Putting Pen to Paper: Our favorite closing techniques

Published on Sept. 2, 2021

Peter Harms, Partner, Simon-Kucher & Partners

Chris Moody, Senior Consultant, Simon-Kucher & Partners

Derek Enge, Associate Consultant, Simon-Kucher & Partners

You’ve spent a lot of time speaking with a potential customer, and talks have reached that crucial phase — Closing. You dance around the subject, unable to put the sentences together that will result in the customer putting pen to paper. Sound familiar? For many it does. Is there something you can do to fix it? Absolutely.

Closing techniques can accelerate the sales cycle and increase your conversion rates.

A prerequisite for closing techniques is that you have uncovered your customer’s needs and that your offer addresses these needs. It is essential that your customer fully understands the value your products deliver and that this value is far greater than the price you are asking for. Having said this, let us fast forward to the final stage in the sales process. In our experience, there are five techniques that are the most effective to use when closing.

1.????Bridging the Gap Close

This technique probes if the customer has any remaining doubts or reservations. You can ask the customer, “is there anything preventing you from going ahead with our offer?” If the answer is no, then the only thing left to do is put pen to paper. If the answer is yes, it gives you an opportunity to alleviate those concerns and then move forward.

Why is this technique effective?

The Bridging the Gap Close is effective because it actively probes for potential objections and triggers the following two scenarios:

1. In a case where there are still concerns, the seller now has the opportunity to directly address these concerns.
2. In a case where there are no concerns or all mentioned concerns can be handled, the seller can make use of the Consistency Effect: Individuals strive for consistency between their statements and their actions. After stating that they have no remaining reservations, it is consistent to move forward with a deal.

2.????Summarizing the Fit Close

The technique wraps up the discussion by summarizing how your offer effectively meets all the needs that you have uncovered together with your customer. As you provide your summary, ask your customer to actively confirm the fit. This paves a Yes road to closing. This technique is best utilized when you feel your customer is generally aligned and all that remains is that crucial final step.

Here is an example:

• Salesperson: “Let me summarize. Based on what you said it seems to be very important that you get x, y, and z. Is that correct?”
• Customer: “Yes”
• Salesperson: “Understood. And you said that you are not interested in a and b. Right?”
• Customer: “Yes”
• Salesperson: “Based on what you said, the right product for you is X. Would you agree?”
• Customer: “Yes”

To maximize effectiveness, the Summarizing the Fit Close should be followed by an operational statement that assumes that the deal has been signed, e.g. “So when should we deliver? This month or next?” As you’ve laid it out to them, the only logical next step for the customer is to put pen to paper.

Why is this technique effective?

The Summarizing the Fit Close leverages the same psychological effect as the Bridging the Gap Close, the Consistency Effect. If your offer meets the needs that your customer has voiced, it is a logical step to go ahead with the buy. This technique also gives you a final opportunity to demonstrate your solution’s value and how this outweighs the investment.

3.????Focusing on Favorable Alternatives Close

This technique presents the customer with different options that are all favorable for closing the deal. Here is an example:

• Salesperson: “Which of the three offer options GOOD, BETTER, BEST is the best fit for you?”
• Customer: “Better”
• Salesperson: “Understood. Let me send over the agreement. Should we meet this week or next week to finalize the paper work?”
• Customer: “Yes, let's meet this week”

The above questions are more likely to trigger a close than “Would you like to go ahead and buy?” Why? Because this question includes “No” as an answer. The above approach does not present “No” as an option and therefore steers the customer to favorable options.

Why is this technique effective?

There are two reasons.

1. Our brains tend to take shortcuts and shy away from thinking outside of the box. Since not buying isn’t presented as an option, there is a likelihood that your customer will focus on the presented task: “Pick the option that is best for you”, rather than on the out-of-box thought: Should I buy or is there a better option somewhere out there?
2. Psychologically, when humans are presented with an overload of choices, they are less likely to make a decision. Identifying the best option out of many options is difficult, and this creates uncertainty and a hesitancy to buy. This is known as the Paradox of Choice. By limiting the number of options to a few relevant ones you decrease the level of felt uncertainty. It is much easier to pick the best option out of 2 or 3 relevant options than out of 10.

Agreed, this technique is not as powerful as the first two techniques. However, you will be surprised how well it works. If you don’t believe it, here is a tangible example outside of the business world. When I am getting my young daughters ready for school, I have found that if I ask them: “Do you want to wear this T-Shirt”, I win 3 out of 10 times and they answer “Yes” and get dressed. On the other hand, when I ask them: “Do you want to wear the red T-Shirt or the blue T-Shirt”, I win 7 out of 10 times. I can up this to 10 out of 10 by choosing a good option and an option which I am relatively sure that they will not like.

4.????Showing the Urgency Close

The technique creates a sense of urgency by illustrating the opportunity cost of not closing the deal today.

It is crucial that you demonstrate to the client what they will miss out on if they do not close. This puts pressure on the customer to speed up their purchase decision.

You can best do this by discussing the future benefits to customer with the assumption that you’ve closed the deal that day. “You’d be seeing an X% increase in sales. In order to get this in time for you to present it at the Q3 board meeting, we would need to start now.” The urgency in this example comes from the customer imagining the benefits of signing today and therefore, once again, demonstrating the opportunity cost of not closing in that moment.

This technique can be easily applied when the product sold requires an implementation time. In this case, urgency can be raised as follows:

• Salesperson: “When do you want the product to be up and running?”
• Customer: “Best would be prior to our strategy meeting in August”
• Salesperson: “Ok. Implementing takes around 2 months, independent of the vendor you choose. So we should start implementing in a week. When do you think that you will decide? Would it be possible to decide this week? I would love to confirm an implementation team for you as soon as possible.”

Why is this technique effective?

The Urgency Close is effective because it subtly applies pressure to your customer by demonstrating the importance of closing immediately.

Do you have to be careful with this technique?

Yes, this technique can come across as salesy and thus harm the trust that your customer feels towards you as a salesperson and your offer: Many people want to buy things, but few want to be sold something. To prevent this from happening, it is wise to launch the Urgency Close very early in the sales conversation, as part of the discovery phase. Then merely reference the urgency when closing: “As we had discussed earlier, you said that you wanted to be quick in getting started with this product. What are the next steps? Should we finalize the agreement now, or would you like to include more people and we can plan to meet again next week?”

5.????Asking for a Trade Off Close

This technique is utilized when the customer is starting to bargain. With this technique, you say YES to your customer asking for a price decrease with the caveat that you have to take something off the table in order to do so. An example for this could be:

• Customer: “This is quite expensive. I expected half the price. Can I get a discount?”
• Salesperson: “Yes, I fully understand that this is quite an investment. ... How about going with the smaller option I showed you? I think it is very good as well. ... Would this be a better fit?”

The question triggers two scenarios:

1. If the customer really doesn’t care for the added value of the option or feature that is taken away, it is good that you finally talked about it. Taking the option or feature out will right size your offer while reducing your cost and increasing your likelihood of selling.
2. ?If the customer was really just bargaining, the customer now knows that a price decrease comes with a performance decrease. This underlines that your prices are fair and reduces your customer’s appetite for discounts and prolonged haggling.

Why is this technique effective?

This technique works because many customers have become habitual price negotiators. Saying NO leaves a negative impression. Saying YES to their ask by letting the customer choose between price and performance signals

• that you are trying to help them and thus preserves good will, and
• that your prices are fair and thus not open for negotiation.

On top of that, this technique naturally transitions into a Focus on Favorable Alternatives Close by throwing the ball back into your customer’s court: “Do you want “A” at $100 or “A-Minus” at $80”?

Bringing it all together

A prerequisite for closing techniques is that you have uncovered your customer’s needs and that your offer addresses these needs. Uncovering need and selling value are essential for lasting success in sales. Having said this, here are five closing techniques that can help you close your deals:

1.????Bridging the Gap Close: Probe for and respond to any remaining hesitations

2.????Summarizing the Fit Close: Show how your offer meets all uncovered needs

3.????Focusing on Favorable Alternatives Close: Present only options that are all favorable for closing

4.????Showing the Urgency Close: Illustrate the cost of deferring closing

5.????Asking for a Trade Off Close: Discourage bargaining and show value

All of these techniques are great ways to help your customer come to a decision and close the deal. They can also be combined for maximum effect. We wish you a lot of success in using them and selling more at higher prices.

There are many more closing technique out there. We know. Please let us know your thoughts on closing techniques. Which ones are your favorites? And why? Please reach out to us via email or LinkedIn. We would be very happy to get to know your best practices and experience.

ABOUT THE AUTHORS:

Peter Harms is a Partner with Simon-Kucher in Boston.

His consulting focus is on pricing, sales, and negotiation management in the automotive industry.

Peter helps his clients to better understand, quantify, and communicate their customer benefits. He also improves his clients’ capabilities to increase and monetize their customers’ willingness to pay.

He has conducted consulting projects for companies in Europe, North America, and Asia. Among his clients are automotive suppliers, automotive manufacturers, as well as machinery and heavy equipment manufacturers.

In addition to his consulting work, Peter is a speaker, coach, and trainer in the areas of power pricing, sales excellence, and negotiation excellence. Peter studied business engineering at the University of Karlsruhe (TH), Germany, and has been with Simon-Kucher since 2001.

Chris Moody is a Senior Consultant with Simon-Kucher in New York.

His consulting focus is on pricing, sales and negotiation excellence. He has worked closely with management teams to drive top-line growth across industries from software to industrials. Chris is a member of Simon-Kucher’s Competency Center for “Big deal negotiations.” In this function, he supports clients in assessing their power position, setting negotiation targets, and optimizing their negotiation campaign.

Chris received a BA in History and Political Science from Tufts University.

Derek Enge is an Associate Consultant with Simon-Kucher in Boston

Derek is currently a senior at Tufts University. His studies focus on economics, entrepreneurship, and consumer behavior.

Derek has worked across a variety of different industries. Through his work, he has developed a passion for Negotiation Excellence, particularly within the B2B space. Derek plans to continue to support companies in improving their strategy and preparedness for negotiations in the coming years.