Have the Budget Talk With Prospects Now and Thank Me Later
I’m a big fan of asking budget questions early. Why? Because there’s nothing worse than going through a whole sales cycle and finding out you’re way out of step with your client when it comes to the bottom line.
I found this out the hard way as a kid. My friend and I were shoveling snow during the winter and had just landed a gig doing a very large gravel driveway. The whole time we were talking about how much money we were going to make from the job, but when we held our hands out to the homeowner he had a different idea. Needless to say, we made sure we discussed our fees beforehand from then on.
Most people don’t like talking about money straight off the bat, and I get why. It seems inherently impolite, pushy, shallow, and generally off-putting, but finding out this crucial information early will save a lot of time in the long run. There is, however, a right way and a wrong way to go about it.
Keep the Question Open-Ended
Asking “what’s your budget for this” often isn’t effective because people a) don’t know what their budget is, or b) haven’t figured it out. About 75 percent of early stage prospects aren’t sure of their budget in my experience, so I like to instead test the range by rephrasing the question as open-ended. I ask “Do you have a budget in mind?” and once they respond I can give them a range of what they might expect to spend if they work with me.
In my last company we sold CRM consulting. Our typical engagement was $300,000 with a range between $50k and $1 million. After we got a prospect excited about our approach, I’d let them know that typical clients of their size spent x amount of money with us.
Instead of asking them about their budget (unless they told me otherwise), I’d let them know how much similar clients spent. Frequently, it showed that we weren’t a good match. That actually makes your life easier because, I don’t know about you, but I’d rather find that out early before I shoveled their whole fucking driveway.
Salespeople, Try This: Be Transparent
A marketing company I know called Captora comes right out with their pricing from the jump. They sent me the email below after I asked about their service:
Hey Adam!
Thanks for reaching out. I enjoy seeing your tweets and can see you’re also connected to our Co-Founder and CEO Paul Albright. I’m happy to schedule some time to walk you through the Captora Platform, but did want to be transparent from the beginning. Our pricing varies from $XXk-$YYk per month depending upon services, applications, users, etc. So we normally see companies over 150 EEs investing in marketing automation as our sweet spot.
Below in my signature line is a brief 2 minute video of the Captora Platform so you have an idea of what to expect. But like I said I’m more than happy to schedule some time to walk you through it. Just let me know how you’d like to proceed.
Cheers
Pricing is very transparent these days. Even Yesware, one of my favorite companies that I use to manage my email, advertises their pricing on their website. Why shouldn’t sales guys follow suit? It’s a tactic that saves time for everyone involved by better qualifying prospects.
Having the budget discussion early on saves time and prevents frustration for everyone involved. Keep the question open-ended and you’ll be racking up the perfect prospects in no time.
