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15 June 2016

Dealing with the Dreaded Price Objection

Posted By: AIB Business
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In today’s commodity-driven world it is easy to fall prey to discounting your product or service in an effort to capture the sale. However, there are better ways to deal with the dreaded price objection.

First, make sure that you invest sufficient time at the front end of the sales process learning about your prospect’s current situation, problems, concerns, goals and objectives. Although this sounds basic and fundamental, too many sales people skate through this process so they can pitch their product or service. Unfortunately, this is one of the reasons they encounter price objections.

Demonstrate the value of your product, service or solution.  Chances are you spend the first five to 15 minutes of your sales presentation telling people why they should buy from you or giving them background on your company. This approach is one of the LEAST effective ways to demonstrate your value. If you truly want to demonstrate value then you need to tailor EVERY sales presentation so that it addresses the key issues your prospect is facing. Here are two simple steps that will help you modify your presentation.

Step 1: Start every sales presentation or proposal with a summary. This summary must highlight their issues, concerns and situation. Focus your attention on demonstrating that you clearly understand their problem, the impact of that problem on their business, the implications of not addressing the problem, and the value to your prospect and his/her company when the problem is solved. This does not mean talking about your product! You are not actually presenting your solution yet. You are simply showing your prospect that you have listened to them and that you understand their situation.

Step 2: Now it is time to present your solution! Start by showing how your product, service or solution will address the issues that you mentioned in your summary. Start at the beginning and make sure that you clearly demonstrate how the prospect is going to benefit from buying your product or implementing your solution. Please note: you do not accomplish this by simply spouting off features and benefits.

These four strategies can help when discussing price.

Strategy 1: If someone says your price is too high, ask “Compared to what?” This will give you their perspective and help you understand why they think your price is too high. You can then respond accordingly.

Strategy 2: Remain silent. Do not say anything for at least five seconds. In many cases, your prospect will make a statement or concession or even withdraw their statement. It sounds too easy, doesn’t it? Here is the challenge. It is a difficult concept to apply because most people find it difficult to deal with silence. However, if you can condition yourself to become comfortable with these short periods of silence, your results will improve.

Strategy 3: Another strategy is to remove an element of your product or service and then drop your price. Position it like this “Mr. Bloggs, I can lower my price to, or by, this much. Unfortunately, that means I cannot include (whatever you plan to eliminate).”

Strategy 4: If the above strategies fail to work, you always have the option of walking away from the deal. You need to position yourself mentally so you can walk away from any sale. The best way to achieve this is to ensure that you have enough prospects in your pipeline.

Many price concerns can be addressed when you take the time to follow the sales process. However, take a short cut and you will always face price resistance from your customers and prospects.

 

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