Need skills to negotiate with gold-digging customers

Need skills to negotiate with gold-digging customers

We are finding that many customers today are savvy negotiators and they are tough to deal with. Do you have tips for how to negotiate with customers who are bent on taking the company to the bank?

 

Myra’s answer to Need skills to negotiate with gold-digging customers

I remember a time when it wasn’t even necessary for customer service professionals to have negotiation skills. But we are living in different times. Today, customer service professionals must be astute negotiators, able to reach resolutions that balance the interests of the customer and the company.

Here are 4 quick negotiation skills to help your team keep both the company’s customers and money when dealing with “gold-digging” customers…

1. Ensure the decision makes good business sense. All resolutions offered should not only retain the customer, but also be smart business decisions. For example, does it make good business sense to waive $125 in NSF charges for a bank customer with one personal account? Would it make good business sense if this were a customer who kept an average balance of $35,000 in the bank?

2. Consider different levels of resolutions for different levels of customers. Perhaps waiving $125 in NSF fees for a customer with only $50 in an account isn’t a good business decision, but is it smart if the customer also has 2 car loans, a mortgage loan and an annuity with the bank? (In our customer recovery consulting practice, we help clients develop a service recovery matrix for different levels of customers. For example, resolution strategy ‘A’ would apply to a customer holding one account and strategy ‘C’ would apply to a high net-worth customer with multiple accounts.)

3. Know when to give in. USA Today carried a story that headlined, “Bank gets $2 million lesson.” It began when a customer tried to get his parking slip validated at a bank in Spokane, WA to save 60 cents. A receptionist refused, saying he hadn’t conducted a transaction. The customer asked to see the manager, who also refused to stamp the ticket. Appalled, the customer went to the bank’s corporate office vowing to withdraw his 2 million plus dollars unless the manager apologized. No call came. “So the next day I went over and the first amount I took out was 1 million dollars,” he says, “But if you have $100 or 1M,” he says, “I think they owe you the courtesy of stamping your parking ticket.” Breaking the “no stamp” rule here would have led to a loyal relationship with a high net worth customer. Part of negotiating is knowing when to give in.

4. Don’t let customers push you into a corner. Never agree to a resolution you’re uncomfortable with. Get comfortable with saying no when that’s the right answer. One of my favorite responses to upset customers when I’m up against a wall is, “We see this differently, and I am going to have to put more thought to the perspective you have shared with me. It’s helpful for me to understand how you see things. In the meantime, here is what I can do to solve the immediate problem.” Equip your team with negotiation skills and you’ll put less revenue at risk, keep more customers and build the esteem of your employees in the process.

What Cuba Gooding’s Character in “Jerry Maguire” Can Teach You About Negotiation

Last week I asked my Twitter network for movie clip ideas for a Negotiation class I teach for a university. I wanted to find movie clips to strategically and perfectly illustrate my 3 Golden Rules for Negotiation. My network came through big-time with more than a dozen fascinating clips. After reviewing each of the clips, I found 3 perfect clips to teach my students to go in with leverage, know your BATNA, and to know when negotiation is not an option. My students laughed and learned. Here’s what I shared with them.

  1.  Go in with leverage

Jerry Maguire “Show Me the Money”

I used this clip to illustrate to my students the importance of leverage in negotiation.

In the movie, Cuba Gooding’s character, a wide-receiver about to become a free agent, wanted one thing: to make serious cash. And he made sure his agent was crystal clear on his goal by way of his famous line, “Show me the money!” His leverage came from clarity about his purpose and by bringing value to the table.

Gooding’s character stepped up his game by improving his attitude and taking his performance from mediocre to spectacular. This leverage paid off big time: He obtained a four-year, $11.2 million contract-up from a previous three-year, $1.7 million offer. By improving leverage, Gooding’s character got Jerry Maguire, the agent, to show him the money. Enjoy this clip from one of my favorite movies. (Warning: explicit language)

 

2. Know your BATNA

Firefly “The Negotiator”

One of the most important things for any negotiator to understand is their BATNA: Best Alternative to a Negotiated Agreement. BATNA is the course of action that will be taken by a party if the current negotiations fail and agreement cannot be reached.

You have power when you have a walk-away alternative.

When my husband and I were negotiating the price of our current home, we agreed, before meeting with the realtor, that we would offer no more than “X” amount. If the seller couldn’t meet us where we were, we were going to walk away from the deal and seriously pursue another fabulous home just 3 miles away. That’s an example of a BATNA…it was a real, viable option for us that didn’t require agreement from the realtor. We had power because we had a real walk-away alternative.

Be careful not to just walk away without doing your research because the consequences could be serious as shown in “The Negotiator” scene here:

 

3. Know when negotiation is not an option

The Fifth Element “Send a Negotiator”

My husband and I actually watched this movie on cable last weekend. I used the “Send a Negotiator” scene to demonstrate that there are times when you don’t want to negotiate.

Remember Kenny Rogers’ song “The Gambler?” There’s pure wisdom in these lyrics:

You gotta know when to hold ‘em,

know when to fold ‘em,

know when to walk away, and

know when to run.

In negotiation, you have to know how to set limits, know when to walk away and know when it’s just not in your best interests to negotiate. In the “Send a Negotiator” clip below, Bruce Willis’ character demonstrates the Golden Rule, knowing when negotiating is Not an option. Take a look.

 

Myra’s Helpful Phrases for Negotiating with Customers

Women with headsets working at a call center

Here are 13 great phrases to help you negotiate with customers you can’t afford to lose…but in cases where you don’t want to “give the store away.”

  • “We see this differently, and I am going to have to put more thought into the perspective you have shared with me. It’s helpful for me to understand how you see things. In the meantime, here is what I can do to solve the immediate problem.”

  • * “It is our company policy that we cannot pay a claim that involves consumer error. We have a responsibility to the company to uphold the integrity of our products. When a product performs as expected and has no deficiencies, we cannot take responsibility and accordingly can offer no financial assistance.”

  • “I am hearing you say you want $500 in pain and suffering. Please tell me how you arrived at that figure?”

  • “That sounds a little high.”  Note: No matter what dollar amount the customer puts on the table, just state those five words and then shut your mouth. Since most people become increasingly uncomfortable with silence, your tight lips will force the customer to say something in response. Either he or she will make a more reasonable request, or they will attempt to justify their request.

  • “This is fair and reasonable because…”

  • “I’m willing to _________ because____”

  • “As a concrete form of apology, please accept this coupon for 10% off of your next purchase with us.”

  • * “We appreciate hearing about your experience, but we cannot compensate you in this matter because you failed to follow instructions/did not read instructions/misused the product.”

  • “I understand your concern. What do you think would be fair?”

  •  “Although you might not agree with my decision, I’d like to explain it so you can at least understand.”

  •  “Let me do some investigating on my end and call you back. I’ll call you no later than tomorrow afternoon with a response.”

  • “I’ve/We’ve given this a great deal of thought, and it’s the best I/we can do. Any more and it’s not worth it for me to do the deal./Any more and this simply won’t make good business sense.”

  •  “Mr. Warren, we want to get to the bottom of this just as much as you do.”

Now you can give your representatives even more great skills for delivering the best customer experience and for handling difficult customer situations. Sign up for my email list and learn specific tips, approaches and phrases to help your employees help your customers.

Is it wise to “split the difference” with a customer?

Q.My customer service representatives have two customers really – the end user customer and the franchisee — and we have to keep both happy. Often, when we reach an impasse, we offer to split the difference with the customer. For example, when the customer is wrong and we don’t owe them a refund, but they are still every unhappy and argue that our policy wasn’t clear, we simply offer to split the difference to get them off of the phone. Would you recommend this or do you think we should seek other solutions?”

Myra’s answer to: Is it wise to split the difference with a customer.

Splitting the difference with customers in deadlock situations is quite common in the customer service world, but I do not think it’s wise and here’s why.

Splitting the difference is essentially making a concession. It’s important to only make concessions that are carefully thought out and to make them strategically. Every concession sends a message to your customer. Here’s what I mean:

Quick concessions undermine the credibility of your initial offer.

Large concessions tell the customer a lot more can still be conceded before your bottom line is reached.

Small concessions tell customers your bottom line is not far off.

If your people quickly offer to spilt the difference, you are undermining the credibility of your organization and beckoning the customer to ask  you for even more. Additionally, splitting the difference is not likely to improve customer satisfaction or bring the customer back.  I’d focus on giving your team skills to negotiate effectively with customers and to assertively draw the line on consumer error.

I think your team might benefit from an on-demand webinar I recorded recently, entitled How to Negotiate with Customers: 10 Strategies for Negotiating with Crafty, Cunning & Unreasonable Customers. Get the details on this on-demand recording right here.

The Secret of Socrates

 

How to get irrational customers to think rationally

 

The diplomatic communicator builds a psychological path toward an affirmative response by strategically getting their “opponent” to say “yes” a number of times.

Get the customer to say yes and keep them, if possible, from saying “no.”

When a person says “no,” all of their pride demands that they remain consistent with themselves. And it is very difficult, once they’ve said ‘no’, for them to change their mind and become “agreeable” with you, because their sense of pride is now involved. And we invest so much in our pride.

Let me give you an example of how this works:

Years ago when I was heading up consumer affairs for a car rental company, I had an escalated call from a very upset customer. The customer was demanding that the company pay him three thousand dollars and some change because our mishap caused him to be three hours late to a meeting. He explained that he was a consultant and his billable rate was $1,000 per hour.

The problem was our fault; there was no way around that. But the demand was unreasonable, and I knew we weren’t going to be able to give in. So, I used the Yes, Yes strategy on him…and here’s how it worked.

“Mr. Jones, you are an astute businessman, are you not?”

 I knew he’d say yes, as he boasted proudly that his clients paid him $1,000 per hour, for his services.

Next, I said…”And, as an astute businessman, I’m sure you only make decisions that make good business sense.”  “Absolutely!”, he said.”

I knew I had him, because I had built an affirmative path. Each of the questions I asked him yielded a positive ‘yes’ response.

So, finally, I said. “I am quite sure that if you were in my shoes, talking to a customer in this situation, that you would not simply give a customer three thousand dollars, because they experienced an unfortunate delay.”

After about three or four seconds, he said, “Ms. Golden, you’re right. If I were you, there’s no way I’d give a customer three thousand dollars for waiting three hours.”

It was that easy…and it will be that easy for you!

Build an affirmative path by asking your customer two simple and obvious questions that you know will result in a YES response. It’s very much psychological…your customer won’t feel comfortable disagreeing with himself…and will feel compelled to say yes so that he agrees with himself!

7 Secrets for Moving Customers Out of a Hardball Mentality

 

Here are 7 proven tips for moving customers out of a hardball mentality into a constructive dialogue.

  1. Confidently acknowledge and address anger.A big mistake among customer service professionals is to ignore a customer’s expression of anger or tip-toe around it. There is something known as the communication chain. When people communicate, they expect the person they are communicating with to respond or react…this response is a link in the communication chain. A failure to respond to communication leaves the communication chain unlinked…broken.For example, If I walk into my office and say… “Hello Sherry, how are you?” ….and she says absolutely nothing, she’s broken the communication chain. And that leaves me feeling awkward, perhaps embarrassed.If a customer expresses anger and we fail to respond to it, the communication chain is broken and the customer feels like they are not getting through. The customer might become even angrier and more difficult, as they are resorting to whatever it takes to feel heard and understood.

    You can keep your angry customers from getting angrier by confidently acknowledging their anger and responding to it. You can respond to anger with a statement like, “Clearly you’re upset and I want you to know that getting to the bottom of this is just as important to me as it is to you.” This statement directly and professionally addresses anger – without- making the customer even angrier. Now that the anger has been acknowledged, you have completed the communication chain.

  2. Allow the customer to vent, but don’t lose control.An Angry customer can be compared to an erupting volcano. When a volcano is erupting, there is nothing you can do about it. You can’t speed up the eruption, you can’t put a lid on it, and you cannot direct or redirect it…it must erupt.When a customer is angry, they must experience and express their anger – and often this is done through venting. We should not interrupt an angry venting customer or tell them to “calm down.” This would be as futile as trying to tame a volcano. A volcano erupts and eventually subsides. Your angry customer will vent and eventually calm down.Always let angry customers vent. In most cases, your customer will only need to vent for fifteen to thirty-five seconds. Venting beyond 35 seconds can become ranting and cause you to lose control. After a few seconds of venting, you’ll want to jump back in and move the conversation forward constructively.
  3. Don’t react emotionally.It can be easy to lose our cool when a customer gets hot, but be warned: In most cases, showing frustration, impatience, or acting even mildly upset doesn’t help you move the customer out of a hardball mentality. Usually, losing our own cool does nothing but make the customer even more upset or our attitude will make the customer even firmer in his original position.If you feel you’re beginning to lose your cool, don’t be afraid to hit the “pause” button. You hit the pause button by putting a customer on hold or telling the customer you will call them back.
  4. Heed Steven Covey’s Words…Understand, then be understood.In The 7 Habits of Highly Effective People, author Steven Covey tells a story of a patient going in for an eye exam. After briefly listening to the patient’s complaint, the doctor takes off his glasses and hands them to the patient and tells the patient to simply “take his glasses where them.”What are the chances you’d go back to a doctor that prescribes a solution without even diagnosing a problem? You don’t have much confidence in someone who doesn’t diagnose before they prescribe… But how often do we prescribe a solution before completely diagnosing the situation, in dealing with customers?Seek first to understand. Before you try PRESCRIBE a solution for a customer’s problem, before you quote policy or tell a customer what you cannot do, seek to truly understand the customer’s viewpoint. How has the problem impacted your customer? Has your customer lost money, time, respect, or confidence because of this problem? Does the customer feel embarrassed, wronged, discriminated against, or powerless? Try to really understand what your customer is experiencing and feeling. when you respond, communicate your full understanding of the problem from the customer’s perspective. Only then can you truly diagnose, BEFORE you prescribe a solution.

    Listening with the intent to understand gives you empathy for the customer and puts you in the position to solve the real issues. Once you really understand your customer, you naturally begin to communicate with empathy and to communicate more effectively. Your customer, who feels understood, can now begin to understand you.

  5. Don’t belabor your point…no matter how right you are.be•la•bor – [bi-ley-ber] – verb: (1) to assail persistently, as with scorn or ridicule (2) work at (something) repeatedly or more than is necessary: He kept belaboring the point long after we had agreed.If you really want to tick a customer off or incite an already upset customer, belabor your point. Repeat your point (your policy; your position) over and over again. I mean really badger the customer with your elementary explanation so that the customer feels they aren’t too bright.
    Customer service professionals all around the world make the mistake of belaboring a point when speaking with customers. Don’t let this happen to you. Simply make your point once diplomatically and then enter into a constructive dialogue with your customer.
  6. Get the customer saying ‘yes’, and if possible, keep them from saying ‘no’.When a person says “no,” all of their pride demands that they remain consistent with themselves. And it is very difficult, once they’ve said ‘no’, for them to change their mind and become “agreeable” with you, because their sense of pride is now involved. And we invest so much in our pride.Here’s how it works. Build an affirmative path by asking your customer two simple and obvious closed-ended questions that you know will result in a YES response. Once you do that, the customer will be on an affirmative path (with you) and it is far easier for them to agree with your next question. It’s very much psychological…your customer won’t feel comfortable disagreeing with himself…and will feel compelled to say yes to your third question so that he agrees with himself!
  7. Have a graceful exit.When all else fails, you need a way to gracefully get out of a conversation with a difficult or unreasonable customer. Here’s a simple way to gracefully exit: “We see this differently and I’m going to have to put thought into the perspective you have shared with me. I will visit with my supervisor about your concerns and call you back with a response.”

 

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Myra Golden

The one to call when you’re tired of losing customers because of rude or poor service.

Myra Golden teaches a customer service transformation system that helps service professionals create warm experiences, surprise and delight customers, and completely restore customer confidence after any service failure. Over 90% of the organizations using the system realize measurable improvements in customer retention rates, customer satisfaction levels, and document drastic reductions in the amount of money it takes to resolve customer problems.

To bring one of Myra’s dynamic, transformational workshops to your company, visit http://www.MyraGolden.com