A few weeks back I gave you permission to go ahead and sell on price, so long as specific conditions were met and adhered to. One central condition being that you can deliver full “value” at your price.
Ah, value, the ever-present and undefined term in sales, so before going further let’s define value right here:
Definition of Value: Those offerings that remove barriers, obstacles, or helps bridge gaps present between where the buyer is now – and – their objectives!
Buyers will attribute value in your offering if can see, understand, and accept, that it will help them eliminate barriers and/or bridge gaps between where they are now and the objective(s) they are seeking to reach. Absent that you are condemned to sell by adjusting your price, usually downwards, until it is low enough for the buyer to rationalize the relevant value. Of course I want you to do is build relevant value to the point where YOUR price is great value.
Once you master building the value (using the EDGE Sales process and the GAP Selling methodology), you can develop the means and conviction to deliver your price with the confidence and knowledge that it will help your buyer to achieve said objectives.
But let’s be real, even when you execute well, buyers will still bring up price as an objection, it is almost expected, and we need to deal with it.
So there you are cruising down the freeway, armed with the factors above, and hot breakfast in your belly, you are ready to present your proposal. You cover everything and gain agreement on key elements, leaving the price for last, you present the numbers, with confidence, and the buyer pushes back, now what?
First, don’t get excited, if you have executed the process, continue leveraging it, calmly ask the buyer, “OK, please share with me, (tell me) what price (number) you had in mind?” after all, you need to frame what you are dealing with, based on events you had to put a number on the table, it is only fair that you know what number they were working with. BTW, you can often avoid this by establishing their budget, budgeting process, and how they have dealt with budget/cost over runs in the past. Knowing that early, when there is much less pressure can be a real advantage.
When they come back with a number, do be offended, don’t get excited or defensive, a – it’s their number not yours; b – its just a number without context. Instead, politely ask, “how did you come up with that number?” Remember above I said you need to be confident in your number, know why it is that number, know and quantify the value you will deliver for that number; so if you were asked to explain how you arrived at your number you could do it, and with practice, do it easily, so it is only proper that they should be able to explain how they came up with their number. Sometimes they can, in which case you will have to evaluate your options, one of which is to walk away. But in the process of them explaining, you will gain the insight you need.
More often, they can’t explain their number, they either had a number in mind without much back up, they pulled it off the web, they got a price from another competitor, or some other less than relevant source. But without the ability to reason things out, it will facilitate an opportunity for you to review the facts and issue you covered during Discovery. At this point you can decide if you can help them understand your pricing, where their will see an ROI, and make full use of all the impactful thing you uncovered during the Discovery stage. In the end you still have the choice of re-establishing the value or moving on to the next prospect.
- Become proficient in understanding where and how you deliver real value
- Be ready and confident in your price
- Read ” The WOW Approach to Price Negotiations“
- Make sure you have plenty of real prospect in your pipeline so can afford to walk away
What’s in Your Pipeline?