Snag the Sale - Overcoming Customer Objections

When you have a challenge, and the response is equal to the challenge, that’s called ‘success.’ Once you have a new challenge, the old, once-successful response no longer works. That’s why it is called a ‘failure.’”

- Stephen R. Covey, Seven Habits of Highly Successful People

For the past several years, dealership business managers have utilized menu sales as a non-evasive approach for presenting product options to customers. Proper use of the menu selling technique meant that managers could present 100% of their products to 100% of their customers 100% of the time. Unfortunately, too many managers have continued to present the menu in the “same old way,” using outdated and ineffective sales methods. As Mr. Covey observes, “If we keep doing what we’re doing, we’re going to keep getting what we’re getting.” In this case, what “we’re going to keep getting” is a large number of unsatisfactory customer responses.

Under Covey’s school of thought, every customer represents a new challenge. Therefore, if finance managers are still presenting products using their “once-successful response that no longer works,” they can expect nothing more than failure. Failure, in this instance, means fewer products sold, lower commissions and smaller bonuses. It also means lower profits for the entire dealership. Obviously, this is not a good thing! In order to work proficiently and successfully with the industry’s savvy clientele, managers must be willing take a fresh look at their menu challenges and create new responses.

First Things First: Win Trust

Why do customers buy any products at all, either from car dealers or any other store? They either need them or perceive value in them. Most customers, however, will refuse to purchase any product at all if they believe the store or sales person is trying to take advantage of them, either by misrepresenting the product or “feeding them a line.” Knowing this is extremely important, if product sales in the dealership finance office are to take place at all. How can managers convince customers of their need for one or more products before closing on a vehicle sale? First, they must win their trust. This is not an easy task in today’s marketplace. In fact, it is impossible, if eager-to-sell managers haven’t learned anything about their customers’ needs before presenting the menu. Only by asking the right questions, listening closely to the answers, and responding appropriately to them can managers understand their customers’ needs.

The conversation begins with the finance manager meeting customers outside the finance office (often by the sales desk) and the conducting of a proper “needs” fact-finding conversation to determine driving habits and car care concerns. Trust, these days, is built on more than a bleached smile and the smooth delivery of memorized jargon. Trust is built on letting customers know the dealership cares about the well-being, safety, security, and comfort of everyone riding in the vehicle about to be purchased. Honesty. Integrity, Reliability. Dependability. Consistency. These aren’t just words. They are the foundation for building a profitable relationship with customers who have the potential to become loyal repeat customers. A successful customer relationship is not momentary. It is long-term. Customers who like and respect the finance manager before ever entering his office will be far more receptive to the menu presentation, and, therefore, more likely to make one or more purchases.

Listen. Ask the Right Questions. Listen Again.

What happens when a customer chooses not to take advantage of an option but, instead, wants to stay with the base payment? Remember Covey’s definition of success as “a response [that is] equal to the challenge.” Managers who lack the skills to determine the reason behind the customer’s objection will lose the sale. A well-trained manager, on the other hand, will have several surefire techniques to manage an effective product close. Remember those initial conversations out at the sales desk? Successful managers asked specific questions there and listened carefully for the answers. This tells them what their customers need and exactly which products on the menu would be the most beneficial. Some customers may say they plan to keep the vehicle until the wheels fall off. Others may be uncertain that they would meet their monthly payments if they experienced some sort of financial adversity, such as a serious illness or unexpected unemployment. Even seemingly trivial concerns may prove to be extremely important: one manager tells of a customer who said she wanted tinted windows because she was always forgetting her sunglasses at home! Obviously, every situation calls for a very different solution. The good news is customers will always tell managers what to sell to them and how to sell it. It just takes asking the right questions and listening carefully to the responses. Be prepared to address every customer concern. Be prepared to show the value in every product. Understand that when a customer says, “No, thanks,” this may only be a knee-jerk, defensive reaction. The customer doesn’t actually mean “no” to products that may be of monumental benefit. Anticipating these rhetorical answers is critical in the presentation of the menu. “Let’s just stick to the base payment” doesn’t mean managers should draw up the paperwork yet. It means they should meet this challenge with a response that is equal to it! They need to ask more questions.

This type of strategic conversation appears in other successful sales arenas, too. A customer who may reject a designer suit based solely on its cost may ultimately purchase the suit because of its value. In the face of this initial cost-based rejection, the smart salesperson will use several questions to incite conversation, aimed at determining the customer’s needs. By learning important details, such as the occasion at which the suit will be worn and the desired impression the customer hopes to make, the salesperson will be able to overcome the initial rejection by explaining just how the product meets the customer’s needs (how the suit fits, etc). The salesclerk has built value into the suit and the cost is no longer the issue. Not only will the customer be willing to purchase the suit, she may also buy several accessories (additional products) as well. This is because the salesperson was able to illustrate how the products addressed the customer’s concerns. Most important of all, by actively engaging in a dialogue with the customer rather than delivering an overly-rehearsed sales pitch, the salesperson established trust. This means than a successful sale: it builds the foundation of a long-term relationship with the customer.

Now, Finalize the Sale

Building value in the menu products is the name of the game! That’s how successful managers meet the challenges thrown at them by their increasingly savvy customers. They first find out why their customers have made the choice to stick with the base payment. Then they offer rational responses to address the customer’s needs and concerns. A customer who plans to hold onto a vehicle “until the wheels fall off” needs a long-term service contract. A customer who is concerned about losing his/her job or getting hurt on the job needs to take advantage of a disability product. A customer who plans to trade the vehicle on a new model within three years needs a paint and fabric protection product.

Overcoming objections to menu products requires detailed knowledge of the product and refined presentation technique. Even with such exhaustive preparation, some objections will challenge even the best managers: The reason I chose not to take advantage of the service contract is I bought one before and it never covered anything. I have my own mechanic. I can’t afford it. My pastor told me not to by a service contract, because it’s a waste of hard-earned dollars. If I’m buying such a quality car, why are you trying to sell me a service contract? Are you trying to tell me the car’s a lemon?

No matter how difficult their customers’ objections are, however, well-prepared managers are able to meet the challenge. They inspire dialogue with well-thought-out questions and comments. They connect on a personal level and with the customers’ specific interests. They know how to do this, because they conducted a friendly, but purposeful dialogue out by the sales desk. Dealership managers are not serving a customer well, if they push a long-term service contract knowing the vehicle will be traded within three years, just as the salesclerk at the retail store does a disservice to her customer by saying an ill-fitting suit looks wonderful. If the menu product makes sense, if it brings specific value to unique customers, and if these customers can perceive the benefits, it’s worth overcoming the initial objections. As Mr. Covey says, “Management works in the system. Leadership works on the system.” To snag more sales and to overcome objections, managers must challenge their “old, once-successful response.” By having the courage to abandon ineffective but familiar techniques in favor of new processes, mangers can turn failures into noteworthy successes.

Becky Chernek is a professor at ADI and the president of Chernek Consulting. She has an extensive automotive sales background, and has been helping dealerships increase profitability for the past 4 as a consultant. For more information about her automotive dealership consulting, please visit her web site at: www.chernekconsulting.com.