Tag Archive | "Sales"

Questions Are the Answer

When you work with a new-car prospect, don’t you agree that you should try for several minor “yeses” before you go for the big “yes” buying decision? It makes sense, doesn’t it? It would be helpful to learn a specific technique that would begin a string of “yes” answers, wouldn’t it? You’re probably getting tired of all these questions, aren’t you?

If you answered yes to these four questions, you’ve just proven the effectiveness of the “tie-down” questioning technique. Let me begin by defining the term tie-down. A tie-down is a question at the end of a sentence that calls for a positive response. Here are some examples:

“A reputation for excellent service after the sale is important in making this decision, isn’t it?”
“I can tell you are happy to hear that we have a wide range of financing options, aren’t you?”
“You can see how our evening service hours would make your life easier, can’t you?”

This technique works most effectively when you tie-down a positive statement about the benefits of your services that you know your prospect needs. The key is to not over-use them so your prospect won’t suspect you’re using a technique. Here are 18 standard tie-downs that you’ll find useful:

Aren’t they? Don’t we? Isn’t it?
Aren’t you? Shouldn’t it? Isn’t that right?
Can’t you? Wouldn’t you? Didn’t it?
Couldn’t it? Haven’t they? Wasn’t it?
Doesn’t it? Hasn’t he? Won’t they?
Hasn’t she? Won’t you? Don’t you agree?

You don’t want to use too many of them with any one client, just enough to get the “yeses” flowing. Experiment with your existing presentation until you find a comfortable number of tie-downs to use without sounding repetitive.

Another way to keep these tie-downs from sounding overused is to use them in other forms: “inverted” and “Internal.” I’ll use the same example as above to demonstrate them.

STANDARD: A reputation for excellent service after the sale is important in making this decision, isn’t it?
INVERTED: Isn’t a reputation for service after the sale important in making this decision?
INTERNAL: A reputation for excellent service after the sale is important, isn’t it, in making this decision?

The inverted and internal tie-downs allow you to hide the fact that you’re using a technique while adding warmth to your statements. By using all three types, you’ll have a good mixture of them to build into your presentation. Once you’ve learned them and worked with them, use of the tie-down will become a speech habit that will improve your business and your earnings.

Another form of the tie-down you might consider using is the “tag-on tie-down.” It can be used in a variety of ways. The simplest is to tie down a positive statement your prospect has just made. For example, if he says, “Having a good extended warranty is important,” you would say, “Isn’t it?” The prospect made a positive statement and you agreed, but then you also asked for another positive statement. The statement being the word, “yes.”

Another useful questioning technique is the “Alternate of Choice.” An alternate of choice question is one that suggests two answers, either one will confirm that your prospect is going ahead. The easiest example of this is for getting an appointment. The average salesperson will say to their prospect, “When can we get together?” This allows the prospect to say, “Never” or “I’m too busy just now, I’ll call you later.”

In using the alternate of choice question, you would say, “I have an appointment opening this afternoon at 3 p.m. or would 4:30 p.m. be more convenient for you?” You’ve given your prospect two choices, one of which they will most likely agree to. If they cannot make either appointment, they’ll tell you and you can counter with another alternate.

This is also a good technique to use when you try to get a delivery date from your prospect once they show signs of going ahead. “You mentioned wanting to remove some things from your current vehicle. How soon would you want to take delivery of your new truck? Today or would tomorrow be better?” Just remember to use it whenever you have two alternatives you can give to your prospect, and both of them require a positive response.

These two simple questioning techniques are the first steps to turning your existing presentations into positive momentum builders. Remember, a quick reading of these techniques will not do. You need to read them, study them, learn them and practice them until they become a natural part of your speech. If you have to stop and think before using these techniques, your prospect will suspect you are using a sales technique and will try to fight you. Once they’ve become a natural part of your speech, they will flow smoothly and add warmth to your presentation. All it takes is one “yes” to turn a prospect into a satisfied client.

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The Art of Selling

When assessing a process for successful selling, don’t overlook the value of providing a service to your customers. The catch is that putting the customer’s needs first is not easy if you don’t know what their needs are.

Most customers have no idea how products offered in the finance office can benefit them. Therefore, having a conviction and understanding how the customer can benefit from and save unforeseen costs by using the products you offer is necessary to convey the value that is available for them.

Exploring what the customer wants to accomplish and then offering solutions is really as integral to the sale as getting the customer’s name. The questions you ask are the most important part of your sales process and discovering your customer’s needs requires some honest dialogue.

Don’t get caught up in interviewing everyone the same way, because not everyone is the same. You should have a variety of questions that allow you to make the customer comfortable while you extract information necessary to determine how they might benefit from what you’re offering.

If you believe it, they will see it!

If you subscribe to the 80/20 rule as a fundamental basis to sales, then you need to apply that same rule to the time you take to interview your customer. It is nearly impossible to sell anything until you establish why your customer would want your product and how they would use it.

Spend the necessary time determining that need and then build your features and benefits around their specific experiences and circumstances. Remember, one size does not fit all prospects. Tailor your products to fit your customer. The only way you can size the customer up for a good fit is by doing a quality needs analysis to determine exactly what their needs are.

Also, don’t struggle when asking your customer what they want to accomplish. If you subscribe to “consultative selling,” then you should understand that you can’t properly advise unless you find out as much information about the person as possible.

Only by asking questions are you able to determine what your customer is telling you. Also, it is a good idea not to use metaphorical examples that don’t apply to a person. Nobody wants to be challenged in the way of their personal finances or responsibility to their family. They know their circumstances better than you.

Having already asked the most important question of your customer, “How can I help you?,” you should move forward with that thought and help them – not provide advice or improperly challenge them! Follow-up questions can help provide additional information on how the benefits of your products fit your customer’s lifestyle, without sounding prying.

However, you first have to gain their confidence with your professionalism. You have plenty of product and inventory knowledge, but you have to apply all that to the customer’s needs.

Differentiate yourself from the last place or person who wanted to sell them something. Get to know your customer and your customer will be impressed and thankful for the time, service and information you have made available for them.

Just like you, everybody appreciates doing business when the interaction is comfortable and pleasant. A true professional works to ensure that her customer is in good care and given good advice. It only becomes comfortable for our customers when we start to learn about them and the parts of their life that they share with us that are applicable to the products that we have to offer them.

Building rapport is important, and if the customer thinks you are hard selling them, they will disconnect. People buy from people they like and from people who they think are credible. If you really care about them and their needs, they will realize your presentation of product(s) is more of a lesson of benefit than a “sales pitch.”

As the saying goes, “They don’t care how much you know, until they know how much you care.” When we are able to make that connection, the process becomes productive for them and profitable for you.

Remember, the question you have to ask yourself is, “Am I asking the right questions?”

A fundamental sales process asks you to greet and meet the customer so you may better understand their needs. But, listening to what your customer is saying is a key component to this process and it will give you the opportunity to provide them with your specialty service. The “art of selling” happens when you discover “the art of service.”

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Avoiding Awkward Beginnings

When you meet someone for the first time in your dealership, your goal is three-fold. You want to get them to

  1. Like you
  2. Trust you
  3. Want to listen to you

Those three elements are absolutely necessary for them to make a buying decision based on the information you share with them.

If they came in after calling and speaking with you, it’s likely you said the right things on the phone to get them to at least come in and see what you have available in both vehicles and terms. You’re starting out on the right foot here. They’ll be curious to learn more. That means they’ll be listening to you.

However, their curiosity will only take them so far. Once they’ve gotten the basic idea of what you have to offer, they’ll need to like and trust you enough to want to do business with you rather than taking their newfound knowledge to another dealership to see what might be different or better there.

To help people to like you, you must be likable. That’s pretty simple. Develop the traits you admire in someone you deem as being likable. These could include having a relaxed manner. In addition, understanding and using some of the more formal courtesies is also helpful such as introducing yourself with both your first and last name. Use the clients’ last names (e.g., Mr. Smith, Ms. Jones), until you feel them warming up to you. Then, you will have earned the right to ask to use their first names.

If they only give you their first names, that’s a sign they don’t feel comfortable with you yet. Go ahead and use their first names a few times during your initial conversation. I recommend this for two reasons. First, it will make them feel important. Second, it will help you remember their names.

In this business, we meet a lot of new people on a regular basis. Learning simple strategies to remember names is important. I recommend repeating the clients’ names to yourself four times immediately after they give them. It’s a strategy I’ve used for over 30 years and it works. Bob and Sally Brown. Bob and Sally Brown. Bob and Sally Brown. Bob and Sally Brown.

Another way to be likable is simply to smile. It may seem obvious, but if your mind is on a personal matter or if you’re worried about meeting your quota this month, it’ll show in your face. Your face muscles will tense up. You won’t be smiling and the prospective clients will likely see dollar signs in your eyes. To avoid that situation, really look at your clients (but don’t stare them down) and smile with your whole face. You’ll be focused on them and anything else that’s been on your mind will be forced away for the time being.

It’s human nature to like people who are like us or who we recognize as complementing our personality styles. People tend to like others who smile, make eye contact, are courteous and are interested in them. These traits make those with whom you come in contact feel as though they are important to you.

To begin building trust, establish common ground. If you’re a fan of the same sports team, if you have children the same ages or if you belong to the same community service organization, they’ll see how much you are like them. Seek areas of common ground by asking questions about the situation that has brought them in to see you. You need to determine their needs without coming across as if you’re interrogating them.

It happens plenty of times that a young couple will come in looking for a minivan, but fall in love with an SUV. Someone else might come in seeking the same kind of vehicle they’ve driven for 15 years even though their driving needs have changed. You could easily help them see the advantages of a different type of vehicle…if you ask questions about their needs.

It won’t hurt, if in conversation, you are able to tell them about a situation with another client they may be familiar with (maybe a friend who referred them to you) or where you demonstrated dependability. Be careful not to sound like you’re bragging. Use the term “we” as in “we, the company” when relating information about other clients or situations. That way, if they’re even the least bit shaky on their opinion of you, they’ll build faith in the fact that the company stands behind their promises.

Look and listen for ideas about what’s important to this person beyond their interest or need for a vehicle. If you don’t see or hear anything that you would feel comfortable asking about, don’t become anxious. You don’t want to create an awkward situation by looking like you’re struggling to come up with a subject. Avoid the weather unless there’s some unusual weather phenomenon occurring; it’s just too trite.

Train yourself to keep in mind: like me, trust me, want to listen to me when approaching every prospective client and you’ll soon find yourself doing the things you need to do to win them over.

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The Most Important Questions in Business

Entrepreneurs can’t completely inoculate their businesses from the vagaries of the market. What they can do is wrestle with the fundamental questions that govern the fate of any enterprise.

Digging for those answers is a grueling exercise–one that takes serious intellectual and emotional honesty. With any hope, the process begins long before money’s been spent, products are built and customers are lost.

The real challenge, though, is to keep digging. As businesses grow, new opportunities and threats emerge, and yesterday’s answers probably won’t suffice. Relentlessly asking the tough questions is how the Microsofts, Wal-Marts, Hewlett-Packards and Googles stay on top.

With that essential struggle in mind, Forbes.com presents some of the most important questions entrepreneurs need to answer–and keep answering–to build thriving businesses. Some highlights:

What is your value proposition?
If you can’t explain–in three jargon-free sentences or less–why customers need your product, you do not have a value proposition and thus, you do not have a business. Period.

Does your product address a viable market?
Seinfeld’s Kramer was convinced that the Mansierre (a bra for men) was his ticket to riches. Not that he did any research to confirm that there was a viable market, let alone one large enough to attract investment capital. Never assume you can create demand where it hasn’t already been expressed. Don’t hawk the next Mansierre.

What differentiates your product from the competition?
It’s true that Starbucks made people believe they wanted $4 caffeinated concoctions, and Louis Vuitton lulled people into shelling out $1,500 for denim handbags. But marketing alone won’t cut it. If you want to win in business, you need to deliver tangible value where other companies don’t. Examples: rock-bottom prices (Wal-Mart); ingenious product design (Apple); extreme convenience (FedEx). Find your edge and hammer on it.

Does the business scale?
The difference between modest wealth and obscene riches is “scale.” Scalable businesses are those that can produce the next widget at a fraction of the cost. Think software: Once Microsoft shelled out to develop the code for its Windows operating system, the incremental cost of printing each additional copy was next to nothing. What models don’t scale? Think service businesses, where the need for people grows with revenue.

How committed are you to making this happen?
You have a family and two kids. Are you ready to burn 100 hours a week for the next two years to get your start-up off the ground? Fair warning: If you want to run the show, get ready to give everything–and then some.

What price will your customers pay?
Why will people pay twice as much for Clorox as they will for generic bleach? Who knows, but nailing the upper limits of what customers will pay, be it for an iPhone or a bottle of bleach, is one of the biggest levers in any business model. Consultants get paid handsomely to help companies arrive at the right price.

How much power do your suppliers have?
The fewer number of suppliers, the more sway they have. A knotty-pine grandfather-clock business may sound great, but what if there’s only one source of knotty pine? Answer: You’re going to pay. On the flipside, beware getting hooked on hungry, low-cost providers who don’t keep an eye on quality.

How should you sell your product?
Dell Computer bypassed retailers and sold directly to customers, with limited tech support. General Motors and Coca Cola rely on distributors to move their cars and cans. Clothing companies like Ralph Lauren work both internal and external channels. And Apple keeps adding more of its own airy and fashionable outposts, complete with live product tutorials and throngs of geeky customer-service agents. Whatever sales method you choose, make sure it aligns with your overall business strategy.

How should you market your product?
Getting the word out about your company–without going broke–is no mean feat. In the mid ’90s, America Online spent so much money flooding the planet with free trial software that it tried to mask the bleeding by capitalizing those expenses on its balance sheet. (Regulators later nixed that accounting treatment, wiping out millions in accounting profits.)

How much cash do you need to survive the early years?
For those who slept through the previous section: Again, mind your cash. Plenty of entrepreneurs boast hockey-stick-shaped financial projections but turn out their pockets before the good times have a chance to kick in. (Remember all those busted dot-com companies from the tech boom?) Hold back on the Aeron chairs and mongo Mac computers until more cash is flowing in than out–and then add plenty of extra cushion.

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Repeat Customers Increase Close Rates, Decrease Dealer Expenses

Wouldn’t it be great to have a solid previous customer base about now? Wouldn’t it be great if all of those customers you’ve sold to in the past who are ready to trade today would come back in to see you? Your lot would be filled with traffic, and the best part, repeat customer traffic closes at 70 percent – with gross profits 40 percent higher than your typical walk-in prospects.

It gets even better because you have almost no expense in generating these extra sales and the higher gross profit on each of these types of sales. Repeat customers pay you more because they already know, like and trust that you’re a good dealership to purchase from. Plus, your expense drops from the $500 or so per sale range in advertising and other expenses to just $25 to $50 per unit from a continuous follow-up and retention process.

With retention, you sell more units and raise the gross on each one, with no added expense. To see that in numbers instead of words, let’s take a look at the typical 100-unit dealership with $2,500 gross front and back that is spending $40,000 to $50,000 on advertising (or more in today’s market).

The breakdown of the typical dealership’s sales is 70 percent from high-expense, low-gross, tough-to-close walk-in traffic, while only 30 percent of its business comes from low-expense, high-gross, easy-to-close repeat, referral and dealership customers (service, parts and employees).

Now: 100 units x $2,500 = $250,000 in gross profit

If you are typical and if this is your 100-unit dealership, you end up with a $2,500 average per unit because 70 percent of sales (70) come in at $2,232 per unit and only 30 of your sales come in 40 percent higher at $3,125 per unit:

  • $156,250 (70%) from walk-ins (low gross)
  • + $93,750 (30%) from repeat customers (high gross)
  • = $250,000
  • ÷ 100 units
  • $2,500 average

Now, let’s go back and look at the difference retention would have made if that had been your focus instead of spending your money and time trying to draw a crowd of tough-to-close price shoppers.

If you had been focusing on building your repeat business over the years instead of advertising, and were now doing 70 percent of your sales from higher gross customers and only 30 percent from walk-ins, the numbers would look more like this instead:

  • 70 repeat units @ $3,125.00 = $218,750
  • 30 walk-in units @ $2,232.14 = $66,964
  • Total Gross = $285,714

“Good Gross” is gross you generate without spending extra money to generate the sale or the gross. Because there are no other expenses, good gross sends all but sales and management compensation (about 40 percent) straight to the bottom line.

So at $285,714, because you didn’t have to spend any more money to generate that extra $35,714, about 60 percent would become bottom line net profit. That’s $21,428 to the net.

And that’s just the first benefit; the second is the money you’ll save because the cost-per-sale drops from $500 per unit in ads, etc. to $50 per unit to retain those customers. That means you save $450 per unit on 40 additional repeat sales for another $18,000, which is 100 percent bottom-line savings (pure profit).

$39,428 Extra Net Profit per Month with No New Expense

A common question is whether those repeat customers will still come in if the market has changed. The answer is: absolutely! Even if buying cycles lengthen, someone in your repeat customer base…

  • Is paying too much in maintenance and needs a car now.
  • Needs a car now for his high school/college kids.
  • Just wrecked her vehicle yesterday and needs a car now.
  • Has to trade now because his lease is expiring this month.
  • Just wants a vehicle and can afford to get one now.

Even if you didn’t increase volume by a single unit, if you focus 95 percent of your attention on retaining your customers, you’d still be netting an extra $39,248 per month ($473,136 per year). Unfortunately, instead of learning how to manage consistent growth year after year, most dealers and managers focus on filling their lots with expensive, hard-to-close, low-gross, walk-in, price shoppers.

Oops, we have a problem: you can’t manage what you don’t monitor. Too often there’s no tracking in most dealerships to give you the breakdown of floor traffic (opportunities) by type of customer (walk-in, repeat, referral, be-back, service customers, phone and Internet).

Why does it matter? Because if every dealership just tracked their sales and gross by each group, they’d immediately realize that walk-in traffic is their worst source of business, and all of the other groups are their best sources of business.

If they don’t track and don’t understand these differences, they have no goal on increasing their business to their least expensive, easiest to close, most profitable sources of business who will continue to buy in any type of market.

My book, A Dealer’s Guide to Recovery and Growth in Today’s Market, provides ways to add extra units by improving salespeople’s selling skills. Real dealerships are featured that have experienced

  • Unit sales increases
  • Gross increases
  • Four times as many be-backs
  • Dozens of extra sales through phone and Internet appointments, prospecting, retention

These dealerships have improved their businesses while many others are just hanging on or closing their doors.

You can grow any time you want to! But you can’t grow at all if you aren’t willing to make changes to how you manage and how you sell.

A Dealer’s Guide to Recovery and Growth in Today’s Market is free and includes much more information than I can cover here. I can’t imagine why anyone who relies on sales for a paycheck would put off thumbing through or reading a free book on how to improve their sales and profits 20 percent to 30 percent overnight.

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Closing Is Sweet Success

In the selling profession, closing is the winning score, the bottom line, the name of the game, the cutting edge, the point of it all. You may do everything else right up to the point of closing, but if you can’t ask for the business and wait for the client to answer, you’ll never do better than average in sales.

There are lots of techniques for prospecting, meeting new people, building referrals, qualifying, presenting or demonstrating products and services, and overcoming objections (also known as addressing concerns). But, if you can’t close the sale, you’re like a football team that can’t sustain a drive long enough to score. It does you no good to play your whole game in your own territory and never get across the other team’s goal line.

You have to fall in love with closing if you’re going to succeed at it long term. If you don’t love the closing process enough to master it now, start falling in love with it because this is where the money is.

True professionals are closing all the time. They close for names and contact information. They close for appointments. They close for opportunities to present their products or services. They are constantly trying test closes, and they can kick into their final closing sequence any time they recognize verbal or visual buying signs in their potential clients. Signs can include handling the product or asking for information they will need to know when they own it.

Many average salespeople get so wrapped up in their selling sequence that if potential clients decide to invest before they’re through, they won’t let them have the product. They feel compelled to finish their entire presentation. They just keep going in their set pattern of telling, telling, telling instead of selling.

Some clients do get sold quickly. If you keep talking instead of moving to the paperwork, you could very easily unsell them just as fast. More talk triggers more thought and has the potential to bring up more objections. Pay close attention. When you recognize that the prospect is ready, stop talking and start filling out those forms, getting that purchase order number or asking how they would like to handle the investment.

Next, I’m going to give you the eight most important words in the art of closing. These are the most powerful words I’ve ever heard spoken on the complex, demanding and well-paid art of closing. If you’re just skimming this article, PAY ATTENTION NOW.

Whenever you ask a closing question, shut up!

The important words are “shut up.” That is why the Father of Modern Selling, the late J. Douglas Edwards used to shout this at his audiences.

I was sitting in the front row at his seminar the first time I heard these words. I was already jumpy from the excitement of the program and had my head down taking notes as fast as I could, when Doug shouted “SHUT UP!”

I jumped right out of my chair and dove for cover. That memory is carved into my mind, along with those words. They explain the single most important element that turned my previously disastrous sales career into the record-breaking success it soon became.

Ask your closing question then keep quiet! The first person to speak owns the product. If you speak, the product will still sit in your car or warehouse. If the client speaks, the majority of the time, they’ll own it! They’ll either agree to make the purchase or ask a question. Either way the sale is still moving forward.

Being quiet sounds simple, doesn’t it? Believe me, it isn’t. I had a real challenge in this area and I didn’t have a clue as to what I was doing wrong until I heard Doug Edwards say those words. I was a talker early in my career. I thought if I just kept talking that eventually the clients would agree to something I said.

The first time I tried to ask a closing question and then keep quiet, I was prepared for the prospect’s reaction. I expected her to keep silent—thinking about her decision. What I hadn’t prepared for was the intensity of my own reaction.

The silence felt like wet sand being piled on my chest. My insides were churning, I had to bite the inside of my lip and I was acutely aware of every nerve ending in my body. It was a gargantuan struggle not to fidget. I was wiggling my toes inside my shoes so I didn’t start jiggling my leg. Finally, the prospect did decide that she would invest, my body flooded with adrenalin and I never again dreaded that awful silence after asking a closing question.

Why is it so important to keep quiet? Let’s say the prospect hesitates for a few moments, wondering when he should take delivery. You become uncomfortable and assume that he is questioning the investment, so you blurt out that you’ll give him another 5 percent off the total investment or something free, when that wasn’t even the issue.

Now, you’ve just broken the trust you worked so hard to build to the point of closing. You’ll have to work twice as hard to earn the business because now he’s wondering if you truly have his best interests at heart.

There’s no way you can possibly know what potential clients are thinking when they’re quiet so don’t try to guess. Just sit and wait them out.

The average salesperson can’t wait more than 10 seconds after asking a closing question before saying something else. If “Mrs. Jones” hasn’t answered by then, they’ll say something like, “Well, we can talk about that later,” and go on talking, unaware that they have just destroyed the closing momentum.

And it’s probably not just the one close that is destroyed. “Mrs. Jones” can certainly keep quiet for a few moments—almost all undecided buyers can. She may now start to wonder what else you’ll tell her or offer her if she keeps stalling her decision.

If you’re true champion material, you can sit there quietly all afternoon if you have to. It takes concentration, but the actual silence after asking for the sale rarely lasts longer than 30-40 seconds. Try it now. Check your watch and just sit quietly for 30 seconds so you will understand what it feels like. If you’re compulsive like some of my students, you’ll find yourself counting “one one-thousand, two one-thousand” and so on. I don’t care how you get there, just learn what it feels like. Then you won’t be so quick to move on to another subject after you’ve asked your closing questions.

Having the skill, courage and concentration to sit still and be silent for at least half a minute is the single most vital skill there is in selling. Practice this until you get a feel for how long 30 seconds is, and then it won’t be so nerve-wracking when big money is riding on how calm and quiet you remain in a real closing situation.

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