In the history of recorded time, no customer has ever said, "Your price is too high," and meant it. Even though it is the most frequent objection that salespeople hear, it simply isn't valid. So, when a customer says this, what are they really trying to communicate? It can be a number of things, such as:
- "I don't perceive the value to be higher than the cost."
- "I don't see any difference in your offering and your competitor's offering."
- "I don't think my problem is as expensive as your solution."
You will notice that the word price does not appear in any of these responses. There are two ways to sell: commodity selling, where all offerings are presented the same, with the sale normally defaulting to the lowest price, and value-added selling, where the customer perceives a difference between the offerings and makes the buying decision on cost, not price. The relationship between cost and price is an inverse one. The item with the lowest price tag typically costs the most, in the long run. Consider a shirt sold for $40 or one sold for $8. While the price difference is obvious, the actual cost is lower for the shirt that will last longer, look better, feel better, etc. Selling is a science, not an art. As such, successful selling follows a process. There are five principles behind a value-added sale. When used effectively, you can overcome or even eliminate the price objection.
P—Positioning
Begin by talking to the right person. Many purchasing agents use price as the primary differentiation. Instead, identify the person or department that will benefit most from what you are selling and sell to them. Find the right person, then ask the right questions.
L—Listen
It is amazing what people will tell you if you just ask. The secret to successful selling is the ability to ask the right questions in the right way to determine the customer's real buying criteria. It is virtually impossible for the human mind to ignore a question. Use inquiry to engage your customer's subconscious mind and make an impression. Stop talking, ask questions and listen.
U—Unique
What really makes your product, service or organization unique? If someone asked you what made your product or service different, what would you say? Though your levels may be far superior, words like quality or service will not set you apart—how many of your competitors are using those same words? This simply dilutes the value of the differentiation. What really makes you different?
S—Solution
Value-added selling takes solution selling to the next level. It still begins by asking some version of a common question, such as, "What are the top three problems facing your business right now?" However, it recognizes that customers will rarely know. They will answer with something like, "Our sales are down," "Our attrition is too high," "Our manufacturing costs are up." Unfortunately these are only symptoms of the problem. The value-added sales professional recognizes this and takes two more steps—qualifying the problem by asking the customer how and when the problem manifests itself, then quantifying the cost for each manifestation. The end result is a clear understanding, on both sides, of what the real problem is and what it is costing. When the salesperson quotes their price, it is in comparison with the real cost of the problem it will solve.
H—Help
Helping means doing everything the customer asks—and then some—and getting credit for it. Known as the extra mile, it is probably something your organization is already doing. Your customer may not appreciate your extra efforts because they do not know you are doing it. Brag about yourself. To overcome or eliminate the price objection, talk to the right person and ask the right questions. Demonstrate which of your specific differentiations are most viable for them. Then justify your higher price by quantifying your value. Keep your customer and earn referrals by going the extra mile.
