You've been working with a dream prospect for months and they're ready to cross the finish line with you.
The time and energy you spent leading them through your sales cycle has finally paid off.
It's clear you did a great job of qualifying them to understand their pains, explained your competitive advantage, presented awesome value, and at this point, they've agreed to move forward with you.
All that's left is delivery of the updated agreement, ink on paper, and then money in the bank.
Or so you thought.
The next day, instead of a signed agreement, you get an email from the prospect asking you to give them a call when convenient.
The call might go something like this:
You: Andrew, good morning! What can I help you with today?
Andrew: Johnny, I'm sorry to say this but we're going to stay with our current provider after all. I sent our notice of cancellation and they reached out immediately to offer a lower price and they've committed to putting extra folks on fixing the issues we've been having. We decided at that time to sign a renewal agreement with them.
After putting so much time and energy into this deal, that news would be devasting to hear.
And even if you were able to save that deal, who's to say this wasn't going to happen again? How do you know you'll be able to win back the next one?
Wouldn't it be better if you could have avoided this situation altogether?
Unfortunately, situations like this are more common than you'd think.
You get a verbal agreement to move forward only to be blindsided soon after with their decision to stay put.
Luckily, there is a way to hedge against this same situation happening to you.
And doing it correctly will not only prevent you from losing the sale but help solidify in the prospect's mind why they are leaving their current provider.
The question of when to bring up this topic is an easy one to answer.
IMMEDIATELY! This is key!
It needs to happen immediately after you've "closed the deal".
Whether that was over the phone or in person with a handshake; your immediate next step should be to begin the coaching process.
You might not think that a day will make a difference but in the example I described earlier, it made all the difference.
If for some legitimate reason you can't do it immediately (I really can't think of a reason - if you can, let me know) then be sure to ask the prospect when they plan to notify their current provider.
You want to make sure you cover this topic BEFORE they update the incumbent.
Remember that you're trying to be preemptive.
This sales technique is much less likely to work if you are trying to recover from the incumbents counter offer. They've already gotten back in the prospects head.
And like in the example above, you may already be too late.
At first this step may seem a little awkward but once you've practiced it a few times and adjusted the talk track to match your style, it will be just one more part of your closing process.
The good news; if you did a great job during your discovery then you'll have all the information you need to craft scripts using the clients own words.
We'll come back to that later.
In the meantime, remember that all you're doing is preparing your prospect to reject the counter offer they're likely to to be presented with.
This one simple act will help you take better control over the sale and make sure they don't back out as soon as the incumbent gets them on the phone and back in their head.
Here's an example of how to broach the subject with your prospect.
You: Amber, I'm so excited to start this project with you. One item I want to make sure we cover is what you're going to do when your current provider comes back to you with a "better offer" in the hopes of keeping your business. I've seen this more times than I'd like to admit and when it does happen it usually puts you right back to where you started from. With them overpromising and under delivering.
If you're open to it, I'm happy to explain how some of my other clients have responded to these situations.
You: Great. Well as you mentioned when you first invited me in the main reasons you were considering a change is because of X, Y, and Z. Would you agree it's likely they'll "promise" to fix those issues if you decide to stay with them?
Amber: Yes, that's most likely.
You: I think so too. So besides fixing those issues what else do you think they might come back to you with, or offer in the hopes of keeping your business?
You'll want to pay close attention to what they think the incumbent will come back to them with because you'll focus on these building scripts for these first as you start coaching them.
And it doesn't matter what they think their current provider will come back with; as long as you listen to them and they know they are being heard.
Keep in mind, they may have no what will happen.
If that's the case then it's up to you to coach them with the scripts you think would be most appropriate or most likely.
And besides role-playing it with them it might be a good idea to print out some bullet points or scripts for them to use when the time comes.
Before we jump into the desperate measures the incumbent will use and the scripts your prospect will use to overcome them, I want to go a little more in-depth into why this tactic works.
When you coach your prospect you are taking away your competitor's ammunition against you.
For the most part, no matter what they say or are willing to do to keep their client, you have already prepared your prospects response.
At the same time, by going through these scripts with your prospect, you are giving the prospect another mental checkmark as to why they should leave their current provider and work with you instead.
All businesses are run by humans (for now) which means, to a certain point, their possible reactions are predictable.
If you understand this predictability then you can use it to help your prospects avoid making wrong choices, and hedge against what your competitors are likely to say or do to dethrone you.
A great example of this is from the movie 8 Mile featuring Eminem. The climax at the end of the movie is a rap battle between him and his nemesis "Papa Doc".
Instead of what any other respectable rapper would probably do, which is make fun of or diss the other rapper, Eminem does the exact opposite and makes fun of himself.
Everything from living in a trailer with his mom to getting jumped by "Papa Doc" and his crew to having an idiot friend who shot himself in the foot.
His lyrics systematically unload the ammunition "Papa Doc" was going to use against him in the rap battle.
This is exactly what you are doing with your prospect and competitor.
You are stealing your competitor's ammunition and arming your prospect against them.
Check out the clip below to see what I'm talking about.
Remember, it's important to not only disarm your competitor by prepping your prospect for the enevitable call, but also to arm your prospect by coaching them on how to respond.
No matter what the incumbent says or offers; your prospect won't be caught off guard or make a rash decision.
They'll know exactly what to say when the situation presents itself.
The thought of losing a client can send some salespeople and companies into desperation.
Even to the point where they are willing to lose money on the deal simply to save face or keep a client.
The good news for you is that most of the steps that an incumbent is willing to take to keep their client are predictable; which you can take advantage of.
Below you'll find the top 8 concessions most current providers are willing to give in order to avoid losing their client.
Now, of course, this list is not exhaustive however these are the top you're likely to come across.
And as another reminder, make sure to ask your prospect what concessions a current provider is likely to offer when you begin preparing them for these conversations and scripts.
This is probably the most common concession you'll run into in the field.
And surprisingly there are times where doing this will mean they are actually LOSING money on the client.
The great news is that it's plausible the easiest to overcome.
The incumbent offers to lower or beat "any" price in the hopes of keeping the client.
The below script allows your prospect to highlight the disadvantages of sticking with their current provider when they offer to substantially lower their price.
Incumbent: Jim, please don't leave us. We'll drop the price below theirs if that's what it will take for you to stay.
Jim: Thanks Sally. I'm flattered that you're willing to make such great strides to keep my business but I'm concerned that by dropping your price in this situation you will not only limit your resources but my availability to them as well. By lowering my price you will have less money to put back in the product and those who support it. And since I would be at a below market rate, I worry that my service would suffer because of that, intentionally or not. Price is important but it's not the only factor I used when deciding to change.
We've made the decision to begin a new relationship with Bailey's firm and will be fully transitioned by the end of the year.
Incumbent: Jim, if you renew with us we'll cut your annual costs by 20%. You can't pass that deal up.
Jim: Sally, I appreciate your willingness to keep me as a client. But I'm concerned that you're offering to drop my price right now. It makes me think one of two things. One, did you uplift what I pay so much that you have enough room to lower my price at a moments notice. Why wasn't I offered a more fair deal previously? And two, this makes me think that the only way for me to get a fair deal from you is to threaten to leave you. That doesn't speak very well to a strong or lasting relationship.
More often than not, this is the main theme your prospect has experienced with their current provider.
Here's the deal:
They've simply over promised and under delivered too many times that it's forced your prospect to look around.
The incumbent has probably promised:
But here's the kicker:
Your prospect has already started scripting out their response if the incumbent says they'll change.
Why is that?
Becuase they've most likely already voiced their concerns or issues multiple times and still never saw any resolution.
Here are a couple of scripts you can prep your prospect with.
Incumbent: Jim we’re going to make fixing your issue a top priority now.
Jim: Thanks Ralph. I'm happy to hear you're willing to do that. But unfortunately, that doesn't solve what is a more underlying problem. After all, I don't want my issues to take priority only when I've made the decision to work with a new provider. I don't think that's a smart business move on my end.
Incumbent: Jim, we promise to have that feature out by next quarter.
Jim: Thanks, Alex. That's great to hear but I know how product development works. You promise and have every intention of releasing that functionality but then something comes up. You get delayed. It happens, I know it does and that's ok. But I've simply waited too long for this functionality and Kristi's product has it and it's tried and tested. Another thing I'm worried about is that the feature will be rushed and maybe not as stable as it should be or as I need.
Though not ideal, an incumbent may even offer to give away free products or services to offset the frustrations that the prospect has been experiencing.
This is admirable to a point.
But here's why it's different.
Instead of giving away something for free in the name of customer service, like free delivery often is now; it is done out of desperation.
Taking those possibilities into consideration, here are a couple of ways your prospect could handle this eventuality.
But also keep in mind:
The free product they offer may not be something the prospect needs, wants, or even can use.
Incumbent: Jim we’ll give you this other product/feature at no cost if you stay with us.
Jim: Thanks April, I appreciate your willingness to keep me as a customer but I'm concerned with this approach. You see while I'm sure that added product is very valuable to certain businesses, it's not so much for us. That's why we haven't previously purchased it. Adding it to our license would only increase our burden since we’ll have to implement it, train for it, and manage it. You see Kyle did a great job of understanding where we are as a business and where we want to be and from that, he is only suggesting we use the products that have the greatest ROI. Your free product is not on that list.
Incumbent: Jenny, I know you were looking at adding the Platinum Training bundle to your license but the budget wasn't available for it. If you stay with us I can give that to you for free (or substantially discounted).
Jenny: Thank's Fred. That is enticing, however, I'm a bit confused at how you're able to manage to give that to me for free. The pricing you had originally proposed seemed high to us and we weren't able to find room in our budget for it. But here you are willing to give it away for free. How much had you originally marked it up before presenting it to me?
And if the current provider counters with "we'll be losing money by doing so", see again above "They Lower Their Price" script.
I'm happy to say I don't run into this too often.
Can you say the same?
When a competitor starts spitting vitriol about you or your product, you are presented with a wonderful opportunity to show your professionalism and build a massive amount of rapport with your prospect.
Incumbent: Matt we've had other clients leave us and go to Selena's company and it never works out well. They don't know your business like we do.
Matt: Bruce, I appreciate your concern but to say I've made the wrong choice is an affront to my decision-making process. Please know that we qualified Johnny's product thoroughly and concluded that it is a better fit for us now. Also, Johnny has been very thorough himself in making sure the two of us are a match. We’ve voiced our concerns to you and the progress since then has led us to Johnny.
Incumbent: Greg, I hate to say this but I think you are making a mistake. They're known to drop the ball around support, implementation, and delivery. All things I know you wouldn't accept.
Greg: Victoria, while I'd like to think that you're saying that out of concern for my well being, I can't help but think that your response to my leaving, instead of promising to fix the issues we've had, which includes some of those you've mentioned, you've resorted to badmouthing your competitor. In all the conversations I've had with them they have never done that. Instead of focusing on the value they'd bring to my organization. I know now even more than I've made the right decision.
Sometimes the incumbent will try to "guilt trip" a prospect by leveraging the existing relationship they have.
They may point out the length of their relationship.
Or maybe a positive experience the two of them have had over the years.
Incumbent: Carol, we've been working together for over 10 years. You attended my son's graduation party. I can't imagine you'd want to end our friendship like this.
Carol: Stephanie, we have worked together for a long time but at this point, it's the right time for us to part ways professionally. I hope our relationship wasn't predicated on me buying your products or being a customer. If that's the case then I'm not sure what value we can actually place on that relationship outside of the invoices to your company I've paid.
Yes, it happens.
A prospect threatens to leave and all of a sudden season tickets to the city sports team magically become "available for special clients".
Incumbent: Dave, I know how much you love the Clippers. We just happen to have season tickets available for the rest of the season. They're yours if you stay with us.
Dave: Matthew, yes I do love the Clippers. But my receipt of that as a representative of my company would be unethical and completely against our own internal code of ethics. I'm surprised it's not against yours as well. And that fact makes it clear to me that I'm making the right decision.
The only hope is that the prospect does not accept the bribe.
Like trash talking, incumbents will do their best to instill a sense of fear towards you as the new vendor.
They'll dream up the worst possible outcomes that could result from the prospect leaving them.
The funny thing is that this can often backfire.
After all, there are only a finite number of things that could go wrong with a switch.
Therefore it's logical to think that potential situation that the current provider offers up is something they've previously messed up on.
This is an easy one to prep for.
Incumbent: Christopher, what happens if you switch over to them and next year they decide not to support your product?
Christopher: That is a concern of course but because that happened when we first started working with you we (1) know we can adapt, and (2) did our due diligence to make sure that would not happen to us again.