Frager Factor

Monday, July 22, 2013

"You're Price Is Too High"

Photo: Channel Instincts Blog
"If you hear it about 50% of the time it means your priced perfect"

Channel Instincts covered a topic all of us deal with every day when a buyer comes back after a counter offer and says "Your Price Is Too High."

It could mean, “I don’t like you, get out.” It could mean, “I am testing you. I have nothing to lose.” It could mean, “You haven’t shown your value to me.” It could simply mean, “I’ll get a better ..

But it probably means you haven't differentiated your domain -- you haven't established what makes it special, one-of-a-kind, in a class by itself. It means you're one-down rather than one-up. Which is a sure sign that your marketing efforts (if you have any) are not working.

Remember when it comes to proactively selling Domain Names, people hate and rarely understand change. You need to make your name so much more valuable just to get buyers to break out of the familiar and try something different and risk an unknown. 

Here's how Channel Instincts sees it:

What does “your price is too high” really mean?

It could mean, “I don’t like you, get out.” 
It could mean, “I am testing you. I have nothing to lose.” 
It could mean, “You haven’t shown your value to me.” 
It could simply mean, “I’ll get a better price by saying this.” 
It could mean, “I am only doing what you as a salesperson have trained me to do.” 
Hints when selling around price:
  • Don’t fear your price!  Be confident and not ashamed.
  • Know your value
  • Know your competition
  • Know your customers’ needs
  • Never start discussing a price quote with phrases such as:
  • You better sit down before I quote you my price.
  • This is the best I can do.
  • Don’t open your price up to negotiation with leading phrases:
  • You know I want to work with you.
  • I’ve been doing business with you a long time.
  • I sure don’t want to lose your business.
  • I could give you a lower price if…
Never invite or challenge your customer to “shop” your price.  This is what to avoid saying: 
  • Our price is lower than anybody’s.
  • Comparatively speaking, I think we have the best price in the market.
  • Our new price is…
  • Avoid placing yourself in a defeated position on price.  Here are a few examples of what to avoid:
  • Just tell me where I need to be.
  • What do I have to do to get your business?
  • Am I in the ballpark?
  • Of course I could give you an even better price if…
When A Buyer Says…
“I don’t care about service, delivery or quality.  Price is all that is important.”   
Response: “Okay then we’ll provide you poor service and quality products.”  This will put them in a position that forces them to admit their statement is false — they do care.  This will allow you to reinforce your value.
Make sure that the customer has truly earned and justified the price they need.  Make sure you are comparing apples to apples — there are many elements of price — get your facts straight. 
Once price is relinquished make sure you have gained something for the value you provided.  Finally, communicate thoroughly, professionally and always be reinforcing your value.
If you do your due diligence before entering into the discussion? It could mean that the customer is solely focused on price, no matter whether your service or product is a commodity or not, and no matter how successful your argument regarding value, the customer is not open to hearing it. Therefore, establish the customer's criteria beforehand so you know this going into a meeting or discussion. If you know you are solely competing on price, do you want to engage in a price war or not? 

If the decision will not be made solely on price, the discussion is now open for you to present your reasoning behind the value of your offering. Also take into consideration, buying is partially dependent upon as Tina says: trust and if the buyer likes you.

If You Lose The Sale?
Recording an opportunity as ‘lost’ due to price is in fact not a legitimate reason. The legitimate reason is either 1) we did not educate the prospect well enough as to our value proposition; or 2) the prospect wasn’t ours to have in the first place. What they look like in terms of size, workplace strategy, decision makers, annual revenue, buying criteria, etc. – allows us to hone in on prospects that are more likely to recognize and respond favorably to our value proposition. Not every prospect may be in a position to be our client, and may find a value proposition that focuses on low-price/lesser-quality to be more suitable.

Thanks to Channel Instincts, LinkedIn's Chief Marketing Officer Board and to all of you for "listening." 

About The Author: Owen Frager is an Internet marketing expert ready to help take your company to the next level.

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