When your customers are overly concerned with price, they’re delivering this message: 

You haven’t differentiated your product or service from the competition.

Price is seldom the dominant factor in buying decisions. Customers are far happier when they buy value — the combination of quality, service and price — than when they buy on price alone.

Here are two key rules about price objections:

1. Selling is not about giving the lowest price — it’s about offering the best value. The subjective nature of value makes it difficult for you to quantify and measure. It’s not a one-size-fits-all approach.

2. Price competition can be a fool’s game. How many times have you agreed to a low price because a price-cutter was undermining you? If you lose the order, you’re angry because you’ve been undercut. If you win, your profit margin may be too low or even cost your company money.

Responding to price objections

Being responsive to price objections isn’t the same as agreeing. Here are some helpful tips:

• Understand the value you offer to customers. You can’t believe in your pricing until you believe in the value of your products or services.
• Build selling confidence. The best pricing strategy fails unless you have confidence in the selling process and an ability to defend it. Confidence comes from knowing the value of your products or services.
• Remember who you are. Customers buy results. An important goal for you is to identify where and how your products or services are better than the competition’s.

Creating value

When creating value, you have three main tools — claims, features and benefits. Combined they create an extremely effective approach to selling value. Here’s how:

• Claims are subjective. They’re most useful for generating interest because they reflect the salesperson’s enthusiasm
• Features describe a product or service. They are factual, objective and specific.
• Benefits are perceived advantages to the customer. Benefits include savings of time and money, and increased profits and productivity.

Training tip: Ask your salespeople to pick one of your products or services and describe it using a combination of claims, features and benefits. Work their comments into a presentation and subject each person to the following four-step presentation test.

1. Have you set call objectives and prepared clear examples of value?
2. Are you using value to differentiate your offer from the competition’s?
3. Are you using claims, features and benefits in the best possible way?
4. What added value can you bring to follow-ups with customers?

Defining value

The best value-added salespeople define value in the customer’s terms. They understand that value is a moving target: It’s anything a particular customer wants it to be.

The goal: Uncover the prospect’s needs, analyze the costs associated with those needs and translate features of the product into what it’ll do for the prospect.

Adapted from “The New Science of Selling and Persuasion,” by William T. Brooks

Tags: customer, presentation, price, quality, salespeople, test, Value, value added