Behind The Reasons Your Buyers are Freezing Budgets & Cutting Costs
Furloughs. Layoffs. Hiring freeze. Budget freeze. Recession. These are all terms we are hearing every day in relation to the economic impact of the COVID-19 pandemic. Entities across all industries, from tech giants like Google to schools like Berkeley, are slashing budgets in order to stay afloat. What will be the ultimate economic impact of this crisis?
Forbes explains, “There are simply too many unknowns surrounding COVID-19 for investors to predict the economic impact, leading to fear and extreme volatility.” This uncharted territory is the environment in which your buyers are now operating. Understanding their pain points, approaching them with an empathetic attitude, and adapting to this new selling atmosphere will be key to maintaining trust, and ultimately keeping your customer.
“Budgets are Frozen.” Why?
Most likely you’ve already heard the “budgets are frozen” response. Companies across the globe and throughout all sectors are making some hard choices in order to mitigate risk. Their cash flows are interrupted because their buyers are cutting back too. Your clients are desperately trying to keep money in their reserves. As a result, a lead that was hot before the COVID -19 crisis is now suddenly stone-cold.
It’s critical that sales teams understand this domino effect. Sales reps are used to pushing harder, adding more incentives, or simply revisiting the benefits of their products when they encounter a prospect who is withdrawing. However, those tactics simply won’t work in the current environment, and they might even push the client further away.
It’s critical to understand why your prospect is giving you the “budgets are frozen” excuse. Understanding their pain points will help you adapt your message, gain their trust, and earn their business, even if that means waiting for it.
Gather intel from your fellow sales reps. Insights gathered about the challenges their customers are facing are likely the same that your clients are dealing with. Teamwork might be a little challenging when reps are working remotely. However, it’s still possible to have productive sessions. Schedule regular team meetings to share customer feedback and concerns.
Team collaboration will enable your reps to gain a broader understanding of the impact the COVID-19 crisis is having. Additionally, you’ll be able to identify emerging trends. For example, in what key areas are your clients making budget cuts? Are they thinning their staff? Are they cutting IT budgets? What budgets are getting frozen? Are they concerned about retaining customers or not being able to effectively recruit new ones? Discern their key areas of concern.
Additionally, gather intel online. Follow what’s going on in the news or on social media. Don’t wait for your clients to tell you what’s happening in their world. Absorb trends in their industry, as well as any company-specific announcements. Use this intel to be proactive.
Serve First, Then Sell
The best sales pitches are discussions. Get the client to talk about their organization, the challenges it is facing, and how they plan to mitigate risk. Ask open-ended questions to really delve deep into what’s going on. Acknowledge that your clients’ (and prospects’) priorities have shifted and that you are there to serve them through these unexpected challenges.
Be empathetic. While most sales reps receive training in lead generation, effective negotiation, and account management, they rarely go to a training class on displaying empathy. “Without empathy in sales, a salesperson can’t influence others, and prospects don’t buy from salespeople who don’t understand them,” noted SalesForce.
Why is empathy so important? “Empathy creates an emotional connection, which elevates the sales conversation,” explained Colleen Stanley, President and CSO of SalesLeadership Inc. Empathy will help you understand the reasons your clients or prospects may be stalling. You’ll understand their budget crisis. They’ll sense that genuine concern, and a trusted bond will form.
Empathy means you accept the client’s interpretation of events instead of immediately passing judgment or putting your own interpretation into what they said. Sales reps spend a lot of time trying to change the buyer’s mind. Empathy forces you to pause the mind-changing game until you fully understand the client’s point of view.
Being an empathetic listener is especially critical during the COVID-19 crisis. Many business owners are under great stress. They are genuinely worried about the survival of their business, as well as the personal livelihood of their employees. Letting them know you empathize with their situation will build a bond that will likely drive them to your business when they are ready to purchase.
Management Must Set the Tone
Be empathetic. Be a good listener. Actions speak louder than words. Showing your team that you empathize with their challenges will help them display the same attitude toward their clients. While sales reps are always goal-oriented, management must prepare for a softening in demand, longer sales cycles, and some order cancellations.
Most importantly, ensure that your sales teams feel supported. Provide them with tools to meet new customer demands. Do you have sales tech that allows reps to easily note or identify clients that are struggling? Are reps able to generate automated emails to existing clients about COVID-related concerns? Do you have tech in place that enables social listening, keeping reps “in the know?”
Can your team effectively communicate with each other? Transparent communication and clearly defined guidelines will help avoid misunderstandings. Identify the needs of the sales team. Reevaluate goals. Introduce new tools and techniques that will help them manage their new workflow effectively. Sending the message that your team is safe and supported will ensure that your clients feel safe and supported.
Vendor Neutral is here to help ensure you get the sales tech and training to meet the changing needs of your sales team. We understand budgets are tight and money needs to be spent wisely. Use our free Stack Selector to sort through more than 400 technology applications, and receive a shortlist of solutions that are most relevant to your needs. Contact our team to get started on your personalized SalesTech Roadmap.