Risk and Reward
By Reed Sawyer
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Since the fear of pain is always greater than the desire for gain, eliminating risks or minimizing risks is a more effective sales tool than emphasizing rewards. In other words, you must acknowledge the risks, address them, and minimize them before you tell about the benefits.
How do we do that?
1) Realize that there are always subconscious fears that lurk underneath the surface in a sales presentation. If you can bring those out, and eliminate them by giving information and asking questions, you can remove the risks.
a) You can’t tell someone that there are no risks. Instead, bring out the most commonly perceived risks and ask questions to impart information and the client will remove those risks. (If I tell you something, it might be a lie. If you tell me, it is always the truth, according to you. Let them be the truth teller here and have them eliminate the risks by answering your questions.)
Here is an example: By using a vacation club membership, you can save multiple thousands of dollars over the course of your membership. What are the perceived risks? It might be out of business in a year. State that it has had the same address and phone number for the last 30 years, and ask the client if they feel comfortable with a business that has kept the same phone number and address for 30 years? Is that an indication that they are stable? Does that indicate that they will be around for a long time, if they have been around for a long time already?
By giving a factual statement, and then asking the client to interpret that, you are having them validate the truth. If they say that they feel very comfortable with the fact that it has had the same address and phone number for 30 years, you have eliminated that nagging doubt. After all, they said it, so it must be true.
2) Ask if there are any other concerns? If you do this in a sympathetic manner, they will not feel that you are using high pressure tactics, but that you are trying to help them be an informed consumer. If there are no other concerns, try a trial close. “Are there any other concerns that would stop you from taking action today?” Then…shut up and listen. If you keep talking they will use your talking to stall. If you shut up, they will answer, hopefully with another objection. If they don’t have any objections, you will then need to discern if they are ready to proceed, or if your benefits are large enough to overcome their buying process objection (no one wants to be sold, but everyone wants to buy.)
3) If they raise an objection, simply do the backtrack, conditional close technique. Use their exact words of their objection, (“the price is too high”) and phrase it in the form of a question, “So, the price is too high? Assuming we can deal with that, are there any other objections?” Since most people have a processorial objection to any closing, they might have just thrown out an objection without thinking of it. By using their exact words, in the form of a question, they are hearing their own voice raise the objection. If it sounds silly to them, you can just go past it and move on. You haven’t lowered the price, you have handled the objection. If price really is the objection, raise the benefits, do not lower the price. This is a conditional close opportunity, and you can move forward with it.
By getting the risks taken care of first, you eliminate that fear, and allow the benefits to be larger than the costs. If you don’t manage the risks, they will be unsettling and cause a lost sale.
Risk reversal:
Risk reversal is taking the risk out of the equation for the buyer, so that there is NO risk to him, and all of the risk is assumed by you.
Example: "You must experience 100% satisfaction with this mattress, or we will give you back your money, and give you $20 for your trouble."
Why would you do a risk reversal, (Get Jay Abraham's book, "Getting Everything you can out of all you've got" for more information)? To completely remove the risk from the buyer so that there is no reason for them to not purchase.
Are there other risk reversal techniques?
What about: "If you are not satisfied within the first two weeks, return this item to the store for a full refund."
"You will experience a 20% improvement in your sex life after trying these pills, or you can return the unused portion and get all of your money back."
"This will be the best listening experience you have ever had in a portable sound system, or you can return it within 30 days and get a complete refund."
What you are doing is letting the buyer know that they don't have anything to lose. They have no risk. Now, if you have a great product, you will always have some people that return it, no matter how great the product is; however, since your volume will be increased so much, it is worth it for the small returns that you will have.
If you have a terrible product, and you know that it will make people unhappy, a risk reversal technique is a terrible idea, because people will demand their money back, and/or put you out of business.
By Reed Sawyer
Since the fear of pain is always greater than the desire for gain, eliminating risks or minimizing risks is a more effective sales tool than emphasizing rewards. In other words, you must acknowledge the risks, address them, and minimize them before you tell about the benefits.
How do we do that?
1) Realize that there are always subconscious fears that lurk underneath the surface in a sales presentation. If you can bring those out, and eliminate them by giving information and asking questions, you can remove the risks.
a) You can’t tell someone that there are no risks. Instead, bring out the most commonly perceived risks and ask questions to impart information and the client will remove those risks. (If I tell you something, it might be a lie. If you tell me, it is always the truth, according to you. Let them be the truth teller here and have them eliminate the risks by answering your questions.)
Here is an example: By using a vacation club membership, you can save multiple thousands of dollars over the course of your membership. What are the perceived risks? It might be out of business in a year. State that it has had the same address and phone number for the last 30 years, and ask the client if they feel comfortable with a business that has kept the same phone number and address for 30 years? Is that an indication that they are stable? Does that indicate that they will be around for a long time, if they have been around for a long time already?
By giving a factual statement, and then asking the client to interpret that, you are having them validate the truth. If they say that they feel very comfortable with the fact that it has had the same address and phone number for 30 years, you have eliminated that nagging doubt. After all, they said it, so it must be true.
2) Ask if there are any other concerns? If you do this in a sympathetic manner, they will not feel that you are using high pressure tactics, but that you are trying to help them be an informed consumer. If there are no other concerns, try a trial close. “Are there any other concerns that would stop you from taking action today?” Then…shut up and listen. If you keep talking they will use your talking to stall. If you shut up, they will answer, hopefully with another objection. If they don’t have any objections, you will then need to discern if they are ready to proceed, or if your benefits are large enough to overcome their buying process objection (no one wants to be sold, but everyone wants to buy.)
3) If they raise an objection, simply do the backtrack, conditional close technique. Use their exact words of their objection, (“the price is too high”) and phrase it in the form of a question, “So, the price is too high? Assuming we can deal with that, are there any other objections?” Since most people have a processorial objection to any closing, they might have just thrown out an objection without thinking of it. By using their exact words, in the form of a question, they are hearing their own voice raise the objection. If it sounds silly to them, you can just go past it and move on. You haven’t lowered the price, you have handled the objection. If price really is the objection, raise the benefits, do not lower the price. This is a conditional close opportunity, and you can move forward with it.
By getting the risks taken care of first, you eliminate that fear, and allow the benefits to be larger than the costs. If you don’t manage the risks, they will be unsettling and cause a lost sale.
Risk reversal:
Risk reversal is taking the risk out of the equation for the buyer, so that there is NO risk to him, and all of the risk is assumed by you.
Example: "You must experience 100% satisfaction with this mattress, or we will give you back your money, and give you $20 for your trouble."
Why would you do a risk reversal, (Get Jay Abraham's book, "Getting Everything you can out of all you've got" for more information)? To completely remove the risk from the buyer so that there is no reason for them to not purchase.
Are there other risk reversal techniques?
What about: "If you are not satisfied within the first two weeks, return this item to the store for a full refund."
"You will experience a 20% improvement in your sex life after trying these pills, or you can return the unused portion and get all of your money back."
"This will be the best listening experience you have ever had in a portable sound system, or you can return it within 30 days and get a complete refund."
What you are doing is letting the buyer know that they don't have anything to lose. They have no risk. Now, if you have a great product, you will always have some people that return it, no matter how great the product is; however, since your volume will be increased so much, it is worth it for the small returns that you will have.
If you have a terrible product, and you know that it will make people unhappy, a risk reversal technique is a terrible idea, because people will demand their money back, and/or put you out of business.
