Last post we discussed why — in most situations — everyone loses when selling on low price alone. The suggestion is to sell on value, not on price.
I received a question: “What percentage of buyers do you think buy on price?”
While I don’t have any figures, I’m not sure the question itself is correct.
Why?
Because, if you ask people what their determining factor is in the buying process, many (not all, but many) will tell you it’s low price. Yet, the results are often quite different.
Have you ever walked into a store determined to buy something simply on low price and come away with a better, more expensive product and were happy it worked out that way?
Most people will answer yes. And, it was most likely the result of good salesmanship. No, not in selling a person something they don’t want or need. Rather, finding out if what the customer wants is really the cheapy brand or something of higher quality. And, a professional salesperson determines that by asking questions and listening.
Of course, not everyone claims low price as their ultimate buying value. Personally, I tend to buy more on convenience. Others I know buy on style. Still, others buy on what they believe will most impress others. I’m sure there are other reasons, as well and I’m not judging any of them. I’m also not implying, or saying that any of them is the correct reason.
I am saying that “low price” is often what people think is their determining factor when it usually isn’t.
The Point: don’t come down on price thinking that is what is going to make up your prospect’s mind. Sure, they’d like the lowest price they can obtain from you in exchange for the most value they can obtain from you. Who can blame them? All else being equal, that makes great sense.
For reasons explained in the previous post, however, we know that selling on price alone will hurt both you and your prospect.
So, as a sales professional, don’t get sucked into thinking that what you automatically need to do is lower your price. After all, they’re not buying on price…even if they really believe that is their motivating factor.
Bonus thought: If you are a “price buyer” then you will most likely believe your prospects are, too. Your inclination will then be to focus on low price. And, you’ll be surprised when they still don’t buy from you (unless you’ve luckily come across another true price buyer). The same for whatever type buyer you are. So, remember…your buyer is not you.
Find out what’s important to them, not to you. And sell based on what they value.
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As usual Bob, this is great advise. More so, it is timely advise. Monday I will put on a new hat: Business to Business, door to door marketing. Renee and the boy’s will handle the operations aspect. Any other help would be appreciated (LOL).
Joe
Bob you are so right in your assessment. Great advice. Generally I go for quality over quantity. However I also go with what works best for me.
Phillip: Thank you! And, yes, there’s a time and place for most everything.
Joe: Keep in touch and let us know how it is going! If I know you, you’ll knock it outta’ the park, continuing to serve many people with the excellent value your company provides. After all, there’s a reason your company won that great award!
You are absolutely right Bob. I sell personally and when the client doubt – always ask, which one would you compromise – quality, service or low price. Guess what wins? Thanks for reiterating it.
Mercia: Thank you for sharing that with us!
That is so absolutely right. While we all intend to save money by buying at the lowest price possible. But we hardly want to compromise on quality. Most people, when it comes to choose between value and price, if they can afford, will not compromise on value.
Thank you for this terrific advise and this series of posts. Absolutely, this is one of THE BEST advises one can get on this topic.
Kumar: Thank you. What very kind feedback. Very appreciated!
Thank’s Bob for this GREAT article!!!
I think you are absolutely right about finding out what is of value for them. I’m doing a course for the local authorities in the town where I live. In connection with another asignment I have for them, I talked to one of the leaders, and she confied in me, some trouble and conflicts they have as leaders, and I offered to tailormake a course for them. I’m almost finished with all the materials now, and we have talked more times along this process. She loves what I put together for them, so much that she wants to participate in the course herself. SO it’s not untill now price has come up, and is not an issue for them. I offered something of value to them – THAT was the important thing. It’ll be a lot about controlling your thoughts by weeding out the ones that does not serve you and replacing them with positive ones. I made a drill for that, so they get reality on IT WORKS!!! I’m so excited about it 🙂
Lene: That’s awesome, my great friend. And, the fact that there was no price objection says that you have built up sufficient value (or, that you are undercharging, but I’m hoping it’s the first one) 😉
It’s the first one I’m always focussing on Bob! It’ll be a 1 day course with 10 to 14 leaders, and the price will be then between 20000 to 28000 danish kr., that will be aproximately 3500 USD to 4600 USD before VAT. That’s OK I think. 🙂
Hi Lene, I’m not qualified to know either way. Only you can know that. If you feel great about it, that’s what counts! I’m totally sure you’ve got it covered. And, congratulations on your new client! I’m so impressed with all you have been doing since first coming across you on Social Media!
Thank’s Bob! Now you mention it – so am I (LOL) – But I tell you the reason is that I DO take the advice from you, Randy Gage, Art Jonak, Orrin Woodward to mention my favorites 😀
Well you know how powerfull stuff comes from Randy Gage!!! I have every single article, video and so forth he made, and what have made the HUGEST difference for me is getting rid of limiting beliefs and replacing those with affirmations that serve me. My abilities have not changed, I just started believing in ME. A short while ago I found a core one on the wrong side of the fence 🙂 and replaced it with “No matter what I touch I am successful” For ME that one has SO much power. I have a blog I started about ½ a year ago, don’t remember exactly. Before I found that limiting belief, I got 1 to 2 comments a month. After I found it and replaced it with the positive one – I get around 80 comments a DAY. And I did not add or change anything on my blog – but I changed ME and my mindset. I really LOVE you guys for sharing your experience and advice – THAT HAVE CHANGED MY LIFE – Thank’s 😀
Lene: 🙂 🙂
In my opinion, the last sentence in this blog is key.
I had a mother of my bride call me, and she spoke in an upset tone, explaining, that she found that same dress for $600 cheaper than what I sold it to her daughter. “…and that’s the regular price.” She exclaimed.
I said, I wonder how they stay in business and give good service at that price? I told her I base my price on the service I will give her daughter, and if I charged less than what I charged, I could not consistently provide that kind of service.
I offered her a full refund so she could go buy it at the other store, but she decided that it is worth $600 more, for her daughter to be treated the way we treat brides. At each of her daughter’s fittings, the mom said she was glad she stayed with us.
Amy, I LOVE that. YOU, my friend, just summed up the last two posts perfectly!!!!!
Thank you Bob. Had it not been for the courage you have helped me stand on, I don’t think I would have even charged that extra $600. Now I charge more and I KNOW I give more in value. 🙂
Thanks for this article that is excellent as usual! I particularly like the bonus! I had exactly that thought when reading the previous article!
Loic: Thank you for your kind words. So glad you enjoyed it, as well as the bonus thought.
Well said, Bob. Perhaps buyers who claim lowest price as the determining factor really mean: ‘lowest price was the only thing that differentiated this product in my mind’. When buyers perceive no difference between our product and the competition other than price, we have truly become a commodity. Okay if you’re selling generic brown rice. 😉
Robin
@robindickinson
Cheeky biz toonist 😉
Robin: You bring up a great point. While I was actually speaking in terms of, on a general basis, what would most people claim is the determining factor they buy on, your comment took it from a different angle; if they were asked afterwards what their determining factor *was*. And, I agree with you completely. If, afterwards, they determined that the differentiator was price and price alone, then indeed, they saw no other differentiator of value. Terrific point. Thank you for sharing!
Great post Bob and it really caused me to wonder after I visited a popular site where professionals can post job or service opportunities and contractors can make their proposals. In this case I was shocked to find a large majority of these contractors were offering their services at less than minimum wage. How many people have lowered their value of themselves and are willing to accept poverty pricing? In some cases the poster didn’t suggest what low to high hourly rate they were willing to pay and I still noticed very low bidding. Is this present economy really influencing others to lower their standards and place less value on their experience and knowledge? That is a very troubling trend to me because being in the training and people business you want people to understand their value and worth, yet it appears the mentality is to the contrary. Yet I know people personally who have raised their service price and are doing exceptionally well.
Kathleen: Terrific points. I’m in agreement with you. That’s one reason why I published this brief, two-part series. It all (in my opinion) comes down to whether one believes they are a commodity or a valued resource.