“The tip I’m going to share with you is called ‘Something Special’ and what it does is it reveals the client’s timing without telegraphing any kind of a concession. ” – James Muir in today’s Tip 191
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Scott Ingram: You’re listening to the Daily Sales Tips podcast and I’m your host, Scott Ingram. Today after 191 episodes we’re going to break one of my self imposed rules, and that is that we keep all of these tips to 5-10 minutes or less. What I didn’t expect when I started the show is that the average tip would actually be less than 5 minutes, but I think you’ll find that today’s tip deserves the exception. James Muir is one of my personal heroes because of how much he does for the sales community. He’s also the author of The Perfect Close: The Secret to Closing Sales. In fact, today’s tip is one that he hasn’t shared publicly before. So enough from me, let’s give a listen to James.
James Muir: James Muir: How do you figure out if a deal can close this quarter without telegraphing and concession? This is James Muir and I’m going to tell you exactly how to do that right now. If you’re involved in sales in any way, then I’m sure you’re familiar with the pressures associated with reaching end of month and end of quarter quotas and it’s pretty sad that these pressures have given rise to so many dysfunctional selling practices. And a very common tactic is to offer a concession of some kind in order to close the sale before the end of the month or the end of the quarter. So let me ask you a question. Have you ever been faced with quarterly or even monthly pressures to close business? Yeah, of course, you have. Right? Me Too. It’s part of the business. Now let me ask you another question. Have you ever tried to discount a deal in order to get a customer to close sooner? Yeah, of course. I’m guilty of that too. Now let’s think about this just for a minute. When we do that, what do we actually doing? We’re trading margin for timing, aren’t we? That’s what we’re doing. We’re trading margin for timing. Now, I’m not a fan of discounting to try to accelerate timing. I’m not, in fact, I recommend against that, but I’ve worked for publicly traded companies for almost two decades. So I do understand the dynamics involved, and in some cases, revenue recognizes this quarter may actually be more valuable to the company then that exact same revenue recognizes the following quarter. So as you might imagine, I have a long history of executive management encouraging accelerated sales every single quarter, often by whatever means possible. So before I share this tip with you, let me ask you another question. How many of you have tried to discount a deal in order to get the customer to close sooner and it didn’t work anyway? Do you guys know what I’m talking about? It’s like getting kicked when you’re down, right? And how many of your clients actually forgot that end of quarter discount after the quarter? Did any of them forget? Well, it’s never happened for me anyway. All right, so the tip I’m going to share with you is called ‘Something Special’ and what it does is it reveals the client’s timing without telegraphing any kind of a concession. So I’m pretty sure you’re gonna like it. Now, let me tell you how it came about. When I was brand new to sales, I used to have this big whiteboard in my office and I kept all my opportunities on that whiteboard and this one quarter I had exactly 10 opportunities on that whiteboard of new business that was in play and one of these opportunities was very close to closing already and the other nine were all somewhere in the middle of their closing process. So two weeks before the end of the quarter, we get word from upper management. We’re having a particularly challenging quarter and we need to use all legal means possible to bring in more business. So I was encouraged to offer discounts to all 10 accounts as an inducement to get them to close before the month-end, which I did. And every single account knew that discount was conditional upon receiving agreements before the end of the quarter and that they would not receive that discount if it came in later. Now let me ask you a question. How do you think that all worked out? Well, I’m going to tell you only 1 of those 10 deals sign the very deal that was already very close to signing, to begin with. So all the other remaining accounts chose to just continue their evaluation process rather than take advantage of the discounts. Now, of course, I kept working these accounts into the next quarter and ultimately we actually closed seven more for total out of eight out of 10, which is really good. But, on every single one of those opportunities, there was this awkward conversation about whether or not they were going to get that same discount that they saw the previous quarter. Do you know what they’d say? They’d say, “Well Gosh James, if it was worth it to you before, why isn’t it worth the TNL?” And when I would resist, you could literally see a tangible erosion of goodwill on their facial expressions. All right, so fortunately near the end of the very next quarter, I found myself in the exact same repeat fire drill of the previous quarter where management was encouraging discounts in order to close business. And they used to call it weapons-free. You are now a weapons-free, right? You’re now a discount all you want. So thankfully I used that opportunity to produce the discounts that I had before and everything ended well, but, and this is the key point here with lower margins. So it was this crazy downward spiral, right? Offering a discount and then we don’t actually get the timing that we want and then having to give that discount again the next quarter and then we get lower margins and I get lower commissions and then we inadvertently train the customer to seek and a quarter discounts. It was this crazy downward spiral dynamic that got me thinking, man, there must be a better way to see if a deal can really close by the end of the quarter without telegraphing the concession and without having to give that concession later, even if they couldn’t close by and a quarter. And that’s exactly how something special was born. Something Special is really just a standard perfect close question that reveals the client’s timing without telegraphing any kind of concession. And many professionals have told me that this one close is among the most valuable things that they’ve ever learned in sales, so I’ll let you guys be the judge, but here it is Verbatim. Does it make sense for me to see if we can do something special for you If we can get everything wrapped up by the end of the quarter? Let me say that again. Does it make sense for me to see if we can do something special for you If we can get everything wrapped up by the end of the quarter? now naturally you’re going to adapt the timeframe to suit your situation. Otherwise, I’m going to recommend that you use it verbatim. Now it’s important that we come to that conversation without any particular concession in mind. Determining what the client deems as special is going to require another step and a second conversation. Your attitude should be something like this. Well, I don’t know. All my options are without talking to some folks, so a, but if the timing is right, then I’ll go see what we mean, what I can do for us. Okay. Now, the beauty of this approach is that if the timing isn’t right for the client, you’re never going to have to discuss what that something special might’ve been and your margins are going to be preserved going into the next period. But if the buyer says that it is possible to wrap things up, then awesome. Right now we know that it can’t possibly close this quarter, right? And then what you’re going to do is you’ve got a couple of different options and the first is that you could ask them what they would find most valuable. Great, not guaranteeing anything until you talk to people inside your own organization. And then the second is that you’re going to tell them that you’re, you’ll go see what you can do and then you’ll report back. Now these aren’t mutually exclusive, right? I use both of these. However, sometimes you might want not want to do option number one. And that’s because if the force is telling you that they’re going to ask for a concession that you know you’re not going to be able to deliver on, then you don’t want to offer them that because asking is only going to set an expectation that you can’t meet. Okay. Now, and I know you already know this, but I’m just going to say it, remember that you have a lot more concession options than just price. Okay? I have often found that my clients preference for a concession is, is very much not what I was expecting it. So don’t assume based on the dynamics within the given organization, clients often value concessions on services and other things. Actually much more than a discount on the basic price. Okay? So what you’re really looking for here is something that’s of high worth to them, but of low cost to you. Now, let me tell you how NOT to do this. Okay? Many years ago, one of my brand new reps, he comes to me with this opportunity, he’s hoping to close by and a quarter. Right? And the client’s got the proposal. They’ve been through all the steps of our sales process. So to seal the deal, my rep wants to offer a discount to buy before the end of the quarter, right? So I tell him to use the something special application of the perfect close. In fact, I had him write it down. Okay. So I tell him, ask him, does it make sense to see if I can do something special for you? If we can get everything wrapped up by the end of the quarter. And what he says is, well, well James, what if he says yes, what’s the something special? And I say, well, we’ve got a lot of options depending on what they value most. Let’s just see if the timing works. And he comes back, well, what kinds of things are possible? I said, well, we’ve got a lot of things right? We can play with the terms, we can play with the deposit, we could change the licensing scope. We could play with the maintenance, we can get them some music group passes, you know, there’s a lot of directions we could take it. And he says, well, can we get him a discount? And I’m like, sure. Discounting is one of the options. Okay, but let’s just start with the timing. And then there’s a second step we can determine which concessions going to be the most effective. So here runs out of my office all excited. Okay. Now a little while later, I actually see him in the hall and he’s looking all dejected and disappointed. And so I ask him how, you know, “How is going?” He goes, “Oh, your question didn’t work at all.” And I said, “Really? What happened?” He says, “I asked him your question. And then he got all angry at me and then asked me to create a new proposal with a bigger discount on it.” And I’m like, wow, that is not usually the reaction that we get. Why did he get so mad? And he says, he said he’d let me know when he was ready to buy and he was mad that we hadn’t already offered him our price. And I thought from an, I said, so he immediately assumed that something special meant a discount, you know, that’s kind of strange. He says,” Yep” and now I have to go create a new proposal. And then he goes and marches off. And so it just so happened that in our company we were testing this phone system that will let us audit calls for coaching purposes. So I thought, man, I’m going to go listen to that call. Okay, and here’s what I found. Instead of asking, does it make sense to see if we can do something special for you, If we can get everything wrapped up by the end of the quarter, my rep instead says this, he says, if you’ll sign before the end of the quarter, I can get you a bigger discount. Now that is completely different than what I instructed him to say. In effect, what he was saying is, will you sign before the end of the quarter if I give you a discount? And that makes the question about the action rather than the timing. And that’s a big mistake right now. As I continued listening to this conversation, I actually heard the guy say, he goes,” I haven’t even run the proposal that I have now.” Which was supposed to be your best and final proposal past our board yet. And they don’t meet until the 15th and next month. So by changing the question, my rep had put this prospect into a difficult position and that made him mad. Okay? He didn’t say it on the call, but I could tell that he thought it was going to be impossible for him to get his board together in the next two days for some kind of impromptu meeting. And I could also tell that he really wanted the solution, right? It was just really a question of timing. And so when I was coaching my rep afterward, I asked him this question, “Gosh, why did you change the questions so dramatically after I had you write it down?” And he said this, and this is the point of this story. He said, “I thought I was speeding up the process by changing what was a two-step process.” Right? That is asking about the timing and then later coming back and talking about the concession down to a single question, which was, you know, basically will you by if I give you a discount. So what can we learn from this? Well first asking about the timing of possible action is very, very different than asking directly for that action. It gets a different response than it feels emotionally very different. Second, something special is a two question, two-step process, trying to be efficient and shortcutting. That process typically backfires. And third, until you know what’s going on, stick to the recommended phraseology at first, right? There’s plenty of room in the perfect close model to tailor it to your individual styles. But before you do actually understand how it’s going to affect the question and how it’s going to affect the response from the individual you’re asking it to. Okay, so what does something special do, something special accomplishes this Three important things. First, it doesn’t telegraph any kind of concession or the size of that concession. Second, it reveals if the client’s able to do something within your suggested timeframe. And third, it positions you as an advocate for the client because you’re doing all of this on their behalf. So if you’ve ever found yourself on the end of quarter discount rollercoaster, you’re going to appreciate how something special preserves both your revenues and your commissions.
Scott Ingram: The biggest thing that makes James one of my heroes is his generosity and you’ll find that on this tip’s page at DailySales.Tips/191 There you’ll find a link to a resource page that James has available where you can get the first 3 chapters of his book and about a dozen other really other valuable resources for free. He’s also offering a copy of The Perfect Close Workbook. This workbook is now available on Amazon for $99. You used to only be able to get that content by paying $1,995 per person for a private workshop. Now the workbook has everything a sales leader needs to run their own workshop right there. If you want to win that workbook just go to DailySales.Tips/191 and leave a comment. On about August 15th, 2019 I’ll let James choose a winner from those who’ve left a comment. So what are you waiting for? Go leave your comment.
Then be sure to come back tomorrow for another great sales tip from Jack Wilson!