How many of us have heard from prospects, "Your fees are too high," "Someone else will do it for less," or "I don't see why I have to pay all that money just to have you do an audit, write a brief, create a marketing plan, etc.?" And, more important, how many resist the urge to simply lower our fees to get the work?
The answer: all of us and few of us. The problem with lowering our fees for a particular piece of work is that we have forever established our value as that lower amount. As our anonymous friend said, if we put a low value on our own work, certainly no one else is going to suggest our value is any higher.
Why do so many of us fall victim to these worst tendencies? To answer this we first have to look at objections in general and how they fit into the selling process for professional services.
Most sellers see objections as a sign of rejection or a call to do battle. With this attitude, it is no wonder we usually handle price objections poorly. However, when we break it down you can see that objections can be overcome without a battle.
Objection Definition: An objection is an explicit expression from a prospect that a barrier exists between the current situation and what she needs to engage your services. In other words, it is a clear signal that you have more work to do in the selling process.
Your objective: Overcome the objection and make advances towards gaining commitment from the prospect with the following caveats firmly in mind:
- The close begins the relationship: In a transactional sale, sellers are typically taught to overcome objections at all costs. This does not work for more complex sales. If you just plow through the objection without addressing it fully, the underlying reason for the objection will usually come back to haunt you. Remember, you have to work with these people once you are done selling to them.
- Objections often have merit: Most sales training teaches us to “rebut” objections, counter them with logic, arguments, and sheer will power. But objections are often a sign that something else is going on. Your purpose is to understand the objection fully, isolate it, and respond to it appropriately.
- Many objections take a process, not a quick answer, to overcome: The complex sales invovles many buyers and buying criteria. You may need to build a case for overcoming an objection instead of answering quickly on the fly. Some objections, on the other hand, may simply be questions that have yet to be answered.
Getting Closer to the Sale
Objections are not such horrible things. When the prospect indicates that he is not quite ready to sign on the dotted line (he voices an objection), this should not deter you. As a matter of fact, you now have the opportunity to understand your prospect better and move him closer to the sale by following these steps:
1. Listen fully to the objection (don't interrupt or anticipate).
Fight the common urge to respond immediately to an objection. By doing so, you will hear what is actually on the prospect's mind rather than what you think he is objecting to. You will be surprised how much you can learn about what is actually at the heart of the objection.
2. Ask permission to completely understand the issue.
The simple act of asking permission to understand lets the prospect know that you respect his concerns.
3. Ask questions, restate or clarify the objection.
Make sure you get it right and/or uncover the real objection. Many objections are hiding underlying issues that the prospect either can't or is not ready to articulate.
4. Choose your response carefully and keep it short.
Answer honestly and to the point. Long-winded responses very quickly begin to sound artificial and insincere.
5. Propose your resolution to overcome the objection.
Simply enough, describe exactly how you are going to remove the barrier for the prospect.
6. Ask whether your answer or proposed solution will satisfy the objection.
Don't always take an immediate “yes” for an answer. Many prospects will accept the solution in the moment, but once you are out of sight, the objection still remains. Be certain you have moved the sale forward.
And, When Money Is (or Appears to Be) the Objection
In addition to the steps outlined above, to overcome money objections without lowering margins, keep the following guidelines in mind:
- Choose your words wisely. As much as we would like to respond, “You get what you pay for,” or, “Those are my fees and I am worth every penny,” there's no glib, pat answer to money objections.
- It's not all about the Benjamins. Money is often a “red herring” objection. Find out if it is true by asking, “If money were no object…” This will usually bring out the real issues behind the money issue.
- Establish your tangible value. Communicate a clear picture of the value of the solution you established in the selling process – the right buyer can usually “find” the money. Be certain that you have helped the prospect see how the solution you have proposed will answer his needs. Most times when clients say, “Your fees are too high,” what they are really saying is, “I don't see the value of your solution.”
- It's too early in the relationship to be talking money. Avoid engaging money discussions too soon. Fees mentioned out of context of what the prospect is trying to accomplish will always sound too high. If you can delay the fee discussion until you have uncovered all the needs and the impact of fixing those needs, you will increase value perception and decrease money objections.
- Maintain a peer relationship. Don't appear to look upward for guidance at your organization.
- Resist the urge. Don't lower your price without altering your deliverables – being arbitrary creates mistrust and sets you up for lower prices for as long as you have that client.
- Be sure you are dealing with the decision maker. You may be dealing with the wrong buyer who is not high enough in the organization or is not the economic decision maker. Money is certainly an objection for them because they can't pull the trigger even if they wanted to.
In the end, if you believe you have fairly priced your products and services and provided the solution you know will help the prospect and you still hear, “Your fees are too high, can you lower them?” you may simply be a bad organizational fit. If so, walk away. Because if we don't have faith in the value of our services, we can be certain no one else will.