Do you often put a lot of work into a sale, miss out by a small margin and walk away empty-handed?
This happens because the world of sales is a zero-sum game. Which means there is usually only one winner, there are no benefits to falling in second place.
But there might be a better way…
Sometimes it’s worth getting a deal done even if it wasn’t as big as what you intended it to be in the first place. This is called “down selling”.
In this video I’m going to show you the uncommon art of salvaging sales using “down selling” as a strategy.
DOWN SELLING EXAMPLES
Down selling is the art of strategically closing prospects when they are on the way out of the door.
When you down sell, you close sales that otherwise would have gone to your competition. When you down sell you’re getting deals done even if they are less profitable than what you would have liked.
Think of it like this, if you don’t down sell the prospect when the sale is about to fall apart, it’d be like buying a pedigree puppy. Spending a fortune feeding, grooming and training the dog. Driving them to a dog show, all happy and content that you’re going to win some awards… and then throwing the dog out of the window of the car on the event.
Clearly this would be bad for the dog and you’ve wasted a lot of time and energy as well.
So make sure you’re down selling the buyers who might get away.
Let me give you a couple of examples down selling –
Let’s say that you are selling SAAS (or software as a service) to the engineering industry. You might have multiple tiers of service that you can offer.
Say a buyer engages with you, you then go through the entire sales process with them and you know that they should be on your premium tier service. However, at the last minute, something changes within the prospects organization and now their budgets have been slashed in half.
At this point you have invested considerable time into the deal and so it is worth down selling them on a different tier service so that you can still recuperate some of those costs.
Another example of down selling would be reducing your minimum contract length on a monthly service product and giving the buyer a little bit more freedom to leave if the service does not sue them.
Of course you don’t want to start the sales process by offering discounts, pitching cheaper services or making contract concessions but if that what it takes to stop a deal going to your competitors then sometimes it can be worth it.
So other than getting the deal done, what are the benefits of down selling the buyer?
DOWN SELLING BENEFITS
The biggest benefit to down selling a buyer is that you build trust. When you show that you’re willing to work with an organization to implement your service at a price they can afford, you build trust in the organization.
Often called the “land and expand” approach to selling this is often the best way to close very large service accounts.
When I was selling medical devices, I would often down sell a customer in the first instance so that I could get a deal completed very quickly. Then I would sell larger deals into the account over time because they already had our company approved as a supplier within the procurement department and they already trusted us to deliver on our promises.
The other major benefit to down selling a buyer is that you manage to claw some revenue in, when otherwise it would have disappeared into the market.
Although it might be disappointing for you to get the deal you want to in the first instance, down selling can often help cushion the blow.
HOW TO DOWN SELL?
So how do you down sell a buyer?
The process of down selling is very simple. You must go into every sales conversation having a BATNA. Otherwise known as a best alternative to a negotiated agreement. This is a plan B in case your plan A of closing the bigger deal doesn’t work out.
So don’t discount at the beginning of the sales process, don’t offer concessions on your service or contracts the first time a buyer asks for them. But always have a BATNA ready to down sell your buyer’s if the original deal starts to fall apart.