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What if I told you that a venture leader’s attitude and response to rejection can make a huge difference in the success or failure of their enterprise. Would you believe me? Well believe it. It’s true! Let’s look at 3 very clear examples of this phenomenon. Eleven publishers rejected J.K. Rowling’s “silly” book idea about a magical boy with a scar on his forehead before one finally green-lighted it. Oprah Winfrey was fired from her first television job and Walt Disney was fired as a cartoonist. All three of these folks obviously went on to great success, but a critical component to that success was how they dealt with the rejection and objections they faced in the market.
Rejection is a very big part of success, but it never feels very good. The number one rule in handling objections and rejection is DO NOT take it personally. Obviously, this can be extremely difficult to do, because the person who is putting forth the rejection may in fact be reacting to you personally. But the key for YOU is to NOT react negatively.
In that moment of rejection, let the rational part of your mind take over. Use their objection as an opportunity to learn. Put on your scientist white lab coat and treat the objection as an intellectual exercise. What is the lesson to be learned from this rejection? Ask the who, what, where, when, why and how questions. Learn that lesson and move on! If you can do that, you’ve moved closer to a yes and success like the examples above.
As I like to say, “I’m not a psychologist by education, but I play one as a venture leader!” Here are 6 approaches that I share with all venture leaders to help them understand and analyze objections and rejections better, and more importantly over-come them.
Who Are the People Saying “No”?
Understand WHO the objection is coming from. This will provide you with the key context information that will help you process the objection and determine how to handle it.
Things to consider:
- What is this person’s title?
- What level are they in the organization?
- What is their role in the organization?
- What is their role in the purchase process?
- How will they be using what the venture produces?
- What is their background and perspective?
By taking all of these “who” questions into consideration, you will have a better picture of the personality from whom this objection is arising. This is the key to understanding the basis and foundation for their objection and it will provide you with the opportunity to address that concern.
For example, if your venture produces a software product, which you’re trying to sell to a client and an objection comes to you in that discussion from the administrator of the existing system. Look at what the perspective of that current system administrator is and then you will have the answer to their objection. In this case, you need to address the anxiety and concerns the current system administrator has with moving to your new technology. If you do that, you will win them over and the deal.
What is the Actual Problem?
Now let’s consider the WHAT. After you’ve considered who is giving you the objection, be sure to take the personality out of it and really try to dive into the heart of their objection to get to the WHAT of the objection. The goal is to completely put yourself in their shoes with their perspective and wrap your head around the WHAT of their objection.
You may not like what you see or hear or even think when you’re “inside” their head trying to understand the WHAT of the objection. But, until you really honestly do this, you may not fundamentally understand the nature of their objection and therefore can’t truly address it. I can assure you that most objections will rear their ugly head again in the future; take the time to understand them now so that you will be prepared to address them again and again and again in the future.
By pulling your emotions out of the equation and deeply understanding the WHAT of the objection, you will see the real issue and be able to solve it then and there. As you think about the WHAT ask yourself:
- What is this person thinking?
- What is their perspective?
- What could be driving them?
- What are they really saying?
- What are they asking me?
- What are they really telling me?
Where is the Objection Coming From?
Next consider the WHERE question – you’ll want to think about where in the marketplace this objection or rejection is coming from. Let’s identify the problem from the industry or vertical perspective.
All industries face their own set of challenges and obstacles in the market. When you consider the WHERE question think of the following:
- Which industry or vertical is the objection is coming from?
- What is the issue with this particular industry?
- Where are the pain points in this industry?
- Where can the vertical’s issues cause concerns for my product?
You may conclude that your product doesn’t really work for the industry in question, and move on to another vertical where it may be more applicable, or you may conclude that you need to obtain references or external analyst approvals to sell into that industry and roll that into your future product plan.
Another aspect to the WHERE question comes from the geography. As you’re considering this aspect of WHERE ask yourself these questions:
- Where in the world is the objection coming from?
- What is happening in this geography?
- What are the geo-political ramifications for my product?
- How does this affect my ability to sell into market my product?
Geographical locations make a big difference in the value proposition, adoption and even conversion to a winning sale. Certain countries, states or other regions have regulatory constraints that impact the adoption and sale of your product. Based on this information, determine where to focus your sales efforts and which markets to address in the future.
Next consider the When
Think about the WHEN or the timing of the objection. Understanding this aspect may help you overcome the objection at hand.
- What is it about the timing of this customer’s objection that I’m missing?
- Is it the wrong time for them to buy something because they are doing poorly in market right now?
- Is it the wrong time of the year for this customer?
- Is it the wrong time in the customer’s budgetary cycle?
- Is it the wrong time in their buying process?
- Did they just buy a competing good or service?
Once you identify the WHEN objection, you’ll be equipped to address this issue and potentially convert that objection into an acceptance. For example, if the client is in the middle of preparing next year’s budget, work with them to position your product or service in the next budget year, rather than trying to shoe-horn yourself into the existing budget. If a customer has just purchased a competing product or service that you feel is inferior to your own, then offer your own best practices or key takeaways from implementations that you’ve completed for other customers. This goodwill investment from you may help the customer in their own implementation or might even open the door to your goods or services down the road.
Now think about Why
When you look at the WHY, you are wanting to understand the reason, rationale and thinking behind the objection. For this exercise start by assuming that the other person has a completely reasonable, rationale, and logical objection. Your job is to figure it out and to articulate it in clear terms that reasoning, so that you completely understand it. Once you think you know why, you will want to verify your hypothesis with the potential customer to ensure that you are correct.
Understanding WHY can be a painful, time consuming activity but it is a must. You might be asking “Why do I have to do this Jit?” Because you need to learn the last and critical piece of the puzzle to determining how to address the objection and potentially overcome it. Oftentimes by articulating the logic or rationale for the objection to those objecting, they themselves may question their objection. Those instances are particularly satisfying and fun! So shed the light of reason and logic upon a false objection and see what happens. Don’t be defeated or deterred if some objections can’t be overcome. That is a normal part of the process.
Finally, Let’s Look at HOW
HOW do you overcome an objection? Some of you may have tried to jump ahead to this area, thinking that this was the only and perhaps most important part of objection handling. Candidly, nothing could be further from the truth. If you don’t do the hard work of the first 5 steps in objection handling, you’ll never have the data, information and analysis to determine how to defeat the objection and you will find that your rate of success in resolving objections is very low indeed.
If you do your homework, you’ll be able to address the objection in a clear, comprehensive and, perhaps most importantly, decisive fashion. Now let’s pull all of your research together to determine HOW to overcome the objection. Think about who the person is and how that affects their objection and their decision making. Analytically, coolly, calmly, think about what the objection is and use that logic to figure out HOW to neutralize it.
Consider which aspects of WHERE might be relevant to the objection and HOW you will use those to overcome it. As the saying goes, “timing is everything,” so bear this in mind as you consider the WHEN aspects and then think about HOW to close timing as an objection. Finally, use your understanding of WHY to eviscerate their objection(s) however you choose.
Remember that not every objection can be overcome, but this exercise will teach you an awful lot more about your venture, your product, its market and future success. Even when you’re not able to overcome an objection you learn how to better target your venture to the right VC, customer, market or use case and that paves the path for even greater success moving forward. Remember this was the same model that J.K. Rowling, Oprah and Disney used.
Like what you’ve read, or not? Have a question or a topic to suggest? Want to get another perspective on an issue or challenge you’re facing? I welcome your questions, comments, feedback and insights below or feel free to email me directly here. Please read and share all my blogs at LeadingVentures.com.
About this blog – The goal of this blog is to share my experiences, to capture and reveal valuable insights, and to draw from my serial entrepreneur-ship through 7 ventures over the past 20 years. I have encountered many impressive entrepreneurs along the way and I hope to share our collective experience with you to help teach and perhaps motivate you to launch your own B2B or B2C enterprise.
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