Do I Need Your Product?

Customer objections regarding the product fall into two broad areas that require different approaches to deal with the customer’s concern.

Product Need. First, the customer may not be convinced that there is a need for the product. This is especially true if the customer has never used a product like it. He or she may simply not see the value in buying the product or the need that it satisfies. This view can be summarized as, “We’ve always done it one way. Why should we start something new now?”

Apple is one of the most successful technology companies in the world creating such hugely popular products as the iPhone, iPad and Apple Watch. Many people may not recall that Apple has also had some product failures, consider the Apple Newton. When it was introduced in 1993, the Newton was one of the original personal digital assistants (PDAs) and ahead of its time. Unfortunately, many corporate customers could not see the need for a personal organizer and thought of it as an expensive calendar and meeting organizer. Corporate buyers asked why they should spend $500 for a calendar. Where Apple failed, companies like Palm succeeded by demonstrating these were really little computers capable of many things besides being a calendar. Today, PDA functions are built into cell phones or other mobile wireless devices like tablets or "wearbles" (Apple Watch). The Newton lives, but only with a group of enthusiasts, as Apple discontinued the product in 1998.⁵

Ultimately, customers must see a clear and convincing reason to buy the product. If they don’t, you shouldn’t be surprised if they choose not to buy. Keep in mind that customers are not usually risk takers. With new products they are likely to wonder if the technology is too new or unproven. They may also question if it is significantly better than their current solution. The fundamental question is “Do I really need your product?” Key to the answer is a well-conceived value proposition that explains clearly how the product will benefit the customer and how it will be better than the existing solution.

Your Product Need. A much more common concern regarding product is whether the customer needs your product. Perhaps the configuration of your product is different or your competition’s product has features that aren’t on yours (or vice versa). Almost anything about your product may be of concern to the customer. Careful preparation is critical in dealing with questions about your product’s superiority. This is why you must have a thorough knowledge of your competitor’s products and services.

Since the customer has been using your competitor’s products, he or she knows their configuration, terminology, and product benefits very well. You must clearly define your product’s features, advantages, and benefits (FABs) so the customer will understand the value proposition of your company’s products over your competition. Again, change is not easy, and buying your product means the customer will have to learn a new product, so your value proposition must consider the cost of change. Put simply, your product cannot be just as good as the competition because that will not be sufficient reason for the customer to change. Your product must be demonstrably better.

Do I Trust Your Company?

If a customer asked, “Why should I trust your company?” would you be able to answer? As we have discussed, contemporary selling is based in part on mutual respect and trust between buyer and seller, including trust between the buyer’s company and your company. In most cases customers already have a supplier. They may not be totally satisfied with that supplier, but they’re familiar with them. They know whom to call to get a problem resolved. They are also familiar with that company’s policies and procedures. You must overcome the customer’s reluctance to change suppliers. Research suggests that as sales become more complex (for example, bundled IT solutions) customers demand a higher level of trust with the selling organization. Perhaps this is not surprising given the increased perceived risk and longer term commitment associated with making expensive, highly complex purchase decisions.⁶

There are two types of customer objections regarding the salesperson’s company. Often these two issues work together to create a formidable concern for the customer.

Unease about Your Company. If customers are not aware of your company, they may simply be concerned about your ability to deliver when, where, and what they need. This is a legitimate concern, as they are putting their company at some risk by choosing you as a supplier. They need to know that you will do what you promise in the presentation.

Customers can be concerned about your company for many reasons. If you are small, they may be apprehensive about whether you can deliver what they need or whether you are even going to be in business in two years. If you are big, they may fear they will not be a valued customer. These objections can be difficult to overcome. How can you prove to the customer that your company will be around in two years? How can you demonstrate you will deliver what the customer needs when and where it’s wanted, every time? Perhaps the customer has read or heard something negative about your company.

Loyalty to Existing Supplier. A customer who has objections about your company may be showing loyalty to or satisfaction with the current supplier. The customer may say, “I have been buying from Mr. McAllaster at Steadfast for years and they have been excellent. I never had a problem they didn’t fix.” In those situations it is not that your company has done anything wrong; rather, your competitor has done things right. This problem must be handled carefully, or you will anger the customer and lose the opportunity to build the relationship. Long-term relationships with suppliers can create some challenges for the salesperson. Read the Ethical Dilemma to see how strategy partnerships sometimes present difficult problems.

Directly confronting the customer with negative comments about the supplier will almost surely fail. Remember, customers don’t like change, and speaking critically about someone they have had a relationship with for a time will not endear you to them. The best approach is to stay focused on your product and company.

I Don’t Really Know You

Customers may be concerned about the ability of a new, inexperienced salesperson to learn their business or their commitment to the company. (Is the salesperson going to be there for a while?) The salesperson has to earn the customer’s respect. When salespeople are new, customers may ask to see their supervisor or want someone more experienced to handle their business. In these situations, it is important to be very prepared and demonstrate knowledge of the customer’s value proposition. The salespeople shouldn’t become defensive about their education or qualifications. Rather they should use the concerns as an opportunity to build the relationship and ask those customers to put them to the test. The salesperson is asking for a chance at their business.

Selling is a people business, and occasionally your personality will not be compatible with the customer’s. Keep in mind Henry Ford’s quote: “Stay focused on the goal.” While you and the customer may not be friends or even get along, what matters is the relationship between your companies. Of course, you should notify your manager of the problems and seek his or her help on how to address personal compatibility issues. (We will talk about this later in this chapter when we examine the manager’s role in negotiations.)

Even experienced salespeople run across personality conflicts when they take on a new account. Customers often develop a relationship with a salesperson as well as the selling company. When a salesperson is replaced, the new person and customer will naturally go through a period of getting to know one another. During this period, the salesperson should be supported by management so the customer understands the company has complete confidence in the new person. Some companies rotate the sales force to prevent this situation from developing with customers. The focus should always be on the relationship between the company and the customer, not the salesperson and the customer.

I Need More Time to Consider Your Product

Every day salespeople hear: “I need more time to think about your proposal.” Customers have a legitimate concern about making a purchase decision too quickly. If the purchase involves several parts of the company (for example, the decision to build a new plant or develop a new product), there will most likely be a committee involved in the purchase process. In some industries (defense, airlines), the decision to purchase may take a year or more. Boeing, a world leader in manufacturing large commercial aircraft, is typical. Its Boeing 787 Dreamliner took years to develop, test, and market to commercial airlines around the world. When a customer says he or she needs more time to think about the purchase, it may be true.

However, customers frequently ask for more time because they wish to delay or stall the final decision for several reasons. First, customers may be reluctant to make a decision because of the uncertainty of something new. You are asking them to trust you, your company, and your solution to their problem. While you may know it to be the best solution to their problem, they may be anxious.

The second (and more likely) scenario is that you have failed to prove the value proposition. The customers do not see the benefits of your product over their existing situation. It is important to realize, however, they are not saying no. They are indirectly asking you to build a stronger case for your product. Again, this is an opportunity to build the relationship. Go back into your presentation and ask questions to ascertain the source of the customers’ anxiety. Summarize the value proposition to reinforce the positive results from a purchase decision.

Basic Points in Negotiating Win-Win Solutions

As you have seen, a number of customer objections can affect buyer–seller negotiations. Dealing with these objections may seem like a daunting challenge, but successful negotiations are about understanding the nature of buyer–seller relationships and recognizing some general guidelines for managing buyer concerns effectively. Exhibit 8.2 gives guidelines for negotiating win-win solutions.

Plan and Prepare

Just as preparation is important to a successful presentation, it is crucial to managing customer concerns. Knowledge of your customer, anticipation of your customer’s objections, and a carefully developed sales presentation can do more to resolve customer objections than almost anything else. Keep in mind that the customer knows why you are there and has agreed to see you, which shows a willingness to consider your product and company. The more you have thought about and dealt with possible objections before the presentation, the more likely the customer will be to accept your proposal. At a minimum, you have shown you are committed to his or her satisfaction and positioned yourself for success in the future.

Anticipation Enhances Negotiations

Basic customer objections run across all buyers and do not change over time. With training and experience, salespeople can learn to anticipate objections while preparing for the presentation.⁷ We spoke in detail in chapter 7 about getting ready for a great sales presentation. A critical part of that preparation is to preempt customer objections. When you address a concern in your presentation, will the customer raise it anyway? Possibly, but by anticipating the customer’s apprehension you will have a response already developed and can reinforce it if he or she brings the objection up again. Interestingly, research suggests that high performing salespeople are able to learn and retain more information than low performance salespeople. At the same time they create more "if-then" scenarios preparing for the sales presentation. In essence they do a better job of anticipating objections by customers.⁸

One benefit of anticipating customer objections is that you can solve a problem before the customer has a chance to mention it. Taking the time to work out solutions to customer objections in advance lets the salesperson offer choices so the customer doesn’t feel compelled to say no. For example, if you foresee price as a customer concern, develop different combinations of benefit bundles (service levels, product quality, and financial terms) to demonstrate your willingness to work with the customer.

Say What You Mean and Mean What You Say

Plain-speaking, honest answers go a long way toward building trust and reducing customer anxiety. When customers come to realize that you have their best interests in mind and deliver on statements during the presentation, their overall concern about the company and about you is diminished. When you say you are going to follow up on a question and get back to the customer later that day, you must do it. Admitting you don’t know the answer to a question is always a better strategy than trying to bluff. Customers don’t expect you to have all the answers, but they do expect you to find out.

When customers trust you and your company, they are less likely to be concerned about price, ability to deliver products on time, product quality, and customer service. Of course, this means a great deal of communication inside your own company. When a salesperson says, “Yes, we can deliver the products by next Friday,” he or she must have the knowledge to support that delivery date. Because you are the point of contact with the customer, your ability to represent the company honestly and accurately is essential in reducing customer objections about you and your company.

Negativity Destroys Negotiations

There is often a lot at stake in negotiations with the customer (purchase order, commissions, and reputation, just to name a few), and negotiations can become very tough. Both parties seek to do the best job for their respective companies, and conflict on a variety of issues (price, delivery, credit terms, product configuration) is a natural part of the process. There’s always a risk of becoming emotionally involved in the proceedings. Frustration, even anger, at the customer, the circumstances, or the way the process is going is always possible and difficult to control. It is natural to defend yourself when you perceive an attack. But controlling your anger is critical to successful negotiations. Allowing negativity to enter the negotiations will lead to a similar reaction in the customer. Once this happens it is very difficult, sometimes impossible, to get the negotiations back on track.

When the situation is getting frustrating and you feel anger, step back from the process. Ask questions to keep the customer involved and allow him or her to voice concerns. Staying connected to the customer while managing your frustration is essential. It can help to remember the customer is likely frustrated as well. Maintaining control of one’s anger demonstrates a willingness to work with the customer that will often be appreciated.

Listen and Validate Customer Concerns

Customers simply want the salesperson to listen and respond to their concerns. As we have discussed, the selling process asks customers to take a risk. New customers are risking a great deal, but even if they have been customers for a long time the selling process, by definition, is about change. Even though a salesperson has addressed their objections, customers may still feel the need to voice specific worries during the negotiations.

The concern may seem trivial to the salesperson, but it is important to the customer. Listening and validating the customer’s concern acknowledges that it has value.⁹ It is important to listen actively to customer concerns (as discussed in chapter 7). Focus on the customer, make sure you understand what he or she is saying, and then respond to the concern.

Always Value the Value Proposition

The most effective tool for negotiating with customers is a well-developed value proposition. Carefully explaining the benefits of your company, products, services, and yourself goes a long way toward alleviating customer objections during the presentation. When you link benefits to overall value, customers will tend to worry less about price (a major customer concern), as well as other issues, and focus more on how you have addressed their needs.

Value is more than price. While customers often direct their discussion toward price, it is the salesperson’s responsibility to seek out and identify the real value of the company’s product to the customer. The value added by your company could take many forms, including better customer service, enhanced product quality, or improved buyer–seller communication. After identifying the value added by your company and communicating that to the customer in the sales presentation, you may need to go back and reinforce it during negotiations.

Question

In the question strategy you take the customer’s concern, turn it into a question, and refocus on one or more strengths of your value proposition. The goal is to get the customer thinking about your presentation in a new way and contrast his or her concern against an advantage. Notice in our example that the customer is concerned about the price of the product relative to the competition. The salesperson asks the customer to consider that, while the product has a slightly higher price, it is of better quality.

Think about possible customer objections before the presentation and formulate questions to address those concerns. Questions are a relatively nonthreatening method of handling customer objections, but you must listen to the customer’s comments to develop a question that addresses the concern. Here’s an example of this technique.

Buyer: Your product is 10 percent more than your competitor’s. That’s too much.

Seller: Yes, it is slightly more expensive, but do you agree that the higher quality of our product means fewer returns and lower service costs for your company in the long run?

Direct Denial

Perhaps the most confrontational strategy for dealing with customer objections is the direct denial method, which involves an immediate and unequivocal rejection of the customer’s statement. Customers may find this kind of direct disagreement threatening and have a very negative reaction.

You are probably wondering if you should ever use this strategy to address a customer concern. When a customer states a clearly false and damaging statement about you, your company, or your product, it is important to respond to the statement immediately. Allowing such ideas to continue is usually more damaging than provoking the customer. If it is a simple case of misinformation, stating the facts directly will probably clear things up for the customer.

Critical to the success of this strategy is the manner in which you address the customer misstatement. If you are offensive and insulting, the customer will likely react negatively to the statements. The focus should be to create a win-win negotiation, but being condescending or demeaning eliminates that outcome.

Buyer: I was told recently that you had to recall all of your production for the last two months because of a faulty relay in your switch mechanism.

Seller: I’m not sure where you could have heard that. We have not had a recall on any of our products for over 10 years. If you like, I can provide the data for you. Your source was mistaken.

Indirect Denial

Indirect denial takes a less threatening approach. The salesperson begins by agreeing with the customer, validating the objection before explaining why it is untrue or misdirected. For this strategy, the customer’s concern should have at least some validity. Perhaps you are priced slightly higher than the competition, or your product features do not match up exactly with the current supplier’s. Address the concern by first acknowledging that part of what the customer is saying is true.

If the customer has raised a totally valid point, reconsider this strategy. You don’t want to deny a legitimate customer point that makes the presentation weaker. If it is not possible to deny the customer concern with the information at your disposal, do not use this strategy.

Buyer: Demand for your products is strong. I’m not convinced you will be able to meet my order on time.

Seller: You are correct. My company has enjoyed tremendous success and we are thankful our customers have adopted our product. However, we pride ourselves on not missing order deadlines, and our customers will verify that. I will be working with my manufacturing and logistics departments to ensure on-time delivery of your order. One last note: you can check the status of your order any time by logging on to our website. If you are not satisfied, call me.

Compensating for Deficiencies

No product is perfect. Every product is a combination of advantages and disadvantages. Companies design, develop, and build products based on a bundle of features (product characteristics) they believe will be accepted in the marketplace. Customers must balance what they want with what they are willing to pay (the value proposition). They realize that the perfect product doesn’t exist and they must decide which features, advantages, and benefits are most important to them.

Customers frequently object to some element of the product’s FAB mix. The salesperson’s task is to move the customer from focusing on a feature his or her product performs poorly to one in which it excels—to compensate for deficiencies in the product. The new feature must be important to the customer. Talking about a feature the customer is not interested in will only make the situation worse.

First, acknowledge the validity of the customer’s concern about the feature in question. Second, move the customer to the new product feature by pointing out the trade-off between the two. If the customer insists the product must have this one feature, it is time to consider offering products that are closer to meeting that demand, even if you do not enjoy an advantage with these products. Ultimately, the customer is right and you must adjust your product offerings to meet his or her demands. Note that the example shifts the focus from response rate (one product feature) to price and quality.

Buyer: The response time on your product is too slow. Your competitor’s response time is nine-tenths of a second, which is two-tenths of a second faster.

Seller: I agree with you. My product is two-tenths of a second slower. However, please note that it also costs 25 percent less per unit than the product you are currently using. You indicated price was an issue in your decision. I would also add that my product has 10 percent fewer returns than your current supplier. I have the numbers right here if you care to take a look.

Feel—Felt—Found

There are times when customer objections are more connected to their attitudes, opinions, or feelings than to facts. “In my opinion” and “I believe” are indicators that the customer is moving from a fact-based to a feeling-based concern. In these situations, the feel—felt—found technique can be helpful.

First, acknowledge the customer’s feeling (“I can see how you feel”). Second, extend the same feelings to a larger audience (“Other customers have felt the same way”). Third, counter with a legitimate argument (“However, I have found that our products… ”). The sequence is important and should be followed exactly.

At first glance, this may seem like a good strategy for dealing with customer objections, as you are relating very specifically to the customer. However, it is an old technique and one most professional buyers know. Using it on the wrong person can create the impression you are being disingenuous and the presentation is prepackaged.

Buyer: In my opinion, your products are overpriced and not worth the extra cost.

Seller: Our products are slightly more than the competition’s and I can certainly see why you feel that way. Other customers have felt that way at first. However, when they take the time to examine my company’s higher product quality and improved customer service (which result in lower service costs) they have found the overall value of the product to be worth the investment. Let me show you those numbers again.

Third-Party Endorsements

This strategy is based on the use of outside parties to bolster your arguments in the presentation. It can be used in combination with other strategies, such as feel—felt—found and indirect denial. The use of third parties to endorse you, your company, or your product does add credibility. However, it is essential to get their permission before using them for an endorsement. Many customers do not wish to have their names used in this way. We spoke earlier of potential conflicts of interest if the customer you are calling on is a competitor of the endorsing party. In addition, you always run the risk the customer will have a negative reaction to the third party. Use this technique only when you know the relationship between your customer and the third party.

Buyer: Your customer service has been questionable, and it is important I have tech support 24/7.

Seller: I agree with you that our customer service was not what it should be several years ago. However, we made the investment to improve customer service, and it is now among the best in the industry. Gracie Electronics felt as you did but was willing to try us and is now one of our most satisfied customers.

Bounce-Back

An experienced salesperson knows when to turn a customer concern into a reason for action. The bounce-back is effective in many different situations (appointment setting, negotiating, and closing). It is more aggressive than some of the other strategies, so be careful not to seem pushy.

This technique can be particularly effective when you hear objections about needing more time or a lower price. Indeed, when you understand the value proposition of your product you will note that often it is designed to save the customer time and/or money. So when the customer raises a concern about time or cost, you have an opening to reinforce the cost savings and time efficiencies of your product.

Buyer: I’ve listened to your presentation but need more time to consider your proposal.

Seller: I can appreciate that this is a big decision for your company. However, delaying this commitment only costs your company money. As we agreed earlier, my products will save nearly 40 percent in manufacturing costs over your existing supplier. Delaying this decision simply means higher costs for your company.

Defer

Customers seldom let a salesperson complete an entire presentation without interrupting to ask a question. If the concern they raise is one you will address later in the presentation, you may want to defer it until you have had the chance to explain other material. Most of the time the customer will understand and let you continue with the presentation. Occasionally, the customer will demand an immediate answer. If pressed, you should respond immediately. However, suggest that the customer listen to the entire presentation in order to fully appreciate all the features, advantages, and benefits of the product.

The defer strategy is most common when the customer raises a concern about price early in the presentation before the salesperson has a chance to fully define the value proposition. Simply stating the price of the product without fully explaining the benefits bundle may lead the customer to the wrong conclusion—that the price is too high. You need to evaluate the customer and determine if he or she needs the information at that point to assess the product’s value. (Some people process information differently than others.)

Buyer: (before the full value of the product has been explained): What is the cost of your product?

Seller: I can appreciate your interest in knowing the price of the product, but I would ask you to hold off just a minute until I know a little more about your product requirements and determine which of our products best suits your needs. Then I will be happy to show you what kind of investment you need to make.

Trial Offer

One of the best strategies to calm customer objections is the trial offer, which allows the customer to use the product without a commitment to purchase. It is especially effective with new products, because the customer can try the product, become familiar with it, and see the product benefits without risk.¹⁰

Here are some guidelines to keep in mind. First, the trial offer does not take the place of a good sales presentation. Second, clearly define the terms of the offer so there will be no confusion. A customer who does not know the offer is for three days may keep using it even after your company has sent a bill. These misunderstandings can do much more harm than good. Third, make sure the customer is fully checked out on the product. Don’t leave a client with a product he or she does not know how to use correctly.

Buyer: I’m not willing to make a commitment to your copier today. It seems complicated and hard to use.

Seller: I can appreciate your concerns. How about I have our service department install one for you and let you try it for one week. I will come by and demonstrate it for you. You are welcome to use it for one week without any obligation. If at the end of the week you do not believe this copier solves all your copying needs, call me and I will come pick it up.