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How I Handle "The Negotiator" Customers

Finally at the end of your long sales process and as you go for the close, the customer is stuck on the price. You really need to close this deal but he is obviously fishing for a discount. What do you do? Here's some ways to help handle customers that have declared themselves professional negotiators.

You could ask your manager for a special discount just for him, but if you work on margins you might as well give that customer part of your check. What if the discount isn't good enough to close? Now he knows you willing to drop the price and will likely spend the most amount of time possible trying to get every last dollar back. Say goodbye to any profit margins if you go that route.

Now this isn't every case, some people are looking for a quick 5%, a t-shirt, or something to make them feel like they won the deal against the salesperson. There is a much better way to not only close the sale but to ensure future business, referrals, and maintain your margins through bulk deals. (The best strategy is at the end)

First up is Bulk Deals. This one is pretty simple because it does offer a discount but ensures you are getting either more upfront commitment or larger purchase order. For a monthly subscription service, you can offer an annual or semi-annual renewal. The customer can save 10-15% but now you have a much larger amount of capital upfront that you can immediately use to scale your business.

This is huge as a business because growth requires marketing and marketing can get expensive. Think of it this way. You have 10 customers that pay monthly. (hopefully more than that but we'll keep numbers small for now) So every month priced at $100/mo you get $1,000. What if we took those 10 customers and offered them the chance to pay $1000, for the year and save $200 total annually. Seems like a no brainer if they can afford it right. Now that first month you are going to clear $10,000 and you can put a significant amount more money back into your business. If you can't pick up 10 subscriptions with $10,000/mo in ad spend (even bad ads) you need to reevaluate your business.

If you have physical products, you can have a discount if they spend a certain amount. When I used this selling car parts I always had the authority to discount at any level. Instead of offering that discount, I would make it seem like a special bonus if they purchased the item they were on the fence about. They want to buy a set of coilovers but were on the fence about lower control arms, I would tell them if they bought both together today, I'll just knock 10%. (sorry if you don't understand cars.) Sometimes all I had to do is offer a free t-shirt and some stickers. But it is a powerful tool to get more out of each sale without pushing them into something they don't need.

Another option I always like is the "Next Purchase Discount". This is good for same day closes as well. "If you sign up today, I'll give an extra 10% off the subscription when you renew next year. I always think of repeat business as free money. All you have to do is honor a 10% discount and you'll get another year of business. No additional customer acquisition cost, just free money.

The biggest benefit to this one is that you get your full value close up front, and then a discounted renewal which again is just free money.

Referrals. I could speaks for days straight on the value of referrals but there are so many businesses that don't have referral program. So Mr. Negotiator says he needs at least one month free to buy. You could just say okay, write up the deal and move on. That's the easy way but let's turn this customer into a marketing machine and have him earn his discount.

Instead of just giving the month free and closing the deal, how about every customer he refers will give him a benefit. If his referral pays for an annual subscription he'll get 2 months free. He can pay for his whole year by just getting 6 new customers. Don't think of it as a customer getting a free year. Think of the fact that you now have 6 paid customers that cost you nothing. You a referral program that actual rewards the customer but make sure it doesn't pay any benefits until your business benefits first. Referrals are great but you only want to reward the ones that buy. Otherwise your sales reps will be tied up all day by random friends trying to help their buddy save some money. So make sure the program only rewards on purchases/subscriptions. Make sure its the kind you want as well.

Side note on the referrals. For higher priced subscriptions or products this is a great way to have trust with those future 6 customers. More trust means the easier it will be to sell a higher priced package. (Only if it fits what they want and need. No unethical sales)

So there are plenty of ways to give a discount without first getting more money on the deal. Sure you can take the 5% hit and move on. You are missing out on a lot of potential profits though.

Last and most important is Value Based Selling. Your customer came to you for a certain reason. They have some kind of pain point and if you made it all the way to the close, you're business must offer a solution to it. This is a skill set that requires development in your sales people. Selling with value requires asking the right questions, remembering that information and using it to overturn objections. Staying on course to show that your product solves (or improves) the problem they were looking to solve. When you become skilled in building value, the customer will find it as a no brainer to buy.

While I do spend a lot of time working with Bulk deals, Referrals, and Next Purchase Discount strategies, Value Based Selling is hands down the most effective tool for dealing with "The Negotiator". This is all covered in our Sales Accelerator Program. We also have a wide range of services we offer to help you navigate the difficulties in the sales environment. Feel free to go to the Contact Page and ask how we can help.

Until then, feel free to subscribe to the newsletter and keep up to date with new strategies and insights. We have plenty more to come.

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