In a down economy, it is important for technology and professional services companies to adapt to the existing business climate to generate revenue. In this economy, the prospect's response "I cannot afford it" may actually be a real objection! To improve your technology sales closing ratios in this economy, try the following closing methods:
1. Find your prospect's pain and be a doctor!
Although the economy is flat, companies are still buying technology and professional services. It is just a question of priorities. In today's market space, people are only buying technology that improves corporate earnings. It is the pain that gets the funding. Clients are paying for major surgery, not band-aids. During your client discovery conversations, you must focus on finding the prospect's biggest pain, so you can be a doctor and fix it with your technology or professional service. If you don't know what your prospect's biggest wound is, then you will not get the deal. People are spending money, but only on high priority projects. Be the doctor, find the pain and fix it.
2. Why are you talking to a prospect with a director's title?
Mid-level managers and directors in small privately owned firms and Fortune 1000 companies are not the decision makers. Bypass them immediately and go directly to VP's or above. My general rule of thumb in technology sales is, if the person you're dealing with does not have at least a VP title, then you do not have a qualified prospect for your sales forecast.
3. Hand deliver every proposal and discuss it in person
When selling IT, technology and professional services, set up an appointment to hand deliver your proposal to discuss the business details. Email and overnight delivery services have reduced the personal closing techniques and sales skills of technology salespeople during the last ten years. You need to walk thru the proposal with the prospect in person to keep the one-to-one relationship perpetuating forward as you deal with the proposal's objections. Hand deliver all proposals and you will close more deals.
4. Offer pricing options over time to initiate purchases
Times are tough and cash is tight. Like other industries that sell capital investments, technology companies need to offer better financing terms to their prospects to spur purchases. As long as you are comfortable with the prospect's business viability, stretching payments over time (while delivering the professional service or technology on the original schedule) may close a tabled deal.
5. Cut up your application or service purchase into time pieces
Another method to reduce the prospect's upfront investment is to cut your project's price point into smaller more budget digestible pieces. Find out what budget cycle your prospect is currently in and spread their investment over multiple fiscal quarters (i.e., Phase 1 during Q2, Phase 2 during Q3, etc.)
6. Turn your product into a service
During tough economic times, companies postpone capital investments that have been assigned as a budget item because of their perceived high cost. To bypass the capital budget item issue, turn your product into a service and sell it as a cash flow investment option (i.e., selling application software as a multiple year license that's paid monthly, etc.).
7. Offer a discount that is attached to a specific date
Giving customers a real discount to close business by a specific date may push a hesitating buyer to invest now instead of 2002. However, it must be a real discount and the date needs to be enforced. Letting the client buy later at the discount price makes you loose all creditability. (P.S. Remind your CFO that discounting to get revenue is better than having no revenue.)
8. Give a bonus
People who make business decisions for technology purchases are just like you and I. They buy houses and cars and vacations in Bermuda. Like you and I, they want a great deal. One way to repackage your price point is to give something for free (tied to a purchase date) that clients value highly (i.e., sell an 18-month maintenance agreement for a 12-month price or give them a free web site redesign, etc.).
Selling IT services and applications has never been easy. Complicated by the worldwide changes economically, successful technology firms need to modify their corporate business model to maximize revenue. These eight suggestions should help.
Paul Dimoca is President of DigitalHatch, Inc. (www.digitalhatch.com)
Continue reading "Eight Ways to Close a Technology Deal in a Down Economy! " ... Read the full article
MarketingProfs provides thousands of marketing resources, entirely free!
Simply subscribe to our newsletter and get instant access to how-to articles, guides, webinars and more for nada, nothing, zip, zilch, on the house...delivered right to your inbox! MarketingProfs is the largest marketing community in the world, and we are here to help you be a better marketer.
You may like these other MarketingProfs articles related to Sales: