Overcoming the Price Objection -- Part II
By Michelle Nichols
Avalanche! That's the best way to describe the deluge of responses I received after my initial column about overcoming the price objection. I found 72 great ideas in your e-mails. I heard a symphony of suggestions on how to survive those dreaded words, "We think your proposal sounds wonderful, but, gee whiz, the price is too high." (See BW Online, "Overcoming the Price Objection".)
Let's face it, there isn't a single, surefire, works-every-time answer to the price objection. If there was, I could bottle the magic formula and make a fortune. Fact is, there's just too much variety in the people we encounter, their business situations, and the hot-buttons that prompt the decisions to sign those purchase orders.
FRUITS OF EXPERIENCE.
Besides, a professional salesperson is something of an archer: When objections arise, you don't want to have just one arrow in your quiver to shoot them down. Ideally, you would like to have six -- or six dozen. Just knowing you have a variety of responses to this pivotal challenge will pump up your confidence levels. Even better, that knowledge also produces the ultimate payoff by increasing the size of individual sales and their overall numbers. What follows are some highlights of the wisdom that Savvy Selling's readers shared in response to my first column:
If it were put to a vote, the hands-down winner would be "sell value, not price." This answer came in two flavors -- building up the value of your product or service, and being able to provide a competitive comparison. To maximize the perceived value, make sure your customers understand that it's not just a widget or widget-improvement service they are buying, they must also consider the research and development that went into the product, the ongoing support you will provide, the certainty of on-time delivery, your company's history and reputation, and its market knowledge. Taken together, those factors are worth a lot -- but only if a rep takes the time to educate the customer.
One example of extra value came from a reader Rich, who stresses the many and costly certifications his foundry has obtained. Smaller competitors often can't afford them, but those certifications are vital to his sales strategy because they provide implicit guarantees of the quality control that customers can expect.
US vs. THEM.
Comparing the total cost of your offering with those of competitors is a strong strategy, but one that requires a cool head and thorough preparation. The comparison can be based on your product's features or its return on investment. Either way, it establishes common ground between you and your customer, as you both try to see which total package best suits the client's needs and overall situation.
A word of advice: Don't try building a comparative, competitive matrix on the fly. Instead, practice with your manager or a sales colleague before unveiling it before a customer. Although this is an excellent way to qualify a customer and then close a sale, chances are that you will only get to that point if you are in full command of all the facts before deciding to go down this particular road. Don't overlook your customer's personal weighting of the various points of comparison, not everyone puts the same value on different components of a total package.
The first runner-up among reader responses in the quest to overcome the price objection was selling a solution, also known as "consultative selling." Using this strategy, the first call or calls are aimed at getting the customer to "paint the landscape," as reader Bob puts it -- or just for information gathering, says Toni, who writes: "If you can discover what the underlying purpose is, and the product/service fits like a hand in glove, price becomes a secondary, or even less, of a priority."
The responses brought several variations on providing service. For example, Budd tells his customer that while any joker can compete on price, he competes on service. A reader who signs himself "Dr. Danny" takes this idea one step further: "The price includes my personal service to you. No one in the world can provide my personal service but me."
Another reader stresses the quality of the relationship when selling financial advice to businesses. How can a company put a price on a key strategic relationship, he asks potential clients, when that counsel and guidance may save their business from disaster or raise it to the next level?
One time-tested strategy is getting the clients to convince themselves. Scott asks his clients which brand-name products they buy for personal use, and then says the same concept applies to his line: They're buying quality and should expect to pay a premium. Likewise, Web designer Joe recalls an encounter with a home-remodeling client who said he could get his outfit's online site designed for $500. Joe's immediate response: "And I can get a few high school kids to remodel my kitchen for $6 an hour." That message sure sank in. After a long pause, the client said, "When would you like to meet?"
A jeweler has a particularly interesting tactic for handling the price objection: He parrots it back as a question, "So, you think the price is too high?" Then he remains largely silent while buyers grapple with the price issue. Often, he says, customers talk themselves into buying the beautiful new bauble -- the same one they first seemed so reluctant to take home.
PINING FROM THE FIORDS.
A reader in Norway had an intriguing concept. He recommends fostering desire, not need, which becomes a secondary justification for the purchase. Might work, but the product you happen to be selling would need to suit the strategy. Speaking personally, I have never been overcome by a passionate yearning to sign up for a new copier or facilities-management services.
Amazingly, as one reader tells me, even folks who sell parachutes encounter the price objection. Here's a product that stops falling from the sky like a stone -- and people are still worried about saving a few bucks! This just proves the universality of the price objection.
Let's face it, the price objection is here to stay. However, you don't have to stay at your level of competency in handling this hurdle to success. Just remember, information itself is practically worthless. It's the implementation of that information that can make your sales soar. Study these responses and practice the ones that suit your industry, personality, and client profiles. Then get out there and use them on real customers. Happy selling!
Michelle Nichols is a sales speaker, trainer, and consultant based in Houston, Tex. She welcomes your questions and comments. You can visit her web site at www.verysavvyselling.biz, where you can order her new CD, 72 Ways to Overcome the Price Objection. She can be contacted at Michelle.email@example.com