It’s interesting that in most commercial environments price dominates the discussion yet only 8% of people use price as the only factor in the buying decision.
Often, we have more hang ups around price than our customers do.
We communicate price to our customers and educate them to give price primary consideration which means that the moment a competitor comes along with a lower price we risk losing a customer.
A focus on price more often creates problems for us rather than solving them.
Much of the conventional thinking on this matter can be explained in the sister article to this one Profitable Thinking v Popular Thinking.
Your customer's perception of you is much more important than your price.
If their perception of you is that of a quality supplier, unique product, convenient location etc, you'll win business.
Perception is where our focus needs to be.
And you can change that perception even though you might be selling the ‘same’ product as your competition.
Price discounting can often mean we don't make enough margin to allow proper investment back into the business to improve and refine our product and service into the future? This is a major issue for small businesses.
By focusing on price I'm certain we set up the expectation in the customer's mind that he or she can ‘do a deal’. In other words, if you're dealing in what you perceive as a price-sensitive market, don't blame the customer -look first at whether the customer has been made to be price-sensitive by price marketing.
So how do we reduce price into the sales equation?
Start from the basis that the customer always buys value.
If you look at it in mathematical terms, the ‘equation’ in the customer's mind goes like this:
Clearly then, there are only two ways to increase the value: increase the benefits the customer perceives he or she is getting or decrease the price you ask the customer to pay.
So pose the question 'how can I add value to my potential customer?'
Benefits to the consumer
5 Reasons to deal with me
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5 Reasons to use my company
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5 Reasons to use my Product / Service
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5 Reasons why the customer should make a decision today
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Gross profit margins are so heavily eroded by price discounting that only extra-ordinary increase in the volume of business will justify the discounts.
For example, a ten per cent drop in prices across the board will only be compensated in gross profit terms by a lift of at least 25 per cent in sales and a ten per cent drop rarely achieves that sort of increase.
Indeed, a ten per cent reduction in prices can produce a ten per cent reduction in the value of gross sales.
A 20 per cent discount off the normal retail prices would require an 86 per cent lift in sales. Such volumes, were they to be achieved, would require more staff, higher overheads and more intense management attention.
Be proud of your prices. If you 're not, how the hell can you expect anyone else to be.
Once you are comfortable that your pricing strategy integrates into your overall marketing effort you can focus your attention on driving sales.
Look at the following worksheet and develop a motivation and sales strategy.
Prospecting Ask Yourself........
Do I know how many prospects I want this year?
Do I know how I'm going to do it?
Do I employ definite prospecting methods?
Do I give myself a pre-determined number of new prospects each day?
Do I constantly visualize my success - in prospecting, presenting, closing?
Do I possess a prospecting consciousness, and prospecting awareness?
Do I spend time each day getting information about the prospects I have?
Do I qualify and grade every lead call?
Do I mail out a certain number of pre-approach letters every day?
Do I call a certain number of people each day for appointments?
Do I have a definite goal each day, week and month for presentations?
Do I generally find myself on schedule as I work toward by goal?
Do I start work at a set, specified time every morning?
Do I know how many hours I spend each day face-to-face in interviews?
Do I keep regular working hours?
Sales Affirmations
Behind every sale is a person.
I have more fun and enjoy more financial success when I stop trying to get what I want and start helping other people get what they want.
My selling purpose is to help people get the good feelings they want about the product and themselves.
I quickly reduce my stress because I no longer try to get people to do what they don't want to do.
People don't buy our services, products or ideas, they buy how they imagine using them will make them feel. We become what we think about.
Before The Sale
First I see other people getting the feelings they want.
Then I see me getting what I want.
I study the features and advantages of what I sell - thoroughly and often.
I see the benefits of what I sell actually helping others get the feelings they want.
During The Sale
I sell the way I and other person like to buy. I invest time as a person.
I ask ‘have’ questions and ‘want’ questions.
The difference is the problem.
I listen and I repeat back what I have heard.
I honestly relate my service, product or idea only to what the other person wants to feel.
The other person closes the sale when he sees he gets the maximum benefits with the minimum personal risk.
After The Sale
I frequently follow up to make sure people are actually feeling good about owning what they bought from me.
If there is a problem. I help them solve it - and thus strengthen our relationship.
When they are feeling good about what they bought, I ask for active referrals.
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