On this episode, Paul explores the indicators of buyer bluffing.
Salespeople cave-in to price objections 75% of the time.
“If [the customer] has demonstrated a willingness to buy, then they give you a price objection, they are bluffing.
“Anything that mitigates the importance of price is a pressure point.”
Do you know when your customer is bluffing?
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How do I know when the buyer is bluffing?
(Transcribed from podcast)
Today, we have a great question. This question actually came from a live sales training program that I did with one of my clients down in Florida. Yes—live event. You heard me. Not virtual. And the salesperson had a great question, and it came up right at one of our breaks, so we didn’t have enough time to get into it. The question was: How do you know if the customer is bluffing? How do you know if that buyer is bluffing? Wouldn’t you love to know that information? As salespeople, we’re constantly wondering, “Okay. Are they really giving me a price objection, or, or is it just fake or what is it? How do I know? Oh, if I don’t cave in, though, I’m going to lose the business.” We all know that we’ve experienced it. Well, I’m going to give you some tips on today’s episode.
Before we get into that, a quick shout-out to Andrea over at The Creative Impostor Studios. You hear me say every week, Andrea and her team do an absolutely wonderful job. If you need some help launching your podcast, Andrea is your go-to resource. Reach out to her and her team, The Creative Impostor Studios. We’re going to have a link to her website on this episode’s web page. And even if you’re contemplating a podcast, she helps a wide variety of podcasters so she can help you.
Also, pick up your copy of Value-Added Selling. In Value-Added Selling, we talk about some of the techniques actually on today’s show. We have much more depth in the book. Pick up your copy on Amazon. I think it’s selling for about $25-$30 right now. It’s a small investment to make. In your sales future. So, pick up your copy today.
Let’s get back to that question. How do you know if the buyer is bluffing? Well, first of all, your customers know that if they make you feel just a little bit of pressure, there’s a good chance you’re going to discount. Research has shown this. In fact, our internal research, which we have tracked now for almost 40 years, shows that when salespeople are given a price objection, 75 percent of the time, they are going to cave in and give some sort of concession. So, the buyer has to be thinking, “Okay. Why wouldn’t I? Why wouldn’t I ask for that discount?” Buyers know this. So, our goal is to really understand if that buyer is bluffing or not.
Number one—here’s how you know if they are bluffing. If they have already demonstrated willingness to buy and then they give you a price objection, they are bluffing. Think about this. Let’s say you’re interacting with the customer and they’ve given you verbal agreement. They’ve said things like, “Yeah, you know what? Your solution looks great.” And they know what the price is, and they know what they’re going to have to invest. And they tell you constantly, “Yeah, this looks good. It’s a good fit. Everyone’s on board with it. It seems like the right decision.” If they start giving you all of these indicators and then all of a sudden, they say, “Your price is too high,” there’s a good chance they’re bluffing. They’re just fishing. They’re trying to see if they can get a discount or not. Because experience has taught them that when they do ask for discount, they get it 75 percent of the time.
Here’s one great example. I remember when I was selling tools and fasteners and I was down at our store, and a customer came in. This customer was trying out one of our tools that I was selling at the time. And he gave every buying signal you could imagine. I mean, the guy even tried to put the tool in his truck to see if it would fit. He wasn’t trying to steal it. He just wanted to see if it would fit the tool case and all that. So, this guy was giving every buying signal.
Then, he asked the price. Then he said, “Okay, you know, let me think about that for a moment or two. Let me see if we’ve got that in our budget.” And while he’s doing this, he actually gets his credit card out and he’s tapping the counter with it, with this credit card. And he says, “You know what? That price just seems a little too high. Can you guys knock off like 10 percent?” That guy was playing a game. He didn’t need that 10 percent discount. He had his credit card out and he was ready to buy. That’s an example of when you know that customer is bluffing.
Let’s look at the next example. Let’s say you’ve been working on an opportunity. Maybe it’s weeks, maybe it’s months, whatever it might be. You’re building rapport. You’re gaining buy-in with a lot of decision makers. You present your solution, you present your price, and at that point, when you present your price, the buyer says, “Okay, well, there’s another competitor, another option that we’re looking at.” They haven’t mentioned this competitor or the other alternative throughout the entire process. And now, once you start talking about price and they’re ready to move forward, now a competitor shows up. I’m going to guarantee you that they are playing a game. Especially if they’re being secretive. If you’re asking questions about this competitor,
“Okay. Well tell me a little bit about their solution.”
“Oh, I don’t want to, really. I don’t want to give you too much information,” or “I don’t want to share that kind of information.”
If they’re being secretive about the competitor, I can guarantee you that this is a ploy. It’s a game on their part to try to drive down pricing. So be prepared for that. Again. If they’re bringing in a new competitor at the last minute, there’s a good chance that they are bluffing.
Point number three: If the customer’s feeling more pressure to buy it than you’re feeling to sell it, there’s a good chance they’re bluffing. We call this pressure points. We’ve talked about pressure points on previous podcasts. A pressure point is anything that mitigates the importance of price. So, for example, if the buyer has a short timeline, they have to get this done. Let’s say they have a preference to work with your company. Let’s say you’re selling an exclusive product that nobody else can buy. And let’s say there’s a high switch-out cost if they decide to switch providers. Let’s go further and say, let’s say they’re facing a unique problem and you have a unique solution. If any of these pressure points are at play, there’s a good chance that they’re bluffing. Because, when buyers know that they’re feeling pressure, they try to balance that out.
They might try to make you think they can go somewhere else but look at the facts. Look at the pressure points that are there. If the buyer’s feeling more pressure to buy from you, there’s a good chance that they are bluffing. Make the buyer aware of that pressure. You know, as I mentioned, in Value-Added Selling, we have a complete list of pressure points and how to use them. It’s in our chapter on Customer-izing. So, if you have the book already, check out that chapter. If you need to get your copy, you know where to go. Go to Amazon, Barnes and Noble, wherever. But those pressure points, if you can highlight those pressure points, it’s going to take the focus off of price.
Point number four, this is my favorite. We had a salesperson in one of our training seminars, and we were talking about bluffing and what customers will do and all that. And he said, “Oh, I’ve got a great response for anytime I get a price objection.” And this is a very brash, bold salesperson. Man, I’d love to be a fly on the wall of one of his sales calls. Here’s what he said.
He goes, “Whenever I get a price objection, I simply ask the customer ‘Why?’” So, think about this for a moment.
Let’s say you present your solution: “Our solution is $100,000,” and the customer says, “Oh, that price is too high. Can I get a discount?”
“Why? Why should you get a discount?”
Now think about that. And he said, “You know, sometimes the buyer would give him a legitimate response. But if they couldn’t give a legitimate response, if they would just say things like, ‘Well, you know, it just seems, I think we should get a discount’ or, ‘I think I should get the good-buyer discount, or a volume discount,’ or they have no good reasoning behind it,” he said, “it’s a bluff. They’re just bluffing me. They’re just playing games to see if they can get a cheaper price.”
So, you’ve got to decide. The question again was “How do you know if the buyer is bluffing or not?” I give you a couple of things to think about, but you are the one that ultimately has to make that choice, whether you are going to hold the line or not. Now my hunch is to hold the line. It’s always been that way. And I’ve experienced instances where I’ve won business and I’ve lost business because I held the line on pricing. And that’s not always a bad thing. Remember if you’re not losing a certain percentage of your deals because of price, then you’re not charging enough for what you sell.
All right, guys. That is the show for today. Again, the four tips—number one: if they already demonstrated they’re willing to buy, they might be bluffing. Number two: if they bring in a new competitor at the last minute, they’re probably bluffing. Number three: if they’re feeling pressure to buy from you, they’re probably bluffing. And number four: if they give no explanation as to why they need a discount, then they’re bluffing.
Make it a big day.