Starting today I am adding a new category of articles: Objection Handling. We will first understand the basics of objection handling before we go specific objections. Handling objections is not merely having a smart response. It requires knowledge, a specific attitude, a technique and the right communication skills. To develop on these lines we first try to understand why customers raise objections.

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Customers have not understood your presentation

The first reason why customers raise objections is that they have not understood your sales pitch. You may have something at the back of your mind when you say something in a sales interview. Objections are usually raised when your thoughts on how you understand the issue are not the same in the customer’s mind or the customer’s mind is not as intensively involved in accepting that point. The way in which you understand what you told them, is not the way in which the customer understands. For example, you have told them that by investing in an endowment product they will get Rs. 15 lakhs (at current bonus rates) after 15 years. By making this statement in all probabilities you assume that the customer’s need for managing the higher education expenses of his or her children will be provided for and the customer understands this as well as you do. In order that the customer understands this in exactly the same manner as you do, you have to spend adequate time discussing the dreams of the parents for their children’s higher education. Simply mentioning that the policy will provide for higher education is an insufficient preparation of the customer’s mind. What we mean by understanding here is the ability of the customer to look into the future, realize that higher education costs need to be planned for well in advance and develop a desire to save for it. This level of understanding is different from making a statement that higher education needs are to planned for and that a particular policy will solve the problem. The problem has got solved in your mind, but the solution is elusive in the customer’s mind. You have to get the customer to Desire the solution not simply to buy it. When the desire is not created, many objections follow.

Build Adequate Professional Trust

The second reason why objections are raised is that the customer has not developed sufficient professional trust on you. Since we sell in a market where the prospects are known to us, there will exist a personal trust. As a person you will be accepted and prospects will be willing to enter into a purchase discussion. But personal trust and professional trust are two different things. You are selling an intangible product, that cannot be seen, felt, smelt or heard. You are selling a product that is a promise to be fulfilled on the death of customer or if he survives the policy term, a promise to be fulfilled at the end of the policy term. This requires the customer to reach (in his mind), a level of professional trust that assures him or her that the policy benefits being discussed will accrue as promised.

In order to gain the professional trust of the customer you need to spend adequate time with the customer discussing his or her needs. More than one meeting may be required. Discussing the customer’s needs before pitching a product is a very important part of the sales process. Usually agents start a sales interview by talking about a product. When you discuss products before discussing needs, objections are many. Sometimes so many that you may not be able to handle them. Another important reason why professional trust is not achieved is making tall claims or talking adversely about competition or mentioning data/ figures/ statistics, without adequate documented proof. Your presentation to a customer should be practiced and 90 % of it should be the same with all customers, if you want to reduce objections or the severity of objections.

Develop inter-personal and communication skills

The third reason why objections are raised is the inter-personal communication skills you possess produce objections. You may have come across persons in your daily life who are argumentative by nature. Such persons get into an argument very easily. The objections raised by customers are a direct result of the words, the phrases and sentences you construct and the manner in which you deliver them to the customer. For example, very often in your anxiety to convince a customer you say things in prematurely. You want to tell the customer that the bonus rate on the product being described is very high. If the bonus rate is not a part of the discussion, suddenly propping the point of bonus rates, will lead the customer to confusion. Any confusion in the minds of customers leads to objections. Though your point on bonus rates may be a valid one, preparation of the customer’s mind to receive the point in an appreciative manner is more important. It is therefore very important to develop a presentation, write it down and sufficiently practice it at home before using it in the market. A prepared presentation will allow you to confidently present your case to the customer and will reduce the number and intensity of objections.

Develop your knowledge on a daily basis

The fourth reason why objections are raised by customers is when they perceive that the agent sitting in front of him or her is not knowledgeable enough to discuss financial planning. Many agents face this problem especially when objections are raised on the returns of a life insurance product or on the returns of a mutual fund. Sometimes agents also face situations where in a discussion on higher education, or retirement, where if the customer feels the agent;s knowledge is below par, customers will raise objections that are designed to stall or stop the process of selling. It is therefore very, very important for the agents to constantly educate themselves either by attending training programs or by regular reading (or watching relevant educational, not motivational, videos). Earl Nightingale, a very successful international coach, once said: “One hour per day of study in your chosen field is all it takes. One hour per day of study will put you at the top of your field within three years. Within five years you’ll be a national authority. In seven years, you can be one of the best people in the world at what you do.”  In life insurance sales, there is no substitute for knowledge. You must prepare a list of things you should learn and spend one hour daily reading on those topics. Fortunately, today there is Google, almost everything is available on your smart phone or laptop, all for free. Part of that one-hour per day you can also spend on this Blog www.helpindiainsure.iistpune.in.

Work on the Basics – Daily

Handling objections is therefore not always about having a smart response to an awkward point made by the customer. While it is important to know how to respond to an objection, it is more important to work on the basics of handling objections. You will then enjoy the objections and feel a sense of pride in handling objections in the right manner. You can also form a group of agents, meet once a week for 1 hour and only discuss how to handle the objections each one of you has faced during the week. When different persons/ agents give different ideas, your own skill of handling objections improves as will your confidence of handling the customer on objections. Everyone in the group will benefit.

Happy Selling! More on the basics of objection handling in my next article.