Customers and prospects often lean on price as an objection for why they don’t want to do business with you. Some common things you hear from customers might be:
- We can’t afford it right now.
- Our budget just got cut.
- Your competitor is offering a discount.
- I need my director to sign off on a purchase this size.
Overcoming objections like these is a lot easier when you understand how to approach the issue of price. Here are three tips that can help.
1) Move the conversation to value.
If you don’t want to face price pressure from prospects and customers, sidestep the issue of price altogether.
To do this, strategically position the conversation around value. Focusing on value means talking about the financial improvements the customer wants and needs in his or her business. Only after you lay that foundation should you discuss what the customer would be willing to pay to achieve those improvements. At this point, you’re no longer having a flat discussion about price but a collaborative back-and-forth, and overcoming objections on price is no longer an issue.
Your marketing team can help you in this area by making an assessment tool and/or a value calculator available on your website. These tools will help make your interactions with prospects more productive.
2) Differentiate well.
Price negotiations often go hand-in-hand with differentiation problems. In other words, sometimes all customers see is the price of one product versus another product.
When you compete on price alone, the winner will always be the one with the cheapest offering. Excessive discounting is not a good approach to overcome objections on price.
Again, the right tools can help salespeople differentiate successfully. A TCO tool is designed to compare the lifetime value of your solution to that of a competitor. Meanwhile, an ROI tool shows the prospect the financial payback they’ll get from investing in your solution.
3) Don’t lead with your demo.
What are the business issues your prospect is struggling with? How can you help solve those challenges? Why should this person spend money with you specifically?
These are questions that often get overlooked by salespeople who are incentivized to give a sales demo rather than dig into business issues. The fact is, many salespeople feel intimidated by talking about anything other than the features and benefits of their product. This makes overcoming objections on price more difficult than necessary.
However, it’s a universal truth that prospects don’t want to hear product pitches. They want to know how you can help them solve a business problem. Don’t set salespeople up to fail by encouraging them in the direction of the data dump.
Note that salespeople do not have to become financial experts to have value-based conversations with prospects. They simply need the right tools to help the prospect estimate value.
