If you’ve ever needed to ask for a marketing funnel budget, I’m going to show you how to successfully ask for a marketing funnel budget confidently, successfully and without appearing rude.
This is also a guide on how to get over customers not wanting to answer your budget question.
Three of the most common scenarios I’m told about, and questions I’m asked, are about budget.
- I sent them a proposal and they told me the budget was over what they expected
- I’m writing a proposal and I don’t know how much to charge
- How do I ask how much their budget is?
Budget is a huge problem in the marketing funnel industry, because there are so many people offering discount rated work. When we talk to customers and ask them “what’s your budget?” they sometimes reply with “we don’t really know. We were hoping you could tell us.”
Asking about budget is a thorny issue for many marketing funnel businesses, because we think that asking about the budget will kill the deal.
How many times have you been working on a project, and you’ve been struggling to price the project, because you don’t know how much their budget is?
There’s a huge misconception that asking about budget will either be considered rude, or kill the deal.
The truth is that you can’t kill a deal by asking about the budget.
Imagine going to a running specialist, and telling them you wanted to run more. The first thing they’re going to ask you is “how far do you want to run?”
If you are unable to tell them the difference between you wanting to run 5K or an Ironman, they aren’t going to be a help you.
You absolutely need to know how much you have to work with. You need to know the resources that you have available to you.
I’ve been in situations where after asking what the budget is, the customer has been hesitant to tell me what their budget is. This is usually because the customer thinks that if they tell me their budget is $5000 or $10,000, then I’ll price a proposal up to the maximum that they have available.
This is a trust issue and usually a symptom of either a) not being a high value customer or b) they don’t trust you enough.
There is a direct correlation between your ability to determine and ask about the budget of a project, and the close rate of your proposals.
If you know that a customer’s budget is $15,000, you are more likely to close a contract with a proposal priced around $15,000. If you know the customer’s budget is $500 you know not to send a $15,000 proposal.
If you don’t ask the budget question, you are going to continue working with low value customers forever. Asking the budget question is the fastest and easiest way, to start weeding out low value, low budget customers.
Where most marketing funnel businesses go wrong, with asking the budget question, is asking it too late.
What happens, is you’ll send a proposal and the customer will reject it because “the budget is too high”.
Which is when we come back with the question “okay well what’s a more reasonable price?”
If the budget is WAY off in the proposal, it’s very hard to come back from that. But that means that you asked the budget question too late.
Pro tip: If their budget is 20% lower than your proposal budget, don’t worry about it. They can find 20%. The difference between $10,000 and $12,000 is negligible. The difference between $1000 and $10,000 is irreconcilable.
Many people think in the wrong terms when it comes to getting the budget wrong. They often believe that pricing a project too high is what could kill a deal. I know from personal experience, and anecdotes that pricing a project too low can kill a deal much faster.
Imagine landing what seemed like the perfect customer. They are in an industry that you want to work with, it’s clear they got a healthy budget and you’re desperate to work on the project. Only for their reply to be “we don’t want to work with you because you priced the project to low and feel you wouldn’t be able to deliver what we need.”
Let’s explore how to ask the budget question successfully confidently and without appearing rude.
The more you know, the easier it is to ask
Why is the alphabet in that order? Photo by Jonathan Simcoe on Unsplash
The more you know about the customer, the project and the market you’re in. The easier it is to ask the budget question.
One of the reasons we are hesitant to ask the budget question is because we are worried that we’ll appear rude. We don’t like the idea of offending the customer and they don’t like the idea of offending us.
The more you know about the project, their current financial situation, and their financial goals, the easier it is to ask about budget.
- How much traffic you get into the site?
- How much of that traffic is converting into email subscribers?
- How many people do you have on your email list?
- How many leads do you have?
- How many current customers do you have?
- What’s the average lifetime value of a customer?
- What’s the average transaction value of a customer?
The more questions like these that you ask, the easier it is to ask about budget. It’ll also give you a more realistic idea of what their budget is likely to be like, depending on the results they give you.
For example, if we’re talking to a lead and they tell us they have 1000 people on their email list, and 100 customers at $1000 per month. It’s reasonable to work out that they have a $100,000 a month income. I would even confirm that work out with the customer.
If I talk to someone who has no list, few customers and a very low income at the moment. Their budget is going to be much much lower than a $100,000 a month customer.
We have to be able to ask every other metric and revenue figure in order to make the budget question easier.
If someone tells you that their goal is to generate an extra $100,000 a year. You know that the budget for that is potentially going to be between $10,000 and $50,000.
So when you ask the question”how much is the budget?” You know that they need to hit a figure between those two numbers. If they then turn around to you and tell you that their budget is $2000, it unlikely that you can help.
Frankly, the budget question and goals question are easily answered by businesses that know what they’re doing. Businesses that are serious about their goals will not only share their goals with people who can help, but tell you the amount of money they want to spend on solving that problem.
If you’re struggling to ask the budget question, ask every other metric about the business.
Stay silent
Silent but deadly. Photo by Kristina Flour on Unsplash
This is probably the hardest skill to learn in the entirety of lead qualification and budget management.
Staying silent.
After you ask the question “how much is your budget?” You need to stay perfectly silent. It could take two seconds it could take 30 seconds.
You need to stay completely silent after asking the question.
Why? Because as soon as it gets awkward, you’ll want to start talking and you’ll end up negotiating against yourself. You’re asking a question, a perfectly reasonable question, and you deserve an answer.
In truth the silence isn’t as long as you think it’s going to be. What feels like 10 minutes, is probably closer to 5 seconds.
What tends to happen is that after we asked the question “what’s your budget?” We not only feel awkward asking but the two seconds of silence feels awkward too. So we start talking again to fill the silence.
We do this to trying work backwards, or reclaim some of our awkwardness. But how do you know that the customer wasn’t thinking about the question?
You need to give them plenty of time to think over the answer, and let them tell you a numerical and fiscal answer.
Get comfortable being silent after you ask the question of the budget. Practice with a friend and ask a question before saying completely silent until they give you an answer.
Be firm that you need to have an answer
Some customers might be shy, or unwilling to give up their budget in the first place.
I would argue that anyone in that position is someone I personally wouldn’t want to work within the first place. But, I also understand that some people are just uncomfortable talking about money.
So when I ask the question “how much is your budget?” They might come back with a variety of answers.
- We don’t really know we were hoping you could guide us
- How much does one of these projects cost?
- You tell us. You’re the expert
These are all “non-answers”. They’re avoiding the question by giving you an answer that is either too vague or turning the question back on you. It’s your job to push past this and be firm that you need to have a fiscal numerical based answer.
Remember our running analogy earlier on? Your trainer needs to know how far you’re willing to go. They need to know how far you’re willing to run. They’ll also need to know how much time you have available to dedicate your training. There will also need to know how much experience you’ve got with your running. Are you starting out, or are you building on previous foundation?
Our first point was to know as much as we can about the business. If someone gives me a non-answer, then I have two options.
First,I can stay silent. If I keep quiet, and don’t answer them back when they haven’t asked me a question, they are more likely to give me a numerical fiscal answer. I’m looking for a number with a $. I’m looking for $10,000 or $50,000. Not “we were hoping you could tell us”.
If I stay silent AFTER they’ve given an answer, it tells them that this isn’t the answer I was looking for. They will then themselves become more awkward in the silence and realise they’ve given me the wrong answer. So therefore they will then give me a financial answer. If after two or three attempts at a non-answer, I will tell them “I need a number”.
I’m perfectly polite, I’m perfectly friendly I say it with a smile, but I’m firm. This is your business, and you should be taking responsibility for the budget your customers give you. Frankly, this is also their business and they should be confident and comfortable with their budgets too.
Second, if they ask me a question like “how much does one of these projects cost?” Then I will repeat what I’ve already learnt about them. I’ll also try to rephrase the budget question.
For example, let’s say I know their goal is $100,000 a year in growth. Their current revenue is $1 million a year. So that’s a 10% revenue growth. I’ll ask them “you want to get to $1,100,000 a year, which is a 10% growth. Does that sound right?” When they reply yes, I’ll ask “how much do you want to spend to reach that goal?”
Rephrasing the budget question can help them see why you need to know. But also repeating back to them their goals will help them understand that you are just trying to help them. You need a fiscal answer. Remember, silence is your best weapon. If someone has given you an answer you don’t like, stay silent no matter how long it goes on for, and they will tell you and answer that you need to hear.
What’s your Corona Money?
Troy Dean from WP elevation has a concept called “Corona money”.
Whenever the concept of budget and project costs comes in, Troy imagines himself sat on the beach with a Corona chilling out in the sun. Taking on business costs you money. It’s a massive unidentified cost to new projects and overheads that businesses neglect.
To take on a new project will cost you money. And I want you to think about that really hard. Taking on a new project, COSTS YOU MONEY.
If you’re sat on a beach drinking a Corona in the sunshine enjoying yourself. What would the number be for the customer’s budget to get you off the beach?
If a budget comes in this $10,000 and you know that it will cost you $10,000 to get the project off the ground, you’ve made no money. Therefore you’re actually better off staying on the beach drinking Corona.
Imagine that. Knowing that a project, when you’re taking it on, leads you to be worse off than having no money. So you might as well have stayed on the beach drinking a Corona doing NOTHING, rather than taking the project on.
You need to know what your Corona Money is. What’s the budget that gets you excited and willing to take on a project?
Explain why you need a budget
Finally you should be able to clearly explain why you need a budget. Use the running analogy above, explain to customers why you need a budget. Some leads and prospects are always going to be resistant to talking about money, goals and budget.
The more you know about their business and the more confident you are about what it takes to launch a project, the easier asking the budget question will be.
You shouldn’t be worried that you’ll offend customers by asking the budget question, they should be worried that not telling you the answer will scare you off.
Marketing funnel budget
“I just feel so uncomfortable asking the question.” I totally understand how you feel, a lot of marketing funnel businesses feel the same when asking about a marketing funnel budget. But what we found, is that the more confident you become in your reasons why you need to ask the budget, and how to deal with all types of answers, you’ll be more willing to ask about the budget.
My favourite part of the process is staying silent. I’ve become addicted to the almost sadomasochistic awkwardness that staying silent after asking a question provides.
The irony, is now that I focused very specifically on a niche, and I know my Corona Money, and I know how much a project costs To get off the ground. Customers are usually willing to quickly answer the question rather than resist.
The more you focus on a niche and market to serve, the less common low budget customers and low value customers who don’t want to tell you their budget will become.
Do you have any budget questions or tactics? Let me know in the comments section below.
