5 Ways to Prevent Price Objection
March 2009"Your price is too high!” The infamous price objection. Wouldn’t sales be a great profession if we could somehow wipe it out and never hear it again?
Unfortunately, that will never happen. Too many of the people with whom we deal are paid to get the best deal they can. That means asking for a better price, even when they know they are getting a great deal. Human nature being what it is, it is only natural for many people to try to get the best price that they can.
That being said, it is still possible to reduce the number of times we hear it. Perhaps more importantly, it is possible to reduce the intensity of the comment. In other words, we may still hear it, but many of our customers won’t mean it as intensely as they once did.
While you can’t control your customers, you can control your behavior. And many times it’s your behavior that prompts the customer to ask for a discount, or find a way to lower your bid. By changing your behavior, you can impact the customer.
Here are five specific strategies to help you prevent the price objection, by focusing on your behavior.
Look like you are worth more. Your appearance impacts the customer’s subconscious view of your value. If you look like you don’t value yourself, it is natural for the customer to assume the same about your product or your work.
I will never forget a salesperson for one of my clients who came to see me, concerned about the pressure his company was putting on him to get results. He chewed tobacco and had the yellow teeth and spots on the leather vest he wore to confirm that. A wrinkled pair of blue jeans topped a pair of dusty cowboy boots. He looked like a reject from a consignment shop. His appearance screamed "cheap.”
If you look confident, competent and successful, you send the subtle message to your customer that you, and your offering, is worth a little more. You just look like you are less likely to discount your price in order to get the job.
The construction dress code may differ by region, but practically speaking, you should dress like your customer—only a little better. Project a demeanor of a successful, confident salesperson.
Believe in your price/value relationship. Do you believe that your offer represents a good value to the customer? If you don’t, it will be difficult for you to convince the customer of it. You don’t have to believe that your product is the best or that your company is the best. You just have to believe that it is a good value, giving the customer his or her money’s worth. More people buy Fords than buy BMWs. It’s not about being the best; it’s about a good value.
This can be difficult if you, in your personal life, are a bargain shopper. If you refuse to pay the asking price for anything and won’t buy it if it’s not on sale, then you’ll have a difficult time convincing your customer to pay the full price for what you are selling.
Your core beliefs will influence your behavior and be communicated to the customer in a number of subtle ways.
To counteract that tendency, carefully examine the offer you are making from the customer’s point of view. Do whatever it takes to convince yourself that it is a good value to the customer, worth every penny the customer will pay.
Don’t inadvertently sow the seeds. Sometimes we can blindly sow the seeds of discontent with our stated price by our poor choice of language. For example, when we say things like, "This is our best price,” "This is list price,” or other such terms, we immediately convey to the customer that there are other, lower prices, available.
We have inadvertently encouraged the customer to ask for a discount. The word "price” doesn’t need an adjective to describe it.
Don’t advertise your willingness to discount. Sometimes, out of eagerness to make the sale, you might advertise your willingness to make price concessions in order to secure the business. You say things like, "We’d be happy to discuss pricing with you.” Or, "We may be able to do better.” Or, "If you give me the last look, I may be able to sharpen the pencil.”
I was shopping for office space. As I looked through one location with my real estate agent, I asked the listing agent what the lease rate was. He told me the rate but in the same breath said, "But we’re willing to work with you on that.”
After hearing that, why in the world would I accept his original terms? He broadcasted his willingness to discount, and I’d be foolish not to take him up on it. By broadcasting your willingness to get the deal, you encourage the customer to ask for price deviations.
Be careful about ever discounting. If you discount your prices in response to a customer’s request, on even one occasion, you have conveyed to the customer the idea that your quoted price is not your final price. Now, forever in the future, the customer will remember that you can discount when pressed. He will, therefore, press for discounts.
If, however, you never discount from your quoted price, you convey that there is some integrity in your pricing, and that you are quoting him your best price from the beginning.
It’s OK, on some occasions, to walk away from a piece of business rather than to discount in order to get it. The net impact is that the customer respects your pricing, and is less likely in the future to ask for a discount.
If you get almost every deal, your prices aren’t sufficiently high. You need to lose some in order to gain the customer’s respect as well as a sense of where the market price is.
I’ve often thought that the idea of asking for the opportunity for a "last look,” which most salespeople strive for and proudly proclaim as proof of a good business relationship, is merely another way of saying that you’ll discount the most. Why would the customer give you a "last look” if he wasn’t expecting you to discount some more?
It is so easy to complain about the customer and the constant pressure to reduce your prices. It’s the thoughtful salesperson who understands that your own behavior can often be the cause of the price objection.
Change your behavior, and you’ll improve your results.
Dave Kahle, The Growth Coach, is a consultant and trainer who helps his clients increase their sales and improve their sales productivity. Kahle has trained thousands of salespeople to be more successful in the Information Age economy. He is the author of more than 500 articles, a monthly e-zine and six books. You can join his "Thinking About Sales Ezine” online at www.davekahle.com/mailinglist.html.
For more information, or to contact the author, contact: The DaCo Corporation, 3736 West River Dr., Comstock Park, MI 49321; firstname.lastname@example.org; www.davekahle.com; phone: (800) 331.1287 or (616) 451.9377; fax: (616) 451.9412.