Episode Description:
In this episode we dive into the do’s and don’ts when you can’t close a sale and lose out to the competition. There are valuable lessons to be learned and many sales training programs gloss over what many in sales can imagine is the worst possible outcome. There are opportunities that lie within some deals that are lost – but if you aren’t on top of it you might miss out on them!
Action you can take right now:
- Develop a system to manage your contacts – with DETAILED NOTES of each interaction.
- Look at that last few sales you lost to competition, do you know why you lost the sale?
- List out three or more ideas you can implement to IMPROVE the VALUE of the product or service you are selling.
Episode After-Thoughts
Episode 26 Transcript:
I have read so many sales books I’ve heard so many sales, podcasts, audiobooks, textbooks, so many resources on how to close a sale.
But what happens when you can’t close the sale or you’ve lost the sale to a competitor that more coming up on the marketing and service dot com podcast.
Hey Justin Varuzzo here from marketingandservice.com podcast, the podcast that’s designed to help you build your business by creating incredible customer relationships.
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First, I’d love to hear from you, so please hit me up on the marketing service.com Facebook page.
What marketing challenges are you having in your business? I’d love to know. Shoot me an email at justin@marketingandservice.com or hit me up on Facebook on the marketing and service.com Facebook page. So on today’s episode I want to talk a little bit about the things that happen.
When you don’t close the sale, if you can’t close the deal and if you lose the business to someone else, what do you do so many people cover all these sales techniques on how to close the sale and all these strategies on closing the sale.
Well, but one thing that I don’t often read about is what to do when you don’t close the sale.
Now it could be as just as easy as you just walk away and you disregard it and you never go back.
But if you do that, you’re really making a huge mistake.
The inspiration for this episode is something that I just witnessed happen.
With my own eyes that if I hadn’t seen it and been there in person, I probably wouldn’t have believed the story in this particular instance.
A salesperson was pitching a business on a service.
Now this salesperson had a little bit of insight about a change that was about to occur for this business.
Now it wasn’t anything secret, but it was something that hadn’t quite been publicly announced yet, so I actually give this salesperson a lot of credit for getting ahead because as we’ve heard with other guests on the show, a lot of times.
Simply being the first one.
To make contact with a prospective client is what wins you the business.
We’ve heard this over and over again on this podcast.
Being there early is helpful.
This is true and a lot of things in business.
Look at real estate for example.
A lot of investors will say if it’s already hit the open market.
It’s too late and real estate investors will work hard to try to get a house.
That isn’t even for sale yet, because they know that once it goes for sale, it’s going to be competitive.
In nature, so that kind of applies to a lot of things in business.
So for this salesperson they hit it big.
They had gotten a little inside information and they were the 1st and they were there.
Now they were early for this particular service they were offering.
It was really way too soon, but they planted the seed and it was good that they had got in on this early and that they were the 1st and that they were.
Prepared now.
Fast forward several months.
There was a lot of follow up phone calls and follow up visits, but the bottom line was this business wasn’t quite ready to make the decision yet.
There were a lot of other things that had to happen before this that were much more important, and this was pretty much at the bottom of the list.
But this person had pretty much already closed the deal, and it was pretty much a sure thing that this was the business that was going to be used when it was time.
So how did this guy screw things up at the very last minute of closing a deal?
I happen to be here in this business as this salesperson came to close the deal.
And there were questions that were lingering that he was unable to answer.
And he didn’t seem at all interested in trying to find the answers.
He only seemed interested in closing the deal and he started going to a really high pressure sales tactic of listen sign the contract now and we’ll figure the rest out later.
But this was a decision that did have to be made, and even though it was at the bottom of the list, it was still an important decision.
And there were questions that remained unanswered.
I don’t understand why this salesperson couldn’t just get the answers to the questions, whether it’s calling a colleague calling a manager somehow get the answers to the questions so they could be satisfied and he would have closed the deal.
Instead, he insisted on doing this high pressure sales routine when he already pretty much had the deal closed and there were just a few details.
That needed to be ironed out before signing on the dotted line.
What ensued shortly after was nothing less than what I would call almost some type of emotional.
Breakdown over not being able to close the sale at this moment.
Now I don’t understand what pressure he might have been under as a sales person.
Maybe it was towards an end of the month and his entire livelihood depended on closing this one deal, but nonetheless he really freaked out when the decision was made that we’d have to put this on hold for a little while to finish up the details and get to the bottom line.
Of what would have to happen for this deal to close?
This guy basically went on a tirade about how his time had been wasted and this can’t happen because he had just closed a deal with someone else for way more money.
It only took two.
20 minutes, So what the hell is wrong with you?
Why can’t you sign right now and just get this done?
I stood there and my jaw dropped.
I was just shocked that this person was having this type of meltdown when all they had to do was say let me get you those answers and I’ll come back and we’ll close the deal but they didn’t.
Instead they got really defensive.
And they essentially went on a tirade which ended with the business owner basically saying you know what I’m done with you get out of my.
Shop and this guy basically just had his six months of work go down the toilet because of some weird lack of patients.
It was really something I’ve never seen before, but I guess you see everything if you’re around long enough, but it did start making me think what happens when people lose a sale and what are some of the things that you should.
Do and certainly things that you should not do.
If you do lose this.
You know, and I want to start with the first, which I think this applies to a lot of things in life.
But don’t be defensive this this this guy really got defensive about the idea that this might be prolonged another day or two, or if he was able to call someone and just get the answers.
It might have only been prolonged 5 or 10 minutes, but he just was.
Unwilling to try to satisfy the objections that were on the table at that moment, and they were very, very minor objections at that moment.
And instead of just politely saying either I don’t know the answer to this and I will find out.
Or maybe he couldn’t do it at that moment, but I can get back to you first thing in the morning.
He would have closed the sale and everything would have been fine, but instead he got very.
And he basically said, why are you being difficult and why don’t you make this easy on me because I’ve worked hard and this is something that nobody wants to hear because we all work really hard.
And if you’re a business owner, you know how hard you work and the last thing you need is someone coming to your business telling that somehow you’re not valuing their time.
As a salesperson and it was, it was really kind of disgusting to watch and it shocked me that this person had a meltdown like this.
But here’s the thing.
Here’s why you don’t get defensive one.
And I’m going to assume that all object objections have been satisfied at this point.
OK, so I’m using this story as an example because it made me think this is the episode I want to do, but the reality is I’m going to assume that you’re not a lunatic and you didn’t have a complete meltdown in front of a client, but for one reason or another, that client decided to go in a different direction.
Number one don’t be defensive because you don’t know the data points that they’re looking at.
You don’t have the same perspective as the prospect that you are trying to close, so you may think you know what your competitors are offering, but you may not know things that they.
You know that are going to persuade them to go with one business or another. A perfect example of this is maybe you offer a product or a service that you know is 10% less expensive than every single one of your competitors, and you know that it’s 50% better quality than any single one of your competitors. So in your head.
You’re picturing this is a no brainer.
We’re a better product, we’re less expensive and let’s just assume all things are completely equal between you and the competitors.
Except these few variables.
But yet you still lose the business.
Competition well, why is that happening?
There’s a couple reasons that this could happen.
One example would be.
Maybe it’s just simply financing terms.
Maybe your product is less expensive and the competitions is an inferior product?
That’s a lot more expensive, but they offer some sort of flexible financing that makes it much more affordable for that business.
And maybe, regardless of the savings, that business just doesn’t have the money to spend right now, but if they can divvy it up over 12 months or 24.
For months, especially with the no interest promotion, then it’s worth it to them to pay a premium for the product to secure better cash flow and to better manage their expenses.
Another example could be something as simple as the competition is.
Maybe a family member or a relative and they just want to do that person a favor.
There really is no logical reason why they wouldn’t go with your product.
It was somewhat illogical.
But the bottom line was they decided to go with the competitor.
That’s just another example.
But here’s the thing.
If you know that you are offering a better value and you know that you’re offering a better.
Product and if you know you’re offering a better price, there’s a good chance that these people may come back to you.
This is why I say if you lose the deal, it doesn’t mean you’ve lost it forever.
This is still a business that will need services and products in the future, and you want to make sure you keep that door open so you never want to be.
Defensive when you lose the sale, you want to be empathetic and you want to be thankful for the opportunity that you had in the 1st place to even pitch the prospective client.
And keep in mind, even though you may feel that your time was being.
Wasted that business owner has also had to waste time listening to your pitch and ironing out the details of your deal.
So you’ve mutually spent time and it didn’t work out, but that doesn’t mean game over.
There’s always opportunities in the future.
Depending on the lifecycle of the product or service, maybe it’s a week.
Maybe it’s a month.
Maybe if you know it’s something where someone.
Opt in.
Three years, then maybe it’s something that you have to deal with a few years later, but that follow up.
We’ll get to in a second second thing you want to do when you lose a sale is you want to try to gather as much information as possible, and this isn’t always so easy.
Sometimes someone will just say hey listen, I I made a different decision.
Thanks a lot.
Have a good day and hang up on you.
Other times you might have the opportunity to actually gain a little insight, and the client might share with you why they went with the competition.
If you are polite and you’ve been affable through this entire.
Process, it wouldn’t be inappropriate to simply ask.
Oh, just out of curiosity, what was the selling point that made you go with the other company and you might gain some insight that you can use later and we will get into that a little bit more in a moment.
One thing you want to do in this process is keep detailed notes and this is something that I don’t.
See, a lot of salespeople do as much as they should, but the more notes you keep on someone.
The more information you’re going to have at your disposal, and the more you will increase your ability to sell to this perspective client in the future.
You can never take too many notes.
You should always summarize the calls you have because especially if it’s a three year lifecycle of that particular product or service.
You’re not going to remember three years later.
What you discussed three years before, but if you keep little notes about things that this prospect shared with you, you can bring those back.
And it sounds like you are someone who will really have your stuff together.
I once walked door to door with a political candidate who would keep notes about every house he visited.
The conversations they had, things that were happening around the house.
So for example, if someone was doing a landscaping project in the front of their house when they come back a year later, they would say, oh hey, I remember last year you were working on the landscaping.
This really looks beautiful.
You did a great job.
Oh, and how’s the dog and things like this?
It would fire up that conversation and it was very impressive.
If you didn’t know that he was referring to.
Notes prior to going to the door person kept detailed notes for every house in conversation that he had specifically so he could bring these things up later on, and it was very effective.
People were really appreciated when you asked about their family.
You ask about their pets and you remind them what an incredible job they’ve done on projects around the house.
And this is something that.
Can certainly be applied to any business.
Again, just take good quality notes and I’m going to go back for a second piece.
I’ve mentioned it a few time.
Times this podcast is not sponsored by HubSpot, but I’ve mentioned HubSpot a few times because they do offer some really great free tools that help you keep track of things like this.
It’s a customer relationship management system that is easy to use.
You can define your client and then you can add notes.
You can add call logs when you call them.
You can add follow up tasks reminder tasks.
All these things built into one free system.
And I encourage that if you don’t use this, you can use Outlook.
You can use your Gmail, but take the notes for each client.
Make sure you have follow up whenever possible, so if you’re lucky you will learn what you did wrong and why you lost the deal and maybe it’s something you can address and fix in a future prospect.
Or maybe it’s something that.
Simply, you cannot compete with or.
It’s something like we said where, oh that was my brother in law, and I went.
I went with him because.
He was family and he needed the business and it’s not something that you did wrong or something that was wrong with your offering, but at least getting this feedback is something that is really smart and it will help you better develop your product and better develop your sales pitch later on.
The next thing I want to talk about is focusing on that feedback, and even if it’s not the feedback of that particular client, maybe.
Someone else gives you feedback about a sales process that didn’t work out.
You really need to listen to it, especially if it’s price sensitive.
Because if it’s price sensitive, you only have two options.
You can lower the price to get the deal or you need to increase the value of the product or service you are selling.
And nobody does a better job of selling value than Tesla. For example Tesla Autopilot. As of the recording of this episode in 2021.
Currently costs $10,000 to add onto the car. Now what’s interesting about this is that full Autopilot isn’t actually a thing yet.
But Tesla is promising that you will get this value in the future. That will be worth far, far, far more, and they’ve already increased the price from 4000 to 6000 and now $10,000 in a very short timeframe, because people are willing to pay more for better value, and Tesla is selling this value.
Incredibly well, they’re saying listen in the next few years, we’re going to have autonomous driving and this is going to be worth $50,000 or more.
Or why not pay the 10,000 now and we’ll upgrade your car when it’s ready at no cost to you.
This is really something that shakes up the auto industry, but it’s also a good example about how a company can sell value in this case.
They’re collecting money for something that doesn’t even exist yet, and many, many people.
They’re buying it, as can be seen by their stock price.
They’re doing a pretty good job and they have fulfilled partially these promises by adding lots of really cool features to cars that are two, three or four years old, which again is unheard of in the automotive industry. But let’s take a lesson from Tesla’s process and say, how can we deliver?
Enormous value.
If you don’t want to compete on price, then you have to compete on value.
Think about all the ways that you can increase the value of the product or service that you are selling.
Refine it and put that as part of your sales copy and part of your pitch.
Now let’s assume you know you’ve got the best product you’ve got the best service you’ve got the best terms.
But the client went with his brother and.
Who was desperate for business and you have to wonder why was he so desperate for business?
And maybe it’s because he’s just not that good.
So you can probably surmise that things aren’t going to work out in the long run in this situation, and the business has to have the proper product or the proper service, and eventually the whole brother-in-law thing is going to wear thin and the business owner is going to decide.
They have to move on to a different company and here is where that follow up is so paramount.
This is permission based marketing.
You’re going to want to ask the client when the deal falls through, say, hey.
Listen again, if everything is amicable, this shouldn’t be a big ask, but you want to say hey, listen, do you mind if six months from now I give you a call just to see where you’re at and make sure everything is good?
I hope that everything goes wonderful for you.
I hope you save a lot of money.
And I hope this product exceeds your expectations, but if for any reason it doesn’t, I just want to touch base.
Maybe again this has to do with the industry and how.
Of course is relevant to whatever product or service you’re selling, but maybe it’s maybe it’s a month.
Maybe it’s six months.
Again, if it’s, let’s say, it’s an equipment that’s going to be leased for over three years, maybe 2 1/2 years later, you want to get a jump on your competition.
Who is the existing clients provider?
But you want to get a jump on them because you know they’re going to want to renew the lease?
For three years, but if you can get in a little bit early, that’ll give you the opportunity to maybe undo what your competition is planning on offering, and give you a jump start.
It will also make you look more prepared than your competition, because now you’re already calling saying.
Hey, just so you know you you we spoke three years ago or 2 1/2 years ago. Your lease expires in six months.
Have you given this? Any thought? Do you know what type of pricing? And again you get ahead of the game now you’ve put this seed in the client’s head where they’re going to think.
Oh wow, OK yeah, I didn’t even know how come I didn’t hear from my current provider.
Why didn’t they tell me it was going to be?
Six months so, so this is a great way to again get in early before the client even thinks about making that decision.
You can get your foot in the door and you can get yourself back in the running, but you gotta make sure that you do the follow up and I know sometimes in business, especially in sales, when you look out.
A year, two years, three years.
It seems a little daunting to think that you’re going to have a follow up a three years later, but if this happens 10 times a day, three years from now, you’re going to have a really, really good year.
If you keep on all of the follow up, so keep detailed notes and always follow up.
Now of course this should be.
Obvious but be thankful for the OP.
Tunity keep the door open and don’t burn the bridge in the story in the beginning of this, this guy burned a bridge.
I can guarantee you that this business will never hire this guy ever.
Will never consider him in the future.
And because I was standing there and heard it happen, I can tell you I will never consider this guy in the future because.
It was just insane how this process went down.
Again, if I wasn’t there, I wouldn’t believe it, but people tell me stories like this all the time and I normally don’t entirely believe it.
I always think, oh, there must be some other perspective or maybe something else was going on that I don’t have all the information on.
I I just can’t imagine how you could be in a sales process like this and get this far to the very end.
And then just completely blow a deal by just being a complete.
And Rec as a sales person so so don’t burn the bridge.
Always keep the option open and always ask if it’s OK to follow up later on and most people are going to say yes.
And if they say no, then maybe it is a done deal and you could probably three years later follow up anyways, and you’re probably not going to go to jail.
For violating any type of spam rules, and of course all of these things help to move the needle on trust companies.
And I use Apple a lot as an example.
Apple will come out with the new iPhone every year.
There’s a new iPhone people are waiting in line to buy it before they’ve ever seen it or use it.
Or gotten a single testimonial from another person?
Why simple?
It’s trust.
People who have bought an iPhone every single year have gotten.
A really good product and most people are incredibly satisfied with it. They’re usually incredibly satisfied with the upgrades and they just know now and trust that they’re going to spend 1415 sixteen $100 on a.
Phone and that it’s going to be better than what they had the year before, and that is done by delivering a consistent product with a consistent quality with consistent service.
And even if you don’t land the deal, you can show these qualities to a prospective client and maybe again.
A year down the line, two years down the line you will close that deal and because of all the legwork you had done prior to that, you will have a better shot of renewing that deal or selling more product or renewing a service contract over and over and over and over again, because people just want to work with people that they can trust.
And rely on.
I’ve said it many times in this podcast.
If I ask you what your number one customer service experience is, you will probably instantly think of some incredible experience and share it with vigor and excitement.
And if I ask you what your second best experiences your.
Probably really, really going to think about it.
And if you are like most people when I ask you what your third favorite customer service experience is, you will fall flat and you cannot come up with an example.
So this is the benchmark that we’re dealing with right now.
Most people in America can’t come up with three examples of incredible customer service.
This is your opportunity.
This is your calling.
This is where you can set yourself apart from everybody else and it shouldn’t even be that difficult because.
It doesn’t take much to impress someone these days because we are all treated like numbers.
We’re all.
Just COGS and corporate wheels and we get tired and worn out as consumers.
And we just always assume the worst when dealing with people, and that’s why when we get that little glimmer of optimism and that little glimmer of hope and a little taste of what service really should be, suddenly things like price isn’t that expensive anymore.
We don’t really negotiate things as well as we should, because we’re just.
Happy to have someone that we can trust and that we can put our faith in and who’s going to consistently provide a good quality?
Product or a good quality service and all the things that go along with that.
So I hope this episode is helpful and I hope it gives you some things to think about when you lose a sale and I know nobody wants to talk about losing a sale.
No one proud of themselves when they lose a sale, it’s always difficult.
It’s never easy but.
Take it as a learning XP.
And think to yourself, why did you lose it?
Try to find out why you lost it and then try to find out how you can win it later on.
And while this is probably not going to improve, your odds of closing a sale today, it will certainly improve your odds of building greater long term customer relationships.
Down the pipeline, which, if you are someone in sales and you want to do this for the rest of your life and this is your career, then that should be extremely important.
In fact, that should probably be the most important thing on your mind is how can I build a network?
Of people that I can rely on as clients for the next ten, 1520 or 30 years. Thank you so much for listening.
Today I’m Justin varuzzo. You can reach me Justin at marketingandservice.com again if you enjoyed the episode. Please like subscribe and if you have any questions shoot me an email that’s Justin at marketing.
Service com justin at marketing and service com.
Of course, you can always check the website for my afterthoughts of every episode, and if there’s something you want to hear about, just let me know.
I’m always looking for ideas for new episodes, so keep me in the loop and I promise to keep these episodes coming.
Thank you so much and have a.
Great day.