Negotiation & Objection Handling: 10 Tips for Getting What You’re Worth

Dan Thompson East Sales Director, Smarsh

November 20th, 2014

Negotiation & Objection Handling

Tonight’s Agenda

I.  Objection Handling vs. Negotiation

II.  5 Tips for Overcoming Objections

III.  5 Tips for Better Negotiations

IV.  Brief Summary

V.  Q&A

Objection Handling vs. Negotiation

Objection Handling: •  Addressing your prospect’s concerns about your product or service in order to create

technical, organizational, and personal buy-in

•  You are still selling at this stage in the process

Negotiation: •  Attempting to reach mutual agreement about the value of your product or service

•  You have already been selected as the vendor of choice

Remember: Don’t negotiate before the prospect is sold, and don’t revert to “selling” once you’re in negotiations

Overcoming Objections

Objection Handling: Tip #1

Learn From Your Losses

•  Review your lost opportunities over the past year and look for themes

•  Which objections came up most often? Which ones were the deal breakers?

•  What areas will require product development? What can you work or talk around?

•  Review your near-losses and close calls; opportunities you won but almost didn’t

•  What were the biggest hurdles to closing the sale? How did you overcome them?

•  Use these insights to create a “cheat sheet” of common objections and craft 2-3 potential responses for each. Test them out and revisit them often.

Objection Handling: Tip #2

Understand Your Prospect’s Real Concerns

•  Why is the objection an issue for them, and why are they bringing it up now?

•  No assumptions. Guessing at the prospect’s intention can put the deal at risk.

•  In order to truly understand, you must:

•  Validate and acknowledge the prospect’s concern (nurture) •  Understand the problem they’re facing and the reasons behind it (ask why?) •  Respond only once you’re sure you understand the real concern

•  Never answer a question without understanding the context behind it!

•  When in doubt, place the ball back in the prospect’s court. It’s their job to clarify.

Objection Handling: Tip #3

Stop Putting up Speed Bumps

•  All prospects have a vision of their ideal solution. This gets them ready to buy.

•  Your job is to help them realize that vision, not distort it.

•  Salespeople distort their prospects’ visions by:

•  Answering un-asked questions •  “Pitching” unwanted features and benefits •  Generally misaligning your solution to their pains or use case •  Saying anything that creates unnecessary risk in the prospect’s mind

Objection Handling: Tip #4

Go for the “No”

•  “Is it over?” “is this going to be a deal breaker?” “should we just call it quits?”

•  “Walking away” tests an objection’s importance and identifies the prospect’s real concern

•  When there’s a particular objection that comes up repeatedly, don’t wait for your prospects to bring it up. Get it on the table early and seek resolution.

•  This builds genuine credibility and rapport

•  Don’t worry: Just because you’re walking towards the door doesn’t mean you have to go through it... unless, you want to.

Objection Handling: Tip #5

Understand That Pricing is NEVER the Real Issue

•  There is a direct correlation between pricing and conviction (value)

•  Less certainty your product will solve their problem means greater pricing pressure

•  Solution: Learn what your prospects would need to see to justify paying more, then show them you can deliver (ROI)

•  In other words: Let your prospects answer their own objections.

Better Negotiation

Negotiation: Tip #1

Have a Game Plan

•  Determine your pricing “envelope” – your best, worst, and most likely scenarios

•  Create a list of potential negotiables – setup fees, minimum commitments, etc. – and assign trading values. Remember that contract terms have value too.

•  Know your non-negotiables and stick to them

•  Remember your prospects will have their own envelope and negotiables too.

Best  Case  Worst  Case  MOST  LIKELY  

Worst  Case  Best  Case  MOST  LIKELY  

Negotiation: Tip #2

Consider Your Prospect’s Environment & Business Drivers

•  What do you believe is of value to this particular prospect? Why?

•  Internal & external factors influencing their decisions may include:

•  Buying team, business challenges / goals, and individual motivators •  Short- and long-term strategy – expansion, relocation, new technologies, etc. •  Competitive pressures, market trends, and general business environment

•  Determine their most likely alternative – a competitor, develop in-house, or doing nothing

•  What unique advantages does your product or service provide? •  This will determine how much leverage you have

Negotiation: Tip #3

Never Give Anything for Free

•  Always get something comparable or greater in return when you give concessions

•  Know what items could sweeten the deal for you:

•  Commitment to sign within an agreed-upon timeframe (EOM, EOQ, etc.) •  Longer initial term (annual vs. monthly contracts, multi-year agreements) •  Case study or reference account, use of logo in marketing materials •  Introduction or referral to other potential clients •  Better payment terms (upfront vs. monthly payments, shorter collection times)

•  “Freebies” lower your solution’s (and company’s) perceived value

Negotiation: Tip #4

Know When NOT to Negotiate

•  Providing certain concessions create undue risk to the business, regardless of how much you may want the deal, the new logo, or the revenue

•  Owners and Sales Managers: It’s your job to know when these times are.

•  Set guidelines, implement check-and-balances, and stick to them.

•  This is easy if you’ve done a good job creating your pricing envelope and valuations

•  Live to sell another day…

Negotiation: Tip #5

Quarterback the Process

•  Consider the various buying centers involved: project sponsors, technical buyers, legal, procurement, etc.

•  You must always be working these functions in parallel

•  As the seller, it is your responsibility to drive the procurement process

One Final Tip:

In Summary

Successful objection handling and negotiation ultimately comes down to:

•  Knowing yourself, your customers, and your marketplace •  Remembering that “pricing” is really about conviction

•  Having a game plan and never giving anything for free •  Owning the process and maintaining control

•  Never taking things personally

Questions?

Thank You

Email: dthompson@smarsh.com

Connect on LinkedIn

@dethomps8069