Is Doing Business with You Worth the Risk? – Part 1

When we talk about the sales process, one challenge is so obvious we just might miss it. It’s like the nose on the front of our faces. In my humble opinion, and I’ve been doing this for decades, the biggest challenge we face at the kitchen table is minimizing risk.

It’s the biggest factor in the homeowner’s decision, as shown by the multitude of questions the homeowner has for you. You’ll hear questions about your product, your service, your company, your testimonials, obviously your price, and many more.

But what they’re really trying to do is evaluate the amount of risk there is if they make the wrong decision or choose the wrong contractor.

That’s another reason why they get three bids. That’s why they ask all these questions. That’s why they’re so afraid to make a decision today. They want to think about it, pray on it, talk to the banker, visit the priest, meet with their brother-in-law in Tucson, or whatever. People are afraid to pull the trigger because they fear the risk of making the wrong decision.

So, our job, to a large degree, is minimizing the amount of risk in this purchasing decision for our homeowners. Let me give an example.

Change of Heart

Suppose you go into Walmart to shop for a toaster. You go to the housewares aisle, and you pick up a toaster. You think it will be a well-spent $20.

You pay for it and take it home. When you get home though, you don’t like it. You don’t like the way it works. You don’t like the way it looks with the other appliances. You just don’t like something about it.

So what do you do with it? Well, you take it back to Walmart. And what happens when you get there? They exchange it for a different toaster, or they give you your money back.

How much risk is there in buying that toaster? Virtually none because you know you can get a refund or an exchange. But think about this for a second.

Imagine yourself back in the housewares aisle. But instead of the $20 toaster, you buy the fancy one for $200? It can be tilted on its side and can reheat cold pizza slices. But the writing on the shelf says, “All sales are final, no refunds, no exchanges.”

Am I Just Hunger Shopping?

How much harder is it to buy that toaster now? It’s a lot harder, right? Because now there’s a lot of risk of making the wrong decision. If you get home and it doesn’t work or you don’t like it, you’re stuck with it because there are no refunds or exchanges. So now the element of risk is very high.

So what type of behaviors does that drive? Well, you might start worrying you’ll rush your decision. I better think about this overnight. This is a big decision. I need to research all my options and shop prices at all the other stores and online.

Does that sound familiar?

Absolutely, right? Because homeowners always tell us, “I need to think about it.” Why? Because they’re evaluating the risk the same way as we would in Walmart. You might start thinking, “I had better go over to The Home Depot and see what they have. I need to shop at multiple stores to find a cheaper toaster, so if I do get ripped off, I’ll waste less money.”

You see, all of these, what I call dysfunctional buying behaviors, come from the element of risk. The homeowners fear making the wrong decision, so they postpone the purchase and do everything they can to avoid making the purchase because they fear the risk of being burned by the mistake.

So what does that mean for us?

Low Risk, High Reward

That means we need to ensure the homeowner that their risk is minimal. That’s one reason retailers offer money-back guarantees. They know that if they minimize the risk, you are more likely to grab that toaster and go home. You’re probably not going to bring it back.

But you know that if you can make them understand investing in your product isn’t risky, it will make their decision process easier. The higher the risk, the more difficult it is for people to say yes.

The lower the risk, the easier it is to say yes. So, our objective on a residential sales call is to minimize the risk for our homeowners. Now, there are a couple of ways that we can do that, and I want to talk about those with you in the near future. Have a great week!