use the words who, what, where, why, how much and when, in combination with sensory words like look, think, touch, sound, feel and view. When you ask questions in this format, prospects are usually comfortable answering. Examples:
Test the commitmentYou will increase your closing ratios dramatically if you test the seriousness of prospects commitment. Here are four tips to do that:
Finalize the commitmentOnce customers have verbally committed, you want to create clarity about what you’ll do now to further the sales process and finish the close. Use a closing or commitment question that gets at a specific action the prospect is likely to agree to take because it makes sense considering what you’ve discussed and agreed to happen. For instance:
There’s incredible power in commitments. Most prospects who make a serious commitment will keep it. But you have to establish a hard commitment. RETURN TO INDEX
There’s no perfect formula or phrase for closing sales. For the most part, closing is situational. Sales professionals need to ask for sale based on the relationship they’ve established, the circumstances they face and the situation they’re in. Bottom line: Salespeople need to read the situation and ask accordingly. 25 ways to askWhile there are as many ways to close the sale as there are circumstances surrounding it, here are 25 phrases to use to ask for the close:
RETURN TO INDEXANALYZE THE CLOSE (OR THE FAIL)When the hard work of one sale (or disappointment of a fail) is over, the learning just begins. For salespeople, it’s critical to analyze closes that are won and near-closes that were lost. It helps you close the next sale. Understand the winResearching wins as well as losses ensures that you receive a balanced perspective so you can continue successful practices and eliminate those that lose sales. Even better, customers are more forthcoming with salespeople they have chosen to do business with. Five reasons:
Understand the failClosings often fail for these seven reasons. Salespeople:
Get the feedbackGet post-closing (or post-fail) feedback in the format that each customer is most comfortable giving it – email, online, written survey, phone call, in-person. Include these or similar questions:
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Regardless of industry, product, economic conditions or times, some things hold true. Here are eight universal closing truths that work in any sales environment Truth #1 Prospects listen to what’s important to themProspects pay attention to someone who they believe has something important to say to them. Today’s prospects look to buy more than a product or service. Being viewed as an industry expert or advisor gives salespeople greater receptivity, wider and freer access to decision-makers at higher levels, and a stronger series of sales opportunities. Truth #2 Prospects buy when they’re ready to buy, not when you need to sellIt’s important to be in front of qualified prospects when they’re ready to buy, not when you need to make a sale. When and whether prospects will decide to buy anything has more to do with their schedule than the schedule of any salesperson. The key is to have a sufficient supply of qualified prospects and then be the one who’s there when they’re ready to make a buying decision. Truth #3 Closing is more about listening than telling“Listen” prospects into buying instead of talking your way out of the sale. Closing isn’t only about telling, presenting and verbalizing. It’s about asking questions, recording the answers, accurately listening, and allowing prospects to tell you exactly what, how, when, why and under what conditions they’ll buy. Truth #4 All prices are too high, but you can’t put a price on valueTo prospects, any price is too high until they understand the value of the product or service. To deliver value, salespeople have first to understand what the prospect perceives as value. If salespeople prematurely quote price, they’ll never have a chance to create value and close the sale. Truth #5 Needs and benefits must be alignedPresentations need to be tailored to prospects’ needs and wants, not the salesperson’s. This requires the capacity to understand how a prospect wants to see your product or service and present it in exactly that way. It requires total mastery of product knowledge, extensive pre-call planning and questioning, and a presentation that can be tailored, customized, altered, modified or totally overhauled instantly to reflect prospect needs. Truth #6 Reputation makes all the differenceThe jump from character (what you are) to reputation (what people think you are) is much smaller than some salespeople believe. Good salespeople know that in tight, crowded markets, their solid reputation is a powerful tool. It will help them prospect, market and close better. A poor reputation can be devastating. Truth #7 Salespeople must believe firstCustomers will never believe in the value of your product or service any more strongly than you do. Closing is all about believing that your product or service is a true value that delivers the promised result. It’s critical for salespeople to believe that the product or service they sell is exactly what they say it is and will perform exactly the way they say it will. Truth #8 Trust, sales and relationships are built on truthsSalespeople can’t make claims they can’t back up with facts. Prospects expect salespeople to make claims for their product or service. They are more impressed when salespeople provide testimonials and research to corroborate their claims. Top closers work hard to get other sources to verify that the things they say about their products or services are true. |