HOW MANY TIMES have you heard a prospect ask, “Can you do it for less?” While this kind of question sometimes signals a serious concern about the price tag, it’s also possible that your prospect is simply negotiating out of habit. Just because a prospect asks whether or not you could lower your price doesn’t mean he is prepared to walk away if you don’t. In fact, objections to your pricing may really signal other concerns that are masquerading in disguise. If you aren’t sure whether the prospect’s supposed sticker shock is a smoke screen or a legitimate concern, ask your prospect to explain his objection in more detail. For example, you might say, “Tell me more about your concern.” After you’ve heard your prospect out, make sure that your prospect has all his cards on the table by asking, “Do you have other concerns?” Once everything is out in the open, you can move forward without feeling like you’re walking through a minefield. You may find that your prospect’s initial financial concerns are masking the fact that he has to consult with the real decision maker, which he may have failed to share with you; or maybe he has a personal friendship with a vendor that would make change uncomfortable. Tackle these kinds of hidden objections first, and you may not have to lower your price. However, if you feel certain that price is the only remaining objection, try asking your prospect, “If I overcome your price concerns, are you ready to move forward?” This prevents your prospect from raising another objection after you’ve dealt fairly with the price issue. Then try these four strategies for overcoming the price objection. Objections to price often mean you haven’t done a good job of selling the value of your products or services. Reiterate the prospect’s needs, and then put a value on overcoming these business problems, including any opportunity costs related to making a slow decision. If your prospect isn’t confident that your products or services will perform, share case studies of how you generated the projected outcome for similar companies, including testimonials. Consider offering a money-back guarantee if you don’t meet performance metrics. If your prospect tries to compare you to your competitors, help your prospect understand that he would never ask his primary-care physician to perform heart surgery or hire a cardiologist to treat a cold. While they’re both doctors, they offer dramatically different services — like you and your competitors. Unless you’re selling a pure commodity, price comparisons between you and your competitors aren’t “apples to apples.” As a last resort, negotiate with your prospect but avoid haggling. You should always have a justifiable reason to discount that you share with your prospect, other than simply that the prospect has asked for it, or you risk damaging the integrity of your brand. Those justifiable reasons might include: a reduction in the scope of services, when customers purchase in volume, when they pay quickly, when they have referred several new customers, or if the likelihood for future business is high as a result of entering a new market or capturing a marquee client. In the end, you have to know your company’s value, own it, and help your prospect see it so you can feel confident sticking to your guns.
This blog was written by RedRover’s CEO & Founder, Lori Turner-Wilson. Read more about Lori and her unwavering commitment to guaranteed marketing results in her bio.