Are you closing as many sales as you should be? If not, better read on.
Let’s assume your marketing is pulling in shoppers. Shoppers are people who claim to want more information before deciding whether or not to buy.
We should set a benchmark before moving ahead. If you sell everyone who asks for more information, something is seriously wrong with your sales structure. Wrong? Yes, wrong. If you sell everyone, your price is too low and you are missing margin.
Think about this example. If you put your home on the market and the realtor sells it in a day, that’s great, right? No. It means your price was too low. If a realtor boasts about selling homes in less time on average than any other realtor in the area, it means that realtor is under selling.
A sale that is too easy to make has a flaw—somewhere. Either the price is too low or there is something odd about the buyer. Be careful.
If you encounter 6 shoppers, you ought to sell (close) 1-3 deals. 2 is really about right. (I am referring to more complex selling than say, a grocery store.)
Why so low? It’s not low. Closing 1/3 of shoppers is a great closing rate. Below that and you need to adjust. Way below that and you have a serious problem. Above 50% and your business is throwing away margin. This works out this way because of the variety of shoppers.
You can’t have the same appeal to the shopper who wants the best and the shopper looking for the cheapest. Right? So, there needs to be a balance point in your closing ratio. That ends up at around 30%.
But how do people decide? Don’t they look at features and benefits first, then match those to price?
Shoppers make an emotional decision first. Do they like you? Do they trust you? Do they feel good about what you are offering? Does what you are offering “turn them on”? If yes on one of these, they’ll consider price. If the price is not too far out of line, they’ll go with you. You. Not the cheapest. You.
Shoppers make an emotional decision first and then look for evidence to support their wisdom.
Starting the relationship by throwing features and benefits at someone fails to secure the emotional bond that will be the basis of their decision at the end of the process.
No, this isn’t true, is it? Well, have you ever looked at a new car, really liked it, and then spent several days making up reasons to “need” it? We do that all the time. Price? Well, we may look around to be sure we’re not being taken, but if the price is in line, we’ll return to where the love affair with the product began. We will make excuses for that too. “He was so nice.” “I can get it today.” “They have the model I want.” “I won’t have to worry about damage in shipping.”
When selling, build trust first. Supply features and benefits as needed. Slick brochures with beautiful pictures sell more product than features and benefits lists.
Chris Reich, TeachU