Many companies, sales teams and individuals come to me because they’re very frustrated with one issue. They’re sick and tired of having to “buy” the business by dropping their prices. It seems that there is no industry that’s immune to competitors who will engage in a race to the bottom on pricing. Thanks, Competitors, nothing’s more fun than playing “Who Can Be the Cheapest”! The demoralization continues after the sales person has presented the solution/proposal, and the prospect renegotiates on pricing several times in a row. At some point, rewriting proposals, shrinking margins and covert, pleading calls to sales management for permission to lower the price beg the question “What are we doing wrong?” In 3 words—NO UNIQUE VALUE. The sales professional failed to create unique value during the sale.
When a prospect cannot differentiate your product or service offering from your competitor’s, he has one go-to strategy: PRICE. That’s because price is quantitative and is the one thing that the prospect can use to easily differentiate you from your competitor. It’s quite easy to figure out that $4000 is less than $6500. Therefore if you’re being asked to drop your price to win a deal, you can be positive you failed to create unique value during the sale and did not differentiate yourself, your product, service or company from the competition. Unique Value doesn’t come in bigger or better features and benefits. Unique Value is created when the salesperson positions himself as an expert and a unique resource to the prospect or the prospect’s company. This is what Partner-Advisor Selling is all about. If a prospect wants you to be cheaper, you have not positioned yourself as a partner-advisor during the sales call. Not to mention that being cheap is not good for the sales person’s checkbook or psyche.
Here are some common prospect statements guaranteed to make a sales person feel cheap and reduce the sales process to to a garage-sale-haggling-session:
“I don’t have time to meet with you. Can you just send me a quote?”
“Your competition is cheaper. Why do you cost more?”
“Before you try and sell me something, just tell me how much it costs.”
“Put some numbers together and email me.”
Without a strategy, each of these is extremely effective at making a sales person irrelevant, defensive about justifying his price and vulnerable to price pressure. I’ve heard the feeling described this way: “I’m fed up with being asked to lower my price. I couldn’t get any cheaper if I were wearing a leopard-print miniskirt and standing on a corner somewhere!” Now I don’t have anything against leopard print. It can be an interesting fashion statement; however it’s the wrong way to sell!
SELLect Sales Tip: Leave the leopard print at home. Quit using transactional selling techniques and learn to sell as a Partner-Advisor.
SELLect Sales Tip: If you start discussing price too early in the sales conversation, you lose value.
SELLect Sales Tip: “What we obtain too cheap, we esteem lightly.”–Thomas Paine
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