"Most of the people we've approached told us
they had no budget to hire us."
This topic popped up when I was leading a strategy session with a video production duo the other day.
They were feeling puzzled and slightly defeated. I empathized as I knew these guys have been gun-ho about going after new leads to create more opportunities for their business.
Good news is, this is something you can fix. Here, I'm going to show you how to tackle “no budget” objections. In a way, THIS IS THE GREATEST INDICATOR that you need to revisit your outreach strategy. You are lucky to face this problem (that you can totally fix.) So, read on.
"Budget" is such a mysterious term. It sounds legit, but it can also be highly subjective.
For some, “budget” can be something that is concrete where it is clearly mapped out on a spreadsheet either for the entire fiscal year or for on a quarterly basis and allows no exceptions (so they say, and you’ll find out why I sound a bit sarcastic later in this post.) For others, "budget" is just the go-to excuse to say "no" without saying "no."
Another mysterious phrase that is equally used to turn down offers is, "I can't afford this right now."
"Affordability" and "budget" are, in my humble opinion, highly subjective bullshit words. I am only saying this because I have used these terms to turn down offers, and I was very intentional as to why I said this to someone.
In most cases, others use these terms somewhat unconsciously just to get rid of all incoming offers they don’t feel like analyzing & digesting. (Note: I did not say they don’t have time on purpose. People have time for anything they truly want. They just don’t want to work for it by thinking, researching & analyzing to figure out what’s “possible” for their business or for their lives.) Nonetheless, these all lead to the same place – A big, fat, “NO.”
If you can relate to this common hurdle in business, let’s fix this together right here right now, shall we?
What are they really telling you?
First, let's decipher what they are really saying to you so that you understand why your current approach is not working well.
Here is the clear and blunt version of what they are telling you:
"What you are offering to me is not compelling enough to go out of my way to pay for it."
In other words, they simply don't see the value in what you are offering, or they have other means to get it cheaper elsewhere.
Can you see an iron gate shutting right in front of your eyes in slow motion with heavy squeaky sounds? It's discouraging, isn't it?
Well, there's no need to be deflated. This does not mean your lead generation effort goes down the drain completely. By the end of this post, you will know exactly what to do to reopen that heavy iron gate with one finger.
3 Major Reasons Why They Don’t Value What You Are Offering
This has a lot to do with your current approach.
1. Your conversations are “feature-heavy.”
2. Your conversations are too logical and rational.
3. Your offers come across as “nice-to-have” offers.
Your Conversations Are “Feature-Heavy”
You are too focused on what it (whatever offer you are presenting) does and not focusing enough on what your prospect will get in return as a reward.
I have heard a few people use the same analogy of a luxury car salesperson. Say, you are at a BMW dealership and a high-closer salesperson will not tell you about how high quality the leather seats are, how big the monitor on the dashboard is, how much horsepower it has, and how great the brand new sleek ergonomic design it incorporated.
Instead, he or she will tell you, “Take a spin. Feel the power. See it for yourself.” After all, it claims to provide, “An Ultimate Driving Machine,” isn’t it? This approach gives a “free pass” for this sales person to get to the core motivation as to why you are toying the idea of purchasing/leasing a BMW.
So, what is your core motivation in this case?
Power, control, validation from others (that you are able to afford a BMW), a positive perception that it gives by owning it (especially if it’s a hybrid), etc.
Notice these are all “rewarding feelings” that some people crave and desire.
Many SaaS startups tend to make this mistake. Granted, they are proud of all the features they can offer through cutting-edge technology, and they are dying to tell the world about it. Instinctively, I would even be attempted to do the same if I get caught up on a “geek out” mode. But, if they fail to explain how their products can transform people’s lives, they would be closing fewer sales. Or even worse, they will experience a huge churn.
Your Conversations Are Too Logical and Rational
“Eat your vegetables!”
Nowadays, savvy young moms know better. They wouldn’t repeat this as if it’s a mantra. But, many of them might stop at explaining benefits of eating vegetables.
A kid will ask, “Why?”
His mom replies by saying, “Because it’s good for you. Your body needs it.”
He will then go on to ask, “Why is it good for me? I hate vegetables. They don’t taste good.”
The mom has choices here. She can say something like, “You see, vegetables have lots of vitamins and fibers that help your body grow taller and stronger. Candy bars don’t do that.”
OK, this makes sense. It’s logical, for sure. Who wouldn’t want to grow taller and stronger?
You may have noticed this already, but this logical explanation does not give this mom a “free pass” to tickle her son’s core motivation. Kids know they are growing out of their clothes each year (because their moms are sighing about it), so subsequently, they know they are growing. For them, it’s not strong enough evidence to endure the pain of eating up not-so-great-tasting vegetables. You agree?
What if she tells him this instead:
“Vegetables are loaded with all sorts of good stuff that help you grow faster and stronger. Don’t you want to score some goals at the next soccer game and win? Your teammates will go crazy over that!”
“Wow…,” the kid goes on to imagine him making that goal in slow motion while his teammates are jumping, cheering and shouting with joy. He is a star… Now he can connect the dots between nasty vegetables and him being the hero at the next game… They don’t want to grow stronger, they want to be popular!
I’m sure you get the point.
Here’s a realistic example to tie this all together.
Just go to www.quickbooksonline.com
QuickBooks Online is a cloud accounting system designed for small to mid-size businesses. What if Quickbooks landing page just talked about the benefits of keeping clean books? I bet your reaction would be:
“Yeah, yeah, yeah, we all should eat better, sleep better, and exercise more. We all should keep our books in order, too.”
Not enough motivation there to overcome a potential switching cost. Right?
But, when you go to the site, what do you see? You see videos featuring brave small business owners doing what they love, and they are killing it. It’s inspiring. I am sure some visitors resonate these images by overlapping themselves with the business owners featured on the video clips. They can connect the dots between dry, boring bookkeeping tasks and them crushing it with their business as a result.
Your Offers Come Across as “Nice-to-Have” Offers
Let’s now go back to the original reason which motivated me to write this post. As you recall, it was about the video production duo getting shut down by “no budget” excuses.
Videos are replacing traditional ads with still images. Facebook Live, Insta Stories and Video-based ads are all the rage. Social Media strategists and branding experts can’t stop talking about it day in and day out.
Despite all the hype, many still consider professionally done video productions as “nice-to-have” items and sitting at the bottom their to-do list although big brands as well as small business owners are cozying up to the idea of generating video contents.
But, if you flip the script, you will see there are many upsides for businesses like video production agencies.
First, there is much less resistance because prospects do understand the basic benefits of generating video content. Second, what they offer is tangible & measurable where prospects can easily see what is possible for their business as opposed to other services i.e. insurance, legal and finance that position themselves as “preventative” services for incidents that have not taken place.
I am all about “turning obstacles into opportunities.” This is the reason I am known as the “counter-intuitive” strategist. What is intuitive for these guys to do is to put an emphasis on “increased eye-ball (traffic)” or “great promotional tool” by creating video content. Unfortunately, this is where they get shut down by “no budget” excuses.
So, how can these guys shift their conversation from “nice-to-have” offerings to “must-have” offerings?
The answer: Explore ways to directly tie video content with what their prospects truly desire = money.
Increased traffic with no sales conversions is meaningless. An increased number of followers and likes by those who will never buy or collaborate i.e. JV, press, other exposure opportunities are meaningless.
The formula here is: Video Content = Increased Revenue
They do, however, must be able to back it up legitimately with metrics and success stories (case studies.) They can also highlight ways that video content can be cost-effective for additional revenue generation.
When someone presents an idea that will help prospects bring in additional revenues, the word “budget” goes right out the window. If the increased revenue is substantial enough to cover the original cost of a new strategy or a tactic, then what’s the holdup? Hence, the budget becomes a weak excuse.
I have seen business owners doing exactly this. They talk “budget” on regular basis, then something enticing comes along (new revenue generating opportunities or something that boosts their ego), it gets approved with lightning speed. “Budget” is highly subjective, and that’s why I was sarcastic in the opening of this post.
Remember that people buy homes. If buying a home is a representation of success, security, dream and desire, they will FIND A WAY to finance it even if it means they will be tied down with a mortgage that lasts for the next 30 years. Their “budget” will evolve around it to make do.
So, I will say this again, “budget” is highly subjective. This means we all have a chance to turn things around!
The Magic Blueprint to Overcome “No Budget” Objections
Here is the blueprint that you can work on to get your hands on that “free pass” to your prospects deep desires.
1. Learn by listening to your prospects explain the situation they are in, what they want to accomplish and why.
This is the part that takes time. But, it is well worth spending as much time as it takes to get to know your prospects because, in many cases, they will not tell you their struggles and challenges from the get-go. (Would you?) You are building trust, and there is no rushing with this process.
2. Reiterate what they just told you AND convey your services are the missing piece to achieve what they strive.
It is vital to pay close attention to “how” they describe their situations. Once you learn more about what they desire, you can reiterate it by repeating it back to them. Then talk about how your services can help them achieve what they desire.
3. Ask them to describe a scenario where they don’t achieve what they desire.
This is something that is not practiced often. It is easy for us to tell prospects what would happen if they don’t have a good plan for what they are aiming to achieve. However, this is not effective. As an alternative, you ask them to describe what would happen when they don’t achieve their goal. It will include missed opportunities, money left on the table, and being lost to their competitors which will threaten their livelihood.
4. Connect the dots: Now switch the gears to discuss their desires being fulfilled and what they will gain from this experience.
This becomes a reassurance of how important it is for them to focus on their goals with your services being part of the picture. Also, it is important for you to learn how they word what it would look like so that you can incorporate it in your continuous conversation with your prospects.
5. Offer real-life examples to solidify why it has to be you to do the job and not the other options.
At this point, it would be effective to have 2 to 3 different offers to present as it helps prospects to evaluate their options with you. The reason it should not just be 1 option is that our brain is programmed to look for reference points to compare offers. If you give them just 1 option, there is nothing else to compare your offer with.
6. Kill the objections by demos and samples.
Your prospects may not be immediately convinced that taking up your services is the way to go. There are 2 main objections – time and money. This is where, by then, you are prepared to connect the dots from where they are now to where they can be.
7. It’s time for you to say, "So, if you agree, this seems like a priority for you. How soon do you want to get cracking on this?"
Obviously, you don’t have to use this exact phrase. Tweak it as you see fit. After you say this, there is no more talking. You have helped them paint the picture that you are confident you can deliver. It’s time for them to make a decision.
What if they really don't have money?
Then you are selling to the wrong market. But even then, if they see your solution will free them from the pain they are feeling, they will scrape money together.
One way or another, they will come up with money if they want it so badly.
Are you feeling bad that they do? If so, let me ask you a question:
"Are you fairly confident with your ability (or your team's ability) to remove their pain & struggle and replace it with measurable results that will make them feel euphoric?"
If your answer is yes, why should you feel bad for them scraping their money to be saved by you? You shouldn't because they will make more than what they pay you, and they will be delighted to work with you. Right?
If your answer is no, you may be offering "nice-to-have" solutions they can live without. In this case, it's a bigger problem than just overcoming rejections.
Keep in mind that even luxury items or services can be viewed as "necessities" for some. It is up to you and your team to strategize ways to “connect the dots” to make a decision-making process easier on your prospects. Be savvy about using metrics, visuals, stories to stimulate their curiosity and imagination for what seemed to be unattainable to attainable.
Ultimately, resolving “no budget” objections relies on your ability to paint a picture that your prospects crave and desire. This is what moves the needle in your business, and for this reason, it is imparative to devote your energy to continue crafting your strategy.
If you are unsure as to how to apply the blueprint to your business, feel free to reach out to me.