How do you handle customers who resort to using scare tactics? Do you capitulate and give in, retreat and assess the situation, or stand firm and try to move the negotiation forward? Most importantly, do you understand why your customer uses scare tactics as their negotiation strategy? Unfortunately, most salespeople don’t really understand why customers use these tactics. As a result, they often give in to customer demands. However, there are other salespeople who understand why customers resort to using these negotiation strategies.
Instead of capitulating, some salespeople are able to get at the root cause of these threats, identify their meaning and provide a solution. We’ll analyze why these scare tactics are used and provide four approaches to dealing with customers who resort to using threats in negotiation.
The Reasons Customers Use Scare Tactics
Before going into these approaches, it’s probably ideal to review the how and why customers use these negotiation strategies. A customer’s scare tactics are simply a negotiation ploy. It’s their attempt to get you to give in. They aim to use threats as a form of intimidation. In any negotiation, each side has a set of concessions they see as essential to a successful outcome. For customers, these might include price, payment terms, discounts, and or lead time.
When customers request a given concession, and your company is unwilling to grant that request, they often follow up with a scare tactic. It’s their strategy to get what they want and to get your company to capitulate. The key is to determine whether the customer is using veiled threats when concessions aren't granted. In essence, if they use a veiled threat and still continue with the negotiation, then the concession isn't as important as they would like you to believe. The question that must be answered is how you pinpoint these scare tactics, identify those veiled customer threats, and use them to secure an important concession of your own. So, how can you better handle customer scare tactics?
To learn more about defending pricing and handling customer scare tactics, please go here.
1. Assess the Seriousness of the Scare Tactic
How does the customer use their scare tactic? To answer this question, you must assess the seriousness of the scare tactic and gauge the customer’s sincerity. In essence, it’s about understanding how serious the threat is by defining its impact on your business. However, you don’t have to wait for the end of the negotiation to find out how serious your customer is. In fact, most customers use scare tactics throughout the same negotiation. If you pay close attention, you'll notice how some customers repeatedly use the same approaches and still move forward with discussions. If they do use these tactics and still continue negotiating, then it exposes the fact that they aren’t serious about following through with their threats.
2. Define the Urgency of the Request
When are customers most likely to use scare tactics? Well, it almost always coincides when a concession of theirs has been refused. However, if customers follow up a refused concession with a scare tactic, and yet still continue the negotiation, doesn’t that mean the concession isn't that important to them? Ultimately, if the concession were important to them, wouldn't they state it as such? In this case, customers who place greater emphasis on a given concession, typically change their tone, approaches and demeanor. Granted, not all customers do this. However, most customers who use veiled threats always match them to concessions that aren't as important to them. The best sales professionals pay close attention to when customers use scare tactics. They make a mental note of how these threats are used and track how often they occur in order to gauge the customer's sincerity.
3. Match High Value Request With a High Value Request
The best way to secure a request of your own is to make sure you match the importance of the customer’s request with one of equal importance. Immediately after the customer uses a scare tactic, you must follow through with a high value request of your own. This is of course, if you are willing to grant the customer’s request. In this case, it’s about matching the customer’s concession with one of your own. These concessions help move the negotiation process forward by providing each side with a set of criteria they deem to be important. When you grant a concession, the other party must be willing to grant one in return.
4. Anticipate Customer Requests
One of the easiest things to remember is the importance of anticipating the other party’s requests. To be successful means to come up with a list of high value requests you believe your customer will make. In return, make a list of your own high value requests. When confronted with a customer who sees a concession as important to them , be sure to match it with one you see as essential to you and your company. It’s about anticipating customer requests and defusing their threats before they occur.
When it comes to B2B sales negotiation, most salespeople immediately give in to customer scare tactics. Their concern lies with losing business. However, when one pays close attention to how these threats are used, it becomes readily apparent that most customers are simply using them to get you to capitulate to their needs. Instead, identify these requests, pay close attention to how customers use veiled threats and if you see their request as being highly important to them, match it with an important request of your own.
The simplest strategy to adopt in negotiation is to match a high value concession with a high value concession. Your focus should be to come to a negotiation with a list of your own concessions and those you believe your customer will ask for from your side. If you can anticipate their needs, and match a high value request with one of your own, then you've simplified the negotiation process.
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