“Our standard price is $200…”
Whenever we play card games, we never reveal our cards to our opponent and at the same time we will try to ‘read’ our opponents cards. By abiding to these two simple rules we increase our chance of winning the game. Similarly in selling our products, there are two things to avoid if you’re ever going to sell at premium price. Sales people who sells at premium price are aware of these two mistakes (sometimes even subconsciously) and they avoid them at all cost. Unfortunately, almost all the rest of the salespeople are neither conscious nor subconsciously aware of them, and therefore don’t even realize that they are committing them.
Let’s take a look at these 2 errors to see how they can negatively affect your sales results.
Error #1: “I think so too.”
This error happens when salespeople thinks and agree with the prospect that their price is too high.
Our actions and words often project the thinking that we have. This mistake happens when salespeople communicate somehow, someway to their prospect that they believe that their own price is too high. If you communicate that to your prospect, you can bet that person is going to hammer you on your price. Almost all salespeople commit this error of “I think so too” to varying degree. All of us do at times. But good salespeople break themselves of this habit very, very quickly.
To illustrate this point, let’s consider this. Say if you were going to buy a second hand car, would you be willing to pay the sticker price for the car? It shouldn’t surprise you to learn that virtually everyone we have asked the questions say they would negotiate the price of any second hand car. Now let’s ask the same question but change the subject. If you walk into a Cartier boutique, will you try to negotiate the price of the diamond ring that you pick? Why is it that most people would plan to negotiate on the price of the second hand car but most people will never bother to negotiate in a Cartier boutique?
The answer is simply “training.” The reason why we beat up the car salesperson’s price is because they have trained you over the years to do so. For decades, car dealers have educated their buyers to think that their price is too high and they are willing to negotiate their price.On the other hand, you will almost never negotiate in a Cartier boutique because the salesperson will always say no to you and perhaps even give you the “dirty” look. In our selling scenario, the “I think so too” error may be the very simple, seemingly innocent things that you say that sounds like this “well you may want to consider paying $800 for this,” Or “think $800 would be too much?” Or the infamous sales line of “well our non-promo price is $800” If the salesperson says any of those things, they have clearly signaled that personally, they feel that their own price is too high. When prospect receive that signal, guess what? They are going to hammer on the salesperson like a drum!
Error #2: “I am willing to negotiate price”
The number one thing that most salespeople should do yet don’t do very well is talk price. As a salesperson, no matter what you sell, you must fully expect that a smart prospect will challenge your price.
Most salespeople don’t like to talk about price. And, if they do, they don’t discuss it credibly, comfortably and confidently. To prove this point, simply asking your salespeople this question: How comfortable are you talking about the price of your products or services? From our experience each time we ask this question only 10% of salespeople will raise the issue of price proactively with customer. 90% of salespeople will rather wait for the customer to raise this question. Furthermore, almost half of all salespeople, when directly asked price by the customer, will change the subject and start talk about something else by saying something like “I’m going to come to that, but let me tell you about the wonderful feature of this product (service) first.”
You can deftly defer price and there is a reason for it. However you must do it confidently and at the right time. We called this handling premature price questions. This type of question is very common and yet most prospects really want to know the price to make a decision. If you are not in a position to quote a price because you haven’t had a chance to create value in the mind of the prospect, you must learn how to delay quoting a price with confidence. The best way to do this is to tell the prospect you will be able to provide the exact price, based on their specific needs, requirements, volume, and parameter once you and they determine exactly what they need. Alternatively you could give them a range in which most purchases fall.
Has it ever occurred to you that one of the first things most prospects do is to purposely attack you with premature price questions? That is because they’re getting a read on you. They are trying to find out if you believe in your price and if you are willing to negotiate. If you are communicating to your prospects that you are willing to negotiate your price, they are going to do just that!
Your invitation to negotiate your price downwards almost always sounds like this; “Now, you know I want to help you on this Gary,” or maybe something like this “Esther, you know you’re one of my most valuable customer and we really want to do business with you again.” Or, “Let me relook into my numbers and see what I can do for you.” Or “We’ll work something out here that will be easier for your budget.” Or “What will it take for us to get your business?” Or the infamous “Let me talk to my boss and see what we can do for you.”
Any salesperson who says something like that is telling his or her customer, “I am open to negotiate my price downwards. Let’s reduce my price!” The point is when someone first asks you about price, never respond with a negotiation. Got it? You have to hang in there. If you want to sell higher than competitor, you will have to ask price higher than your competitor. You have to learn to acknowledge the reality that your prices are higher than competitors and proceed with the full expectation that you’ll make the sale at that price.
Acknowledging that your price is higher than your competitor must be done tactfully and diplomatically. And it CAN be done successfully!