HTSS199 - Using risk vs reward in sales presentations for objections - Scott Sylvan Bell

Risk vs reward in sales and business

Google the words risk or reward and you will see exactly what they have to do with your sales presentation. As you meet with your buyers they are thinking about the risk they have of doing business with you, they just may not say it that way. The risk vs reward levers are used in purchases you make as well as your buyer. 

• Risk - a situation involving exposure to danger
• Reward - a thing given in recognition of one's service, effort, or achievement.

“The juice has to be worth the squeeze in sales and business”

This is really the framework of offers, and or deals in business, marketing, and sales. One of the movies that explain this thought the best is Tommy Boy. At the end of the movie, Tommy needs to sell brake pads. He wants to show a superior product so he talks about guarantees. Some people, not all reduce their risk by wanting a guarantee. Here is the exchange from Tommy and Ted:

Tommy: Ted, why would somebody put a guarantee on a box? Hmmm, very interesting. Ted Nelson: Go on, I'm listening.

Tommy: Here's the way I see it, Ted. Guy puts a fancy guarantee on a box 'cause he wants you to fell all warm and toasty inside. Ted Nelson: Yeah, makes a man feel good. Tommy: 'Course it does. Why shouldn't it? Ya figure you put that little box under your pillow at night, the Guarantee Fairy might come by and leave a quarter, am I right, Ted?

People buy on emotion and justify with logic

You will hear people buy on emotion and justify with logic. People are emotional creatures and do think about the emotions in the deal. People will outweigh what the risk is of purchase and compare it to the reward for what they are getting. Worrying about failure or risk is something people have issues for just about any purchase. Look to risk reversal to help understand how to help serve them.  

How your own stories can reduce risk for buyers 

People want to find comfort when they buy. Stories about your clients' successes and even failures will help you overcome objections you face. You can also reduce reactance and oscillation or the back and forth on a decision. Stories will come to play before you need them.  You will want to have some well thought out stories of how you helped people. The stories can be based upon:

• Psychological
• Physical
• Business
• Life

There is a risk to a low price in sales 

Think through the reasons why risk vs reward is important. What are all of the risks when someone only buys on price? When people solely buy at a loser price their reward is the cheap price, their risk may be high but they are willing to take it. If someone goes with a full offer company the risk may be that they pay too much, the reward is the warranties and guarantees put in place.

Tough questions to ask yourself about risk vs reward in sales 

Here are a few questions to think about when it comes to dealing with the reward of purchases as well as risk. These questions could be asked about your buyers:

• How many of the objections you have had over the last 90 days have happened because the buyer felt like they had more risk than reward?
• How much of your presentation deals with the risks alternative options have?
• How much of your presentations counters with the true rewards you have to offer that nobody else does?
• How many deals have you lost because your competition has better risk reversal and are not afraid to use it?
• What company takes your lunch money, not because of skill but because of expression of risk reversal?
• How many deals could you have sold for more if you had better risk reversal?
• What is the best risk reversal in your industry?
• Whats the best risk reversal you have ever heard of

You can close deals with outcomes

The objections you face may not be about “the money” it could be about the risk. There are image issues when someone makes a bad purchase. There are people who can be harmed in a company with a poor decision.

• Risk of implementing and failure
• Risk of using relational capital in meetings -
• Risk of going too fast 
• Risk of shame in front of a team or owner for a bad decision

Rewards from making the right decision 

Rewards on the other hand can be the dopamine rush people are looking for. 

• Savings that come from the product or service
• Speed of implementation and fixes
• The ability to get someone out of a pickle

The fear in business is making a mistake, to be judged by others, or to be harmed. The truth is there isn’t 100% indemnity from mistakes. You have to be able to help your buyer explicitly see their risk vs reward:

• Guarantees – meant to help people reduce their risk
• Warranties – Meant to