HOSPITALITY SALES MANAGMENT
HA- 400
P3, S5, T4
Obtaining Buyer Commitment
By Richard G. McNeill
April 6, 2000
Introduction
In Step # 4 of the Six-Step Sales Presentation, you "handled
customer objections" and answered all of their questions and concerns.
Finally, you think, I can ask for the order, sign the contract, close the
sale, or obtain buyer commitment to advance the sale further (all of these
terms refer to this step). Well, get ready for some surprises. Even though
the customer has agreed during Step # 4, they may object again at the close,
Step # 5
Step # 5 in the Six-Step
Sales Presentation
The closing stage in large and multi-call sales differs from the closing stage single-call sales. In single-call sales, closing asks for the order. In multi-call sales commitment from the customer can be expressed when the customer agrees to advance the buying process to the next stage (the next sales call). A successful close in the multi-call sale might be the customer’s agreement to bring a higher level decision-maker into the selling/buying negotiation—an advancement of the process. While the mechanics of transactional closing techniques (effective in single-call sales) are not always applicable to multi-call consultative selling, a well-rounded and developed salesperson knows these techniques and when and where to use them. The following describes these transactional selling techniques.
Closing a sale can be facilitated by some general guidelines. These should be accomplished during the presentation: (a) focus on dominant buying motives, (b) negotiate the tough points before attempting the close, (c) avoid surprises [new information] at the close, (d) do not isolate the prospect/customer during the sale [ensure that there has been two-way dialogue and involvement during the presentation], (e) display a high degree of self-confidence at the close, (f) ask for the order more than once [don’t give up if the buyer says, “no” the first time that you make a closing statement/question], and recognize closing clues during the presentation [prospect/customer may indicate verbal or non-verbal clues and you must be ready to Close at that point] (Manning & Reece, 1997).
Closing a sale can be facilitated by some specific methods. In preparing for your presentation in the Pre-Approach, it is advisable that you review the following closing methods and be prepared, if appropriate, to use one or all of them: (a) Trial Close, used at an opportune time during the presentation and when you perceive the prospect/customer is about to make a decision, (b) Summary of Benefits Close, used after you have presented the major benefits solving the customer’s needs and perceive his or her affirmative decision, (c) Assumption Close, used when you believe that there is a high probability of an affirmative decision, (d) Special Concession Close, gives the prospect/buyer something extra for acting immediately, (e) Negotiating the Single-Problem Close, used when there is resistance on a minor point and you move forward with a close attempt while simultaneously including a creative solution to the minor problem and resistance, (g) Limited Choice Close allows the prospect/customer several options and you to determine the relative degree of they buyer’s interest in each option; at the closing attempt, you then remove all options except those of high prospect/customer interest, and (h) Direct Appeal Close is simply asking for the order in a straightforward manner.
Confirming the sale occurs after the customer says, “yes.” The purpose is to reassure the customer by pointing out that he or she has made the correct decision. This step is important is addressing "post-purchase remorse” which is a common emotion following a purchase decision. In Relationship Selling, Closing the Sale is the beginning of a long-term relationship with the customer. Your reassurance will be helpful in maintaining and developing this relationship.
Using "Methods" to
1.0
METHOD
USED “DURING”
THE PRESENTATION (A "MINOR" CLOSE)
1.1
TRIAL
CLOSE
1.11 DEFINED: A minor closing attempt made at an opportune time during the sales presentation to encourage the customer to reveal readiness or unwillingness to buy.
1.12 WHEN USED: Most appropriate after obtaining sufficient agreements to buy AND getting “buying signals.”
1.13 EXAMPLE: After matching need with feature/benefit and confirmation, “Do you think your attendees will be happy with these junior suites?” “Would you like to formalize these arrangements?”
2.0
METHODS USED
“AFTER” THE PRESENTATION
& OVERCOMING OF OBJECTIONS. ("MAJOR" CLOSE)
2.1
SUMMARY-OF-THE
BENEFITS CLOSE
2.11 DEFINED: A reemphasis of the benefits that will help bring about a favorable decision. Summarizes the most important buyer benefits that will produce a favorable decision.
2.12 WHEN USED: The salesperson has overcome all objections and there are no more. Logical conclusion to the presentation.
2.13 EXAMPLE: “We can get the ball rolling by signing this letter of agreement.” A “DIRECT-APPEAL” CLOSE IS USED HERE.
2.2
ASSUMPTION CLOSE
2.21 DEFINED: An assumption that the prospect is going to buy. An assumption that the prospect has already bought the product.
2.22 WHEN USED: It comes near the end of the planned presentation after a genuine need has been identified, solutions/benefits have been presented, and objections have been handled satisfactorily.
2.23 EXAMPLE: Ask one or more questions regarding a minor point or begin writing up the order. “Shall I indicate “master billing” on the letter of agreement?”
2.3
SPECIAL-CONCESSION
CLOSE
2.31 DEFINED: Offers the buyer something extra for acting immediately.
2.32 WHEN USED: Use carefully because some buyers are skeptical of concessions. Use to “push-on-over” the prospect that seems to be on the edge of a decision.
2.33 EXAMPLE: Special price reduction, a more liberal credit plan, or an added feature that was not anticipated by the prospect. “As an added bonus, we can host (comp) your group’s reception party on the night of arrival.”
2.4
SINGLE-PROBLEM
CLOSE
2.41 DEFINED: A single objection that stands in the way of a close. You have already eliminated all objections but this one.
2.42 WHEN USED: It will generally surface on a “Trial Close.” Handle immediately when recognized.
2.43 EXAMPLE: “Mr. Prospect, it seems that you like all of the benefits that we have discussed except this one. Is that right? If I could take care of this, would you sign the letter of agreement?”
“Let’s review all of the superior benefits that you will have if you go with us: … “ Then Indirect Denial followed by one of 7 techniques to overcome objections.
2.5
LIMITED-CHOICE
CLOSE
2.51 DEFINED: A choice provided to the prospect as a way of “Qualifying” the prospect.
2.52 WHEN USED: After prospect seems unable to decide but you know that benefits have been “sold.” How to do:
(a) Allow prospect to examine several different “choice packages” and try to assess his/her degree of interest.
(b) Cease showing new choices when it appears that the prospect has been given ample selection.
(c) Remove product that the prospect does not seem genuinely interested in.
(d) Concentrate on products the prospect seems to be definitely interested in.
2.53 EXAMPLE: “It appears that these two choices are your primary interest. Is that right? The pluses and minuses of each are these: Which one would you like?”
2.6
DIRECT-APPEAL
CLOSE
2.61 DEFINED: Asking for the order in a straightforward manner.
2.62 WHEN USED: After all benefits have been presented and agreed to. Don’t use too early.
2.63 EXAMPLE: “Can we formalize our agreement with your signature on this letter of agreement?” Can I send you the letter of agreement?”
Example of Three Attempts to Close
These
three attempts occur after the customer's objections (Step # 4) have been
answered. In fact, Rich has made a good presentation up until this point and
believes that Erin is ready to buy
“SUMMARY-OF-THE-BENEFITS CLOSE” (RICH TRIES FOR 1ST CLOSE)
(Reason to summarize: You want “benefits” in the front of Erin’s mind just before “closing the sale”. Make this summary loose and free flowing.)
RICH: I’m happy to hear that. Erin, let’s briefly review where we’ve been: We have your dates available (# 1) and we have provided you spacious meeting accommodations for both the meeting and trade show (#2). Our oversized and newly renovated sleeping rooms provide comfortable accommodations for your seminar presenters (# 3). The chicken luncheon prepared by our award winning chef will be artistically presented and deliciously prepared (# 4). Easy access to our downtown location and our free adjacent parking garage will provide your guests convenience (# 5). And, most importantly, all of this is within your budget range (# 6).
(After hearing a buying signal or reading body language for the signal. Also note that Erin’s questions [her objections] have all been addressed)
RICH: “Can we formalize our agreement to host your meeting by signing this understanding document (contract)? (place proposal in front of Erin with a pen)?
ERIN: Well, Rich, even though you can give me free airport transportation and this saves me $400 and helps me get within my budget, I can get the same free transport at the Marriott. I need a better price. What can you do?
“SPECIAL-CONCESSION CLOSE” (RICH TRIES FOR 2ND CLOSE)
RICH: Erin, I understand your need to obtain the best cost/value for you meeting. I have a tough time reducing the rates much further. Tell you what, you indicated that this meeting was the first of a series and you needed it to have a “special feel.”(Customer Need). As an added bonus, we can host (comp) a special reception party for your 40 seminar leaders on the night of arrival (Feature). What this means to you (translation statement) is that they will feel especially taken care of and I’m asure that positive word will get around about how you and the YWCA handles meetings (translation of features into benefits). How does this sound (Confirmation and trial close attempt)?
NOTE: Rich uses a “need” (assume that Erin had mentioned a potenial need for a reception, but knew it was out of her budget)that he heard earlier but which was not a part of the formal presentation and then uses a standard “matching of needs with product benefit statement.”
ERIN: That would be wonderful and would really add to the tone of the meeting, but I wasn’t planning on a reception. It would be nice though. Rich, I really need a lower price.
“SINGLE-PROBLEM CLOSE” (RICH TRIES FOR 3rd CLOSE)
RICH: Erin, what I hear you saying is that you absolutely need the charges on this proposal to exactly total $10,000, is that right?
ERIN: That’s right.
RICH: Erin, it seems that you like all of the benefits that we have discussed except the total price. If I can get this number to $10,000, can I have your commitment to meet at the Hyatt Regency Phoenix Hotel.
ERIN: Yes.
RICH: Here’s what I can do. I am authorized to reduce the sleeping rooms by another $10 per night. For 40 rooms this is another $400 savings in addition to the savings on airport transportatio (feature). This means to you (translation statement) that the original proposal of $10,800 will be reduced to meet your budget of $10,000 (benefit). How does this sound (confirmation and trial close)?
ERIN: This sounds great!
RICH: “Can we formalize our agreement to host your meeting by signing this understanding document (contract)? (place proposal in front of Erin with a pen)?
ERIN: Rich, I’m looking forward to doing business with you. (Signing the letter of agreement) What happens next?
Servicing the “Closed” Sale
RICH: Erin, we at the Hyatt Regency Phoenix Hotel want to make your meeting a very successful one. As soon as you sign the letter of agreement, this becomes the “marching orders of the house” (the hotel). We will immediately assign you a “Conference Coordinator” who will call and introduce themselves and let you know about various timelines and things needed to detail the meeting.
Of course, I am always in the background and watching over your meeting to make sure that everything runs smoothly.
ERIN: This sounds great. Having a person to help me with my meeting sure takes a load off my mind. Rich, it’s been great working with you.
RICH: Erin, I am enjoying working with you and helping you to have a successful meeting. I appreciate your time and look forward to working with you. Thanks again for your business.
Summary
Customer concerns are welcomed by successful salespeople. When they occur it is an indication that the customer is engaged in the sales presentation. In short, they are interested. Customers have concerns DURING the presentation (Step #4 of the Six-Step Selling Process) where the salesperson must negotiate resistance. Customers also have concerns AT THE END of the presentation (Step # 5) when the salesperson attempts to obtain commitment. In essence, both types of concerns must be effectively negotiated (answered) by the salesperson. If a customer makes a purchase under the duress or pressure of a salesperson, but still has concerns (unresolved), you can bet that this customer will probably be unsatisfied. They will probably not make a repeat purchase and certainly won't refer the salesperson. In fact, they may even spread bad reports about this sale.
Salespeople should be careful to fully answer all customer questions regarding their concerns. In fact, the successful salesperson will actually ask many probing questions to make sure that the customer really does understand the solution and is comfortable with it. Unsuccessful salespeople accept the first tentative “yes” or any sign of agreement from the customer. They delude themselves in believing that the customer is in agreement when they really are not. The problem? When the salesperson asks for the order, the unresolved problem usually resurfaces or the customer simply says “no.”
The above ways of handling or responding to customer’s objections are only a starting point. They offer the beginning salesperson a model to use in responding. Of course, with experience, salespeople develop their own comfort level and individual ways of responding.
Make no mistake, customers almost always raise some concerns. Prepare before the sales presentation by anticipating the possible objections you might encounter. Then during the sales presentation expect the unexpected and be ready to think on your feet. However, with preparation of potential responses and armed with a guide to structuring your answer, you will be far more skilled than most salespeople who simply “wing-it.”
References
Manning, Gerald, L. & Reece, Barry L. (1997). Selling Today (7th Ed.).
Upper Saddle River, NJ: Prentice Hall.
Copyright ©2000 by Richard G. McNeill
ALL RIGHTS RESERVED