One of the most useful skills you can learn is how to negotiate effectively. Here are a couple of quick tips (since it's late) on how to negotiate.
1) Do what my 5 year old daughter does. Never give up! "I want a Wii." Sorry, Melissa--it's too much. "I really want a Wii." Maybe for your birthday. "Daddy--if you love me, you'll get me a Wii." Guess what? I just played a game of "Super Mario Galaxy" on my daughter's new Wii. (Great game, by the way.) In the car sales world--"Your payment is $400." I want to be at $300. "I'm sorry, but your payment is $400." How about $350? "I wish but it's $400." Ok.
2) Change the offer (very powerful.)
You: "Mr Customer, your payment is going to be $400."
Customer: "I want to be at $350."
You: "I'll check with my manager. (leave and come back) You know what? They made a mistake--they used the wrong rebate and your payment is really going to be $427"
Customer: "But you told me $400! If it's not $400, I'm walking." You get the picture--very powerful stuff.
3) Use the "up-to" hand motion.
Customer: "I'll pay $350 per month."
You (motioning your hand in an raising manner): "Up to...?"
Customer: "Up to $375"
You (raising hand higher): "No more than...?"
Customer: "No more than $390"
You (final raise): "But if you found the perfect car and it was $400, you wouldn't let $0.30 per day keep you from your perfect car, would you?"
4) Be prepared to walk away--and mean it!
You: "Mr. Customer, this car is gonna run you $23,900"
Customer: "I'll only pay $20,000"
You: "Unfortunately, this is the hottest car out there and that's what they are selling for. But I would understand if you don't want to pay that so have a nice day."
Customer: "Uh--what about $22,000?"
5) "Here's what I can do for you..." I work with some people who want us to get an offer out of the customer before we work figures. You know what? I disagree... Lets say you walked into Lowe's and wanted to buy a dishwasher and you asked the sales dude how much it is and he said, "Make me an offer what you would pay today and I'll take it to my manager." You would...
a) Either make a low ball offer
b) Be afraid to make an offer at the chance of offering too much
c) Get pissed at the high pressure tactic and buy somewhere else
d) Say, "I'm just looking."
So--here's what I would do.
Customer: "How much is this car?"
You: "It's $23,900 but here's what I can do for you today. I have a contest I'm trying to win so I'll sell it to you right now for $23,250 and if anyone asks, you're my cousin and using my discount, OK?"
Last but not least (at least in this article...)
6) Hit them high and negotiate from there. It's a negotiation game so hit them at full sticker (at least) and get them to make an offer after you "peal them from the ceiling" unless of course the stars align and they hook up! (it happens about 10% of the time by the way...)
7) Indifference: If you act like it is no big deal to sell the customer a car, they will want it more. I remember a billion times where it was time for me to go home and a customer walks in. "Are you still open?" I try everything in my power to get them not to buy so I can go home broke and they buy. Hmmm...
8) "I'm not sure if this car is available. I think someone already bought it...let me check." Remember the Wii I talked about? I already have a powerhouse computer and an XBox 360 so I really had no intention of ever buying a Wii but when they told me I couldn't have one--I wanted it! I did the same thing when I bought my house. The real estate lady told me they had 2 other people about to make offers so I paid almost full sticker and bought my $130,000 house (that is probably only worth $20,000 right now--freaking Michigan economy!)
Hey--"Family Guy" is on so goon night and good luck selling!
Marv
Showing posts with label how to close customers. Show all posts
Showing posts with label how to close customers. Show all posts
Monday, March 31, 2008
Tuesday, February 26, 2008
"I Want to Think About it"
Ah--the dreaded statement! It has made people crumble in fear--fear that they would either hear it or fear that they just heard it.
I was once a computer salesperson at Sears. It got to the point where everyone said "I want to think about it." I even told a fellow salesperson that if I heard it one more time today, I was going to quit. Of course, that was before I learned to sell. Now, I love when people say it because it gives me an opportunity to close a sale.
First off all, why do people say that they want to think about it?
I'll tell you why I say it when I'm out shopping.
1) I say it when I don't think I can afford a product or when the price is not what I want to spend.
2) I say it when I don't want to hurt a salesperson's feelings--especially if he spent a lot of time with me.
3) I say it when I have questions and am too afraid to admit that I don't know something.
4) I say it when I don't like a product.
5) I say it when I don't like the salesperson and don't want him to have my business.
You know what? Your customers pretty much say it for the same reasons. As a matter of fact, 99% of the time, you can narrow "I want to think about it" into one of three reasons (or objections if you'd rather...)
OK--here's how not to handle "I want to think about it"
Customer: I want to think about it?
You: What's there to think about?
You: How much time do you need?
You: No you don't.
You: OK--here's my business card. Call me after you think about it.
Here's the correct way to handle it.
Customer: I want to think about it.
You: No problem. (Customer relaxes)
You: Let me ask you this. I've been selling cars for a long time and I've discovered that when people say they want to think about it, it's usually one of three things they want to think about. It's either the car, something I said or did or the price. Which one of those do you need to think about?
Customer: The price. It's too high. (They will say price probably 80-90% of the time)
You: (Isolate the price objection) Besides the price, is there anything else you want to think about?
Customer: No--just the price.
You: (Rephrase the objection to make it easier to handle) Is it the actual cost of the car or the payment?
Customer: The payment.
You: Well, we're at $320 and that is actually a great payment on the car. What were you expecting?
Customer: $250.
You: Well, if we could figure out a way to get the car to fit within your budget is there any other reason why you won't take it home right now?
Customer: No.
It really is that easy. Now you may be saying, "Marv--we're still $70 apart--it's not that easy!" Yes it is. How can you bump a customer $70?
Here are some tips. When you ask them what kind of payment they have set aside in their budget, stretch out your hand (palm up) and raise it up and say, "Up to..."
Customer: $250
You: Up to...?
Customer: Up to $275
You: (Raising palm again...) No more than...?
Customer: No more than $280.
You: Let me ask you this--what if we found you the perfect car--it had everything you wanted and it was just a few dollars higher than $280--you wouldn't let a few pennies a day keep you from your perfect car--would you?
Later, when you hit them at $320--you can remind them that they said a few pennies a day wouldn't keep them from their new car. $45 per month is only a little over a dollar a day--a candy bar, a pop, a bag of chips, 4 cigarettes, etc. You get the picture. Raise them!
OK--another technique.
You: Where do you want to be?
Customer: $250
You: (Suck a deep breath through your teeth.) Ooooh. I'll try but I gonna need a little help from you.
Yet another technique: The Gas Saving Close (See my earlier blog about that closing technique)
Yet another technique--work them for money down! What a concept! Try this: "Were you going to put the standard 10% down that the banks like to see?"
Customer: How much is that?
You: About $3500. (Watch their face drop but don't pause) But you can always put more down if you want to lower your payment.
Later when they try to get a lower payment, remind them that it would take money OVER the 10% down to do that--just like you told them earlier. If they balk at money down (like most people here in Michigan do...) use it as a closing opportunity. "Normally, the banks like to see the 10% down--especially with today's credit problems--but if I can work it out with no money down, will you take it right now?" Sometimes the initial money down is more important than payments down the road...most people (myself included) think very short term.
By now, you know that I like to ramble so I'll stop the rambling. Listen to salespeople around and hear how many hear "I want to think about it" and let their customers walk. How many sales are they missing? How many have you missed (hopefully none!) I missed a ton before I learned how to overcome that excuse but I never just let it fly by in the wind anymore.
I was once a computer salesperson at Sears. It got to the point where everyone said "I want to think about it." I even told a fellow salesperson that if I heard it one more time today, I was going to quit. Of course, that was before I learned to sell. Now, I love when people say it because it gives me an opportunity to close a sale.
First off all, why do people say that they want to think about it?
I'll tell you why I say it when I'm out shopping.
1) I say it when I don't think I can afford a product or when the price is not what I want to spend.
2) I say it when I don't want to hurt a salesperson's feelings--especially if he spent a lot of time with me.
3) I say it when I have questions and am too afraid to admit that I don't know something.
4) I say it when I don't like a product.
5) I say it when I don't like the salesperson and don't want him to have my business.
You know what? Your customers pretty much say it for the same reasons. As a matter of fact, 99% of the time, you can narrow "I want to think about it" into one of three reasons (or objections if you'd rather...)
- The customer doesn't like the product (or has questions about it)
- The customer doesn't like you (or you confused them)
- The customer doesn't like the price
OK--here's how not to handle "I want to think about it"
Customer: I want to think about it?
You: What's there to think about?
You: How much time do you need?
You: No you don't.
You: OK--here's my business card. Call me after you think about it.
Here's the correct way to handle it.
Customer: I want to think about it.
You: No problem. (Customer relaxes)
You: Let me ask you this. I've been selling cars for a long time and I've discovered that when people say they want to think about it, it's usually one of three things they want to think about. It's either the car, something I said or did or the price. Which one of those do you need to think about?
Customer: The price. It's too high. (They will say price probably 80-90% of the time)
You: (Isolate the price objection) Besides the price, is there anything else you want to think about?
Customer: No--just the price.
You: (Rephrase the objection to make it easier to handle) Is it the actual cost of the car or the payment?
Customer: The payment.
You: Well, we're at $320 and that is actually a great payment on the car. What were you expecting?
Customer: $250.
You: Well, if we could figure out a way to get the car to fit within your budget is there any other reason why you won't take it home right now?
Customer: No.
It really is that easy. Now you may be saying, "Marv--we're still $70 apart--it's not that easy!" Yes it is. How can you bump a customer $70?
Here are some tips. When you ask them what kind of payment they have set aside in their budget, stretch out your hand (palm up) and raise it up and say, "Up to..."
Customer: $250
You: Up to...?
Customer: Up to $275
You: (Raising palm again...) No more than...?
Customer: No more than $280.
You: Let me ask you this--what if we found you the perfect car--it had everything you wanted and it was just a few dollars higher than $280--you wouldn't let a few pennies a day keep you from your perfect car--would you?
Later, when you hit them at $320--you can remind them that they said a few pennies a day wouldn't keep them from their new car. $45 per month is only a little over a dollar a day--a candy bar, a pop, a bag of chips, 4 cigarettes, etc. You get the picture. Raise them!
OK--another technique.
You: Where do you want to be?
Customer: $250
You: (Suck a deep breath through your teeth.) Ooooh. I'll try but I gonna need a little help from you.
Yet another technique: The Gas Saving Close (See my earlier blog about that closing technique)
Yet another technique--work them for money down! What a concept! Try this: "Were you going to put the standard 10% down that the banks like to see?"
Customer: How much is that?
You: About $3500. (Watch their face drop but don't pause) But you can always put more down if you want to lower your payment.
Later when they try to get a lower payment, remind them that it would take money OVER the 10% down to do that--just like you told them earlier. If they balk at money down (like most people here in Michigan do...) use it as a closing opportunity. "Normally, the banks like to see the 10% down--especially with today's credit problems--but if I can work it out with no money down, will you take it right now?" Sometimes the initial money down is more important than payments down the road...most people (myself included) think very short term.
By now, you know that I like to ramble so I'll stop the rambling. Listen to salespeople around and hear how many hear "I want to think about it" and let their customers walk. How many sales are they missing? How many have you missed (hopefully none!) I missed a ton before I learned how to overcome that excuse but I never just let it fly by in the wind anymore.
Monday, February 4, 2008
The "Outrageous Payment" Close
I saw my manager use this one today.
I was trying to sell a customer a car and the payment was around $530 per month. They told me that they wanted to be between $475 and $480 per month but they would not make a commitment today. We had the exact vehicle they wanted and they said that they wanted to "sleep on it." (usually an excuse)
I said, "Look--I've been selling cars for 12 years and usually when someone says they want to sleep on it, something is bothering them. It's usually the car, the price or something I said or did. Which one is it?"
She said, "He just started a business, I just lost my job and our house payment is $1800 per month--we just have to make sure we can afford it."
I wanted to say, "Then what are you doing here?" but instead, I tried again at a commitment to do business right now. They said they loved the vehicle and that they were pretty sure that the $475-$480 would work but that they really had to go home and do the math. I did the right thing and brought my manager over for a T-O.
He asked them, "If the payment was $450, would you take it right now?" I almost swallowed my tongue!
They answered, "No--we really have to talk about it."
He laughed and said, "Good--because I can't get there" and they all laughed. He told them to stop by in the morning and that he would try his best to make it work for them. They left on a good note and I think I have a 50/50 chance of selling them.
After they left, I asked him about the "$450 thing." He said, "I was just testing the water. I wanted to see if they would take the vehicle at any price."
"What if they would have said yes?" I asked.
"Then I would have said, So, there is a price that you would do business at today. Let's go ahead and work some numbers and get you closer to where you need to be."
Looking back, what he did was very smart. Number 1, he put an ever better price in their heads than where they want to be and I think that will increase my chances of getting them back up to the dealership and Number 2, he discovered that in their case, price wasn't the issue.
There is certain point in people's thinking where they will go from not being there to buy to crossing the line mentally to being there to buy. That is why you get a signed offer when someone makes them--the process of signing the piece of paper makes them feel, in their mind, that they are buying a vehicle. If my customers would have said yes to his $450 thing, it didn't mean that we would have to get there to sell them a car--it would just mean that they mentally got off of their having to sleep on it to actually making a decision to buy a car right now.
By the way--when closing a customer, don't say will you do business today? Today is from now until midnight--plenty of time to shop. Say, will you do business right now? You always want to "spot deliver" customers so they don't have time to second guess themselves.
By the way--I just bought my dream vehicle today. A 2003 Chevrolet Tahoe with 77K miles--just broken in for a Tahoe. My wife has been wearing me out all evening... "Did we do the right thing? Did we get a good deal (we did by the way...) Don't you think we should have gotten something cheaper? Your mom said we shouldn't have bought it." I am firmly convinced that if we wouldn't have done the paperwork this evening, she would be doing everything in her power to talk me out of getting the perfect vehicle at the perfect price. Exactly what happens to your customers if you give them time to think about it. They will always find a better deal, people will always tell them that they got a bad deal and they will always second guess themselves (maybe we should wait until we get our income tax...) Don't let it happen! Sell them on the spot.
NOTE as of 2/6/08: The people came back and bought from me today.
I was trying to sell a customer a car and the payment was around $530 per month. They told me that they wanted to be between $475 and $480 per month but they would not make a commitment today. We had the exact vehicle they wanted and they said that they wanted to "sleep on it." (usually an excuse)
I said, "Look--I've been selling cars for 12 years and usually when someone says they want to sleep on it, something is bothering them. It's usually the car, the price or something I said or did. Which one is it?"
She said, "He just started a business, I just lost my job and our house payment is $1800 per month--we just have to make sure we can afford it."
I wanted to say, "Then what are you doing here?" but instead, I tried again at a commitment to do business right now. They said they loved the vehicle and that they were pretty sure that the $475-$480 would work but that they really had to go home and do the math. I did the right thing and brought my manager over for a T-O.
He asked them, "If the payment was $450, would you take it right now?" I almost swallowed my tongue!
They answered, "No--we really have to talk about it."
He laughed and said, "Good--because I can't get there" and they all laughed. He told them to stop by in the morning and that he would try his best to make it work for them. They left on a good note and I think I have a 50/50 chance of selling them.
After they left, I asked him about the "$450 thing." He said, "I was just testing the water. I wanted to see if they would take the vehicle at any price."
"What if they would have said yes?" I asked.
"Then I would have said, So, there is a price that you would do business at today. Let's go ahead and work some numbers and get you closer to where you need to be."
Looking back, what he did was very smart. Number 1, he put an ever better price in their heads than where they want to be and I think that will increase my chances of getting them back up to the dealership and Number 2, he discovered that in their case, price wasn't the issue.
There is certain point in people's thinking where they will go from not being there to buy to crossing the line mentally to being there to buy. That is why you get a signed offer when someone makes them--the process of signing the piece of paper makes them feel, in their mind, that they are buying a vehicle. If my customers would have said yes to his $450 thing, it didn't mean that we would have to get there to sell them a car--it would just mean that they mentally got off of their having to sleep on it to actually making a decision to buy a car right now.
By the way--when closing a customer, don't say will you do business today? Today is from now until midnight--plenty of time to shop. Say, will you do business right now? You always want to "spot deliver" customers so they don't have time to second guess themselves.
By the way--I just bought my dream vehicle today. A 2003 Chevrolet Tahoe with 77K miles--just broken in for a Tahoe. My wife has been wearing me out all evening... "Did we do the right thing? Did we get a good deal (we did by the way...) Don't you think we should have gotten something cheaper? Your mom said we shouldn't have bought it." I am firmly convinced that if we wouldn't have done the paperwork this evening, she would be doing everything in her power to talk me out of getting the perfect vehicle at the perfect price. Exactly what happens to your customers if you give them time to think about it. They will always find a better deal, people will always tell them that they got a bad deal and they will always second guess themselves (maybe we should wait until we get our income tax...) Don't let it happen! Sell them on the spot.
NOTE as of 2/6/08: The people came back and bought from me today.
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