Monday, March 24, 2008

5 rules of closing

Closing Rule #1: Think Like a Closer.

We’re going to spend this week on a key skill: how to close. The last time we touched on this subject, I pointed out the many problems with manipulative “trick closes,” so I’m not going to go over that material again. Instead, I’m going to present a series of inviolable “rules” for closing, based largely upon several conversations that I’ve had on the subject with the guru of closing, Linda Richardson, leavened (as usual) with my personal experience. So let’s get started.

The best way to learn something quickly is to emulate the thought processes and behaviors of somebody who’s already good at what you want to learn. That’s why people who want to learn to play tennis well study the attitudes and behaviors of tennis stars. It’s why aspiring actors have a fascination with those who are already successful in that field. It’s easier to walk in the footsteps of giants than to blaze a trail of your own. So:

Rule #1: Think Like a Closer. According to Richardson, the great “closers” in this world share two characteristics: they’re incredibly prompt and incredibly persistent. If they get a lead, they’re on that lead immediately. If they sense the time is right, they close the deal, right then and there. After they’ve closed, they always follow up immediately. So if you want to be a better closer, you’ve got to torque up your behavior so that you’re on top of things.

If you aren’t willing to be vigilant and inexhaustible in your focus and your ability to understand customer needs, you’ll never be a great closer. If you aren’t willing to constantly improve your skills at dialog and questioning, you’ll never be a great closer. If you aren’t willing to do the extra mental work to build confidence in your own ability, you’ll never be a great closer.

That’s the foundation. Over the next few days, we’ll be looking at strategies and techniques that will help you close more business more quickly, so stay tuned.

If you think you have what it takes to be a great closer, hit the “thumbs up” button at the top of the page.

Closing Rule #2: Set an Objective.

Myth: Every sale has a single, all-important point where the deal closes. Truth: Some extremely simple sales processes have a defined close point, but complex sales processes (i.e. almost all B2B sales) have a series of points where the prospect makes a decision, even if it’s just the decision to let you pitch, rather than pitch you out. According to closing guru Linda Richardson all sales go through four phases, each with its own type of close:

  1. Initial. The “close” is moving from a cold-call into the sale cycle.
  2. Developmental. The “close” is gathering information to define a solution.
  3. Culmination. The “close” is the asking for the next step or for the business.
  4. Follow-up. The “close” is ensuring that the relationship goes forward.

Your job is to make certain that all those “closes” take place in a timely manner. Therefore:

Rule #2. Set an Objective for Each Meeting. At every point in the sales process, you should always have a closing objective that is specific, measurable and appropriately aggressive. I’m not talking about crunchy granola, touchy-feely goals like “get closer to the customer” or “learn about customer needs.” Yeah, you need to do those things, but those are processes, not goals. Goals are specific and measurable, like:

  • I will get a list of the key decision-makers.
  • I will get a copy of the competitor’s proposal.
  • I will obtain a working description of the customer’s problem.
  • I will get first access to my customer contact’s boss.

And, of course, eventually:

  • I will ask for the business.

Richardson says that your closing objective should be aggressive, but appropriate to the stage of the sales cycle. For example, setting a goal to “ask for the business” on the first sales call for a million-dollar deal is probably setting yourself up to fail. This isn’t to say that you can’t be flexible and ask for the business on those rare opportunities where a deal gets fast-tracked. But you should always have a “stretch” objective for every sales meeting and make your best effort to close on that objective.

By the way, the incredible advantage of treating the sales cycle as series of closes is that the approach makes it easier and more natural to ask for the business, when it’s time to achieve that particular objective. More on this tomorrow.

Closing Rule #3: Overcome Your Fear.

Closing is simple. What’s difficult is dealing with the negative emotions that you’re having about closing. Those emotions include.

  • Fear of failure. If I lose this sale, it means that I’m a failure as a sales professional.
  • Fear of rejection. If I lose this sale, it means that the customer doesn’t like me.
  • Fear of financial loss. If I lose this sale, I won’t make the commission and my kids won’t eat.
  • Fear of management disapproval. If I don’t make quota, my boss will be unhappy.
  • Fear of lost anticipation. If I don’t make the sale, I’ll lose the pleasant fantasy of winning.
  • Fear of social blundering. If I ask at the wrong time, the customer will think I’m pushy.

The unifying factor in all these emotions, of course, is fear. The specific quality of that fear differs from person to person. Some folk don’t care that much about social rejection , for example, but hate, hate, hate to lose a commission. Other folk are happy to take a financial loss as long as they don’t have look like a fool in front of a customer. However, regardless of the particular size and shape of your fears, the solution is the same:

Rule #3. Overcome Your Fear. Regardless of how uncomfortable you are or how terrible you might feel if your close doesn’t result in a sale, the truth is that YOU HAVE TO CLOSE. It’s part of the job, no matter how much it’s scaring you. So just do it, dammit.

Closing is like standing on the edge of a cold swimming pool. Slowly lowering yourself in the water is slow torture; better to just take a deep breath and jump.

Or, to use another analogy, closing is like walking across a bed of hot coals. (I actually did this at a sales seminar.) If you walk quickly you’ll be fine, but if you dawdle you’ll end up with a couple of size 11 blisters.

Now, that doesn’t mean that you should gird up your loins and blurt out “so how about it?” ten minutes into the first meeting. Effective closing is all about timing, which is what we’ll be discussing tomorrow.

How to Overcome Fear.

I was going to write about the “timing” aspect of closing deals. but it occurred to me that talking about timing would just so much jabber-jawin’ if I don’t provide some tools to overcome the fear of closing.

I’m well aware that experienced sales pros seldom have a debilitating fear of closing. However, that fear is a major problem for novices and a common reason for a lack of success at sales. And even experienced sales pros sometimes clutch when they’re working on a deal that’s larger than their zone of comfort.

More importantly, the ability to overcome irrational fear is a major enhancement to the quality of life. All in all, I think that taking care of that fear — forever — is worth a one-day pause in the “rules of closing” discussion. So here goes:

How do you overcome a fear? Here are five basic techniques:

  • Familiarity. The more you close, the easier it is to close. That’s why I recommended that you treat the sales cycle as a series of small closes. That way closing on the big deal isn’t a big deal in and of itself.
  • Rehearsal. When it comes to emotions, your brain can’t differentiate between what it imagines and what’s actually happened in the real world. If you repeatedly rehearse closing in your mind, and while rehearsing force yourself to feel confident, your behavior in the real world will imitate your imagination.
  • Reframing. This entails creating a comparison that makes the original fear seem trivial. Example: There are millions of Iraqi citizens who have to worry about being shot simply if they go to the store to buy some food, so what have you got to be afraid of?
  • Association. Ever been to an amusement park? If so, you probably paid $30 to $50 to be frightened. The “fear” part of selling is like going on a rollercoaster — except that you get to some steering, so you’re more in control. So the “fear” is the exciting part of selling, right?
  • Redefinition — Fear is actually just a signal that you need to do something. If you’re afraid to ask for the business, it’s just your subconscious mind telling you that it’s getting close to the point where you need to ask for the business.

Put these techniques in your mental “bag of tricks” and fear of failure or rejection will be unable to hold you back any longer. The techniques are best applied in combination. For example, here’s the specific routine that works for me:

  1. I notice that I’m putting something off because of a fear that it won’t happen.
  2. I re-confirm that the goal is worth pursuing.
  3. I “remember” that the fear is just a signal that this is a desirable goal.
  4. I feel grateful that I have the opportunity to achieve that goal.
  5. I briefly think about all the things that I don’t have to be afraid about.
  6. I recall all the times that I’ve overcome similar fears.
  7. I imagine myself taking the action that I’ve been putting off because of fear.
  8. I repeat the above step 5 times, visualizing a successful outcome.
  9. I use the momentum of all of the above to push me forward.

The above formula has allowed me, a relatively quiet guy, to pursue some goals and have some experiences that otherwise would have been completely impossible for me to achieve. And it’s certainly taken away any fear I ever had of closing a deal. Try it!

Closing Rule #4: Always Be Checking

When it comes to closing, timing is everything. And that leads us to:

Rule #4. Always Be Checking. The best way to know when it’s time to close, according to closing guru Linda Richardson, is to return the old ABC adage from “Always Be Closing” to “Always Be Checking.” The idea is to constantly get feedback from the prospect about whether it’s safe to close. That way, when you do close, it becomes less of a “moment of truth” and more like a natural extension of the conversation that you’re having with the prospect.

At convenient points during the sales call (after you have positioned your message, responded to an objection, answered a question, etc.) ask a question that draws out more information and which reveals the prospects state of mind relative to the progress of the sale. Nothing elaborate, just normal conversational stuff like:

  • How does that sound?
  • How would that work?
  • What do you think about…?

Asking for feedback not only give you critical information about the prospect’s problems and potential to accept your solution, but also increases your confidence when it comes to asking for the business or the next step.

When you’re checking, avoid leading questions like “Does that make sense to you?” or “Do you agree?” while nodding your head. Prospects will almost always respond to such questions by nodding along with you, without really agreeing. Instead, ask questions that encourage the prospect to provide you with vital information. Example:

Rep (nodding): “We have the best framistat in the business. Do you agree?”
Prospect (nodding back): “Uh huh.” (Thinking: “Yeah, I hear you.”)

Rep: “Do you think our service program could satisfy your needs?
Prospect: “We need a global deployment for service.”
Rep: “I can see why that’s important. We have international partners who deliver our services. How would that meet your concern?”

According to Richardson, the best part about “always be checking” is that half the time the client will say preemptively close the sale for you by saying something like “So, when do we start?”

On Monday, I’ll explain the exact mechanics of how to close. You’ll want to read that post first thing in the morning, because it’s going to increase your closure rate for entire week… and beyond.

Important: Click the “thumbs up” symbol at the top of the post if you’re committed to becoming a great “closer.”

Finally: How to Close!

The old “Always Be Closing” philosophy is often misinterpreted to mean hammering the customer until the customer buys. That’s too bad, because that interpretation of the ABC strategy creates a sense of overwhelming pressure. And that inevitably creates resistance to the sale because the prospect doesn’t want to feel that he or she is being manipulated or conned.

This isn’t to say that high pressure sales tactics don’t work sometimes. They can, and do. Otherwise sales pros wouldn’t use them. Most of the time, though, high pressure tactics backfire, even when they “work.” But most B2B sales involve a long-term relationship between two firms, so if you make a high pressure sale, chances are you’ve made your customer contact feel like a fool, and you’ll be persona non grata next time you need some business. And that leads us to:

Rule #5: Close with Confidence. If you’ve been following the rules from the previous post, you’ve used checking to get feedback and to position your offerings. If so, you should be able to sense the rhythm of the conversation and whether the customer is ready to make a decision. That’s when you close. Closing guru Linda Richardson describes this as a five step process:

  1. Summarize. Make a concise, powerful summary that reiterates the benefits of your offerings and its appropriateness for the prospect. Speak with confidence, but don’t let your voice slip into “sales pitch-eese.” Keep it conversational.
  2. Final Check. Once you’ve summarized, do one final check - not for understanding but for agreement. Example: “I think we’ve pretty much concluded that our solution will solve your problem and save you money; how does that meet your objective?” Don’t be pushy and don’t ask a leading question like: “Do you agree?” This final check gives the customer the opportunity to surface any final objections that might interfere with the close.
  3. Ask for the Business. If the final check doesn’t surface a new objection, be direct and ask for the business — confidently and clearly. Example: “Will you give us the go-ahead?”
  4. Conclude with Confidence. Chances are you just made a sale, in which case it should be easy to conclude the meeting with confidence, energy, and rapport. But even if you didn’t get the sale, you want to leave the (almost) customer with the sense that you are a person with whom they want to do business. So thank the prospect and state your desire to work with the client in the future.
  5. Follow up Immediately. This is where many reps stumble. They’re so elated at getting the business that they think the job is done and don’t take the necessary steps to make sure that the deal is executed and that the customer remains happy.

It’s really that simple. The most elegant thing about the above sequence is that it builds on the previous four rules.

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