What are Jordan Belfort’s tips for handling objections in sales? How does conversation looping help you close a deal? How do Belfort’s methods compare to other sales advice?
Objections in sales can be tricky to work around: you want to address all the prospect’s concerns but you don’t want to sound too pushy. There are tons of different methods for handling sales objections. Today we’ll discuss Jordan Belfort’s advice from his book Way of the Wolf.
Keep reading for Jordan Belfort’s advice on how to handle objections in sales.
Handling Objections and Closing
When you ask for an order, you’ll get a definitive yes, definitive no, or maybe. The first two are easily addressed: Either process the order or say goodbye.
The third answer is more challenging because the prospect has objections to buying—this is where the looping process introduced in Chapters 2-3 comes into play. In this chapter, Belfort discusses how looping works step-by-step. It’s essentially backtracking to re-present your case each time he raises an objection, then moving forward with the sale again.
Here’s a big-picture view of Belfort’s looping strategy for handling objections in sales:
- When you ask for an order the first time and get the first objection, sidestep it and backtrack to uncover the prospect’s underlying uncertainty.
- Address the uncertainty by re-presenting your case logically and emotionally (looping).
- When you moved the client to a 10 in all three key areas, ask for the order again.
- If the client raises another objection, this time acknowledge it rather than deflecting it. Use your acknowledgment statement as a segue for re-presenting your case logically and emotionally.
- Ask for the sale again.
- If the client raises yet another objection, focus this time on his action threshold (you’ve already raised his certainty level (twice), but he’s still not ready to buy, so you need to take a further step). Remember, the action threshold is the overall comfort level he must have for committing to a purchase.
- Use one of four ways (detailed below) of lowering his action threshold.
- Ask for the order a third time. At this point, most people are now likely to say yes.
- However, if the prospect still isn’t ready to commit, determine whether it’s worth continuing the sale or whether you should walk away. If you decide to continue, lower his action threshold by increasing his pain threshold (the point at which his discomfort with the problem will drive him to alleviate it by buying your product).
- Now transition to a final close.
(Shortform note: Other sales trainers credit Belfort with coming up with the looping idea, although some have developed variations, for example a seven-stage loop. For more on how Belfort’s looping strategy works, check out his free online training in The Basics of Looping.)
|An Alternative Approach: |
Low-Pressure Sales Subjecting a person to the same sales presentation three or four times, as Belfort’s system does, could come across as high pressure to some prospects, especially in B2B sales, and prompt resistance. A 1947 Harvard Business Review article that’s still frequently quoted today popularized low-pressure selling as a B2B alternative; this approach underlies customer-centric sales methodologies today. Author Edward C. Bursk defined low-pressure sales as allowing people to make their own decisions rather than pressuring them into specific purchases.Similarly, To Sell is Human contrasts traditional high-pressure selling with what the author calls a modern (no pressure) method of creating affinity with the buyer through a formula focused on providing a valuable service.
A Looping Conversation
Here’s how Belfort’s looping process might play out in a sales conversation with a marketing director about software to manage her print projects, such as direct mail pieces:
A typical first objection might be that the prospect thinks the price for the software system is too high. Respond by sidestepping: “I understand what you’re saying, but aside from the cost, do you see how well our software would work for you—how much it could boost your efficiency and quality?”
You can determine where the prospect is on the certainty scale at this point by how enthusiastically (or not) she responds. If she’s at less than a 10 on the product, respond “Right, it’s a great deal! One of the biggest benefits is how much time it saves you by automating and tracking the entire printing process.”
Then backtrack to the point where you’d completed the pitch and re-present it, focusing on the strongest benefits and using tone, pacing, and leading to rebuild the emotional case as well. For example: “We talked about how time-consuming and overpriced many print projects are. So let me reiterate that by managing your process from bidding to final proofing, our software saves you 20% on the average project—not to mention, the cost and embarrassment of typos, ordering the wrong quantity, and so on.”
Pause and check in: “Do you follow what I’m saying?”
If you get an enthusiastic response, you’ll next check on her certainty level about you and your company. Shift your tone to mystery/intrigue (“Let me ask you something”) and ask whether she’d have jumped at the opportunity if she’d previously worked successfully with you and your company in the past.
If she agrees (“I probably would”), she’s indicating trust is an issue. Respond in a sympathetic tone with: “I can understand your hesitation to commit immediately, since we haven’t worked together before—so let me tell you more about myself.” Repeat your name, title, and years of experience. Similarly re-introduce your company, describing it as the best, most-respected, and so on.
For example, “I’ve worked for over 25 years in the print industry, first as a vendor and now as a salesman for Print-It Software and Service. I can tell you that Print-It is the most print-savvy software provider in the industry. Our software is specifically designed for managing print projects—in contrast to other companies’ general procurement software, which doesn’t get the job done.”
Ask for the order a second time—offering a slightly smaller purchase or trial if you can, as a way of letting the client test out your products before spending more. For instance, “Let me offer you a discounted 60-day trial so you can see for yourself how much time and expense our software can save you.”
Belfort says that about 20% of prospects with an initial objection will close after one loop. But others will need additional loops addressing uncertainty, or lowering their action threshold and increasing their pain threshold. For example, a client may want to speak to a colleague or receive additional information in the mail.
Acknowledge the new objection, using it as a transition to loop back. For example, you might say, “When clients ask for more time, they often forget about following up. I wouldn’t want you to miss out when I know how much you’ll benefit from the software.” Then loop back and re-present again: “It’s really perfect for you because it eliminates the hassles and glitches of your current system.”
Address the Action Threshold
After you make your case again, address the prospect’s action threshold. People mentally run best-case and worst-case scenarios when thinking of buying: If it’s a good purchase, their life will be better; if it doesn’t work, they’ll be out the money and look bad to their bosses and colleagues.
- Someone with a low action threshold will conclude: “It would be game-changing if it works, so it’s worth taking a chance.”
- Someone with a high action threshold will focus on the risk and conclude: “It will likely underdeliver; why throw away money?”
Belfort cites several ways to lower someone’s action threshold to get them to buy:
- Offer a money-back guarantee or a grace period (for example, up to 10 business days to cancel a contract).
- Counter concerns about the hassle of buying: “I’ll walk you through the ordering process. The set-up process is easy too—we train your users, and provide 24/7 support.”
- Reframe their negative scenario: “I agree it’s a big change, but if you’re like my other clients, your only regret will be not acting sooner…”
Raise the Pain Threshold
Belfort says that two-thirds of the prospects who reach this point will buy, but even the few who raise additional objections may be closable if you lower their action threshold by raising their pain threshold.
People in pain are motivated to act. Loop back to the pain or concern the prospect raised during the information gathering questions and call attention to it again—for example, “Denise, I know you said earlier that you’re frustrated with having to deal with print problems on nights and weekends, not to mention explaining them to your boss.” Next, in a sympathetic tone, raise her pain level by agreeing that her worry is valid and asking what she thinks could happen if she doesn’t act now. “Work calls and emails at home are a real hassle. Do you see them declining anytime soon without a change in how you manage projects?”
When she acknowledges she’ll be no better off, respond: “So things aren’t going to get better on their own…the great thing about our software is that it automates so much of the process and tracks every step.” Briefly re-present the key benefits (efficiency and quality) while focusing on appealing to her emotional side (less worry). Use future pacing to help her envision the peace of mind she’ll get from not having to deal with unexpected issues during her off-hours. Then, ask for the order a final time.
|Methods Differ for Handling Objections|
While Belfort recommends looping to dispel objections, sales training advocates a variety of ways to handle objections. The conventional wisdom is that objections are a sign of customer interest and therefore should be welcomed. Sales training often focuses heavily on teaching techniques for handling objections in order to close successfully.
Brian Tracy’s The Psychology of Selling gives typical advice in this regard—for example, if a prospect says she’s “not interested” in your product, counter with social proof or testimonials showing that other people like it. Belfort, of course, argues that objections stem from a prospect’s uncertainty about the product, the seller, or the company; the seller should address objections by deflecting the first ones, then increasing the prospect’s certainty through looping.
In contrast, the creators of the SPIN Selling sales method argue that the seller’s behavior often generates objections, which is why inexperienced salespeople get more objections than veterans. Further, pushing back on objections makes the customer feel pressured and creates resentment. Therefore, rather than handling objections by preparing rebuttals in advance, the salesperson should prevent them in two ways: By not doing things that prompt objections. For example, not focusing on features because this prompts price objections. By using the SPIN sequence of questions to preempt objections. For example, asking “need-payoff” questions focusing on the value of your solution gets the customer to tell you how it will help her, which forestalls objections. Examples of need-payoff questions are: “What about this solution appeals to you?” “How do you think a machine that’s twice as fast would help you?” “What would be the benefits of solving this problem?”The overall SPIN Selling approach is to use the SPIN sequence to build up the problem, and thus the value of solving it with your solution. When the size of the problem aligns with the cost of the solution, objections are less likely to come up.
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- How to sell like Jordan Belfort, the Wolf of Wall Street
- The 4 steps of the Straight Line selling method
- The 3 types of certainty you have to create to make a successful sale