Reducing Risk: What Does It Take?

In my new book, I'm addressing the topic of RISK because it's such a huge factor in decisions these days. That's why I'm wondering:

How do you minimize the risk your prospects feel in doing business with you or even changing?

KEY POINT: You're working with prospects who have decided to switch from the status quo. All change involves some sort of risk.

• From your prospect's perspective, what risks are they facing?
• What do you do to lessen or eliminate their perception of these risk?

P.S. I'm hoping to include some of your responses in my upcoming sales book.

Comments

[Jeff Garrison]

There is always risk for the decision maker when they present a solution to a group internally. I teach sales people that early on they should set the stage for having a meeting or a phone call with all of the stakeholders. If they can at least get 15 minutes to confirm the priorities of each person, they can help prevent a proposal from getting unnecessarily critisized because of one person's agenda. This reduces risk both for the sales person and the internal "champion" with whom they are working.

My experience is that a few minor things are changed as it regards how the issues are stated. Rarely does something major come up. Regardless, when everyone has input before a specific solution is proposed, the risk is reduced for everyone.

[Len Kamerman]

We lessen the risk by asking our Microsoft CRM and ACT! clients to pay in full up front and offer them a money-back guarantee. If after project implementation they are not satisfied with our service, they may call us, articulate the shortcomings, and we'll cut them a check for the difference between the price paid and what they feel the completed project is worth.

[Bob Apollo]

Hi Jill
Great question - and one that’s incredibly relevant in today’s market, where the avoidance of risk may well be the predominant emotion driving buying behaviour, and where so many buying journeys end in a decision to hold off and do nothing for the moment.

I’m speaking from the perspective of complex B2B buying processes, where it seems that having a strong ROI is not enough to win the prospect’s confidence. Successful vendors are having to prove that they offer the lowest risk of all possible alternatives, including - this is critically important - the decision to simply “do nothing”.

Sales people can’t hope to emerge as the lowest risk alternative through some last-minute slight-of-hand during the closing process. The foundations need to be built from the start of the buying process. Rather than diving in to premature (product) elaboration, when a prospect acknowledges an issue, the top sales performers I’ve been able to observe seize the opportunity to explore:

- What has caused the issue to become important at this point?
- Who else is likely to be affected by the issue?
- What would be the cost/impact of not dealing with the problem?

Handled well, these and similar questions can open the door to identifying and connecting with the other affected stakeholders early on in the sales process. Just as important, they can lay the foundation for helping the prospect identify the costs and consequences of not dealing with the problem.

In fact, I advise the clients I work with to think very hard about qualifying out opportunities where the prospect cannot easily articulate the consequences of inaction – because in today’s risk-averse climate they run the risk of doing all the hard work of eliminating the competition, and getting chosen, but not getting bought.

Vendors who are able to help their prospect clearly balance the benefits of solving the problem against the costs of doing nothing, and to present this to the financial approval process, will be in a much better position to address the risk issue – and will have truly earned their role as “trusted advisor”.

[twitter.com/casey_hibbard]

Hi Jill,

You probably already have this in your outline, but customer case studies and success stories of course! Reduce the perception of risk and increase buyer confidence by showing them examples of companies that have successfully gone before them - and the specific results of that.

A customer example can be used in multiple formats - written, verbal, PowerPoint, video, etc. to continuously reinforce your track record. And the more similar your example customer is to the prospect, the more it will resonate.

Casey

[Jim Keenan]

Jill, the most overlooked component to risk is that it's personal. What one calls risk, another doesn't. That is why some sky dive and others won't even fly. Risk is a lens. It's a lens that shapes how people look at things in terms of gain or loss.

To assess risk, you have to understand the lens each person in the decision process is looking through.

Risk is also rarely logical. Example, the risk to approaching an attractive stranger and introducing yourself is low (a simple no), yet the potential gain is high (a future partner or even spouse). Yet for many the risk feels huge and can be crippling, regardless of the gain. We all see/assess risk differently

Getting to understand the personal lens is critical to understanding your prospects perception of risk. I can tell you one prospects risk, is another persons sure thing.