Before presenting your product, the customer will not ask about the price. It is mostly advised that you start the presentation with "For a very few cost ... you will benefit from" .
So Focusing on the benefit first, after you say "For a little cost ... " then the client out of curiosity will ask you about the price. But this will come after you have explained the benefits of your product.
So Price is a timely BOMB .. right ?
Good then difuse that bomb my shattering the customer's concentration on price ...
As I explained above; he is expecting to know the price first ... then give him what he is waiting for ... but not the price ... Use (Example) " for as low as you can never expect, this product which gives you this and that..., and which is composed of this and that..., will sell at your shop very fast, turning your little investment into a milky-cow"
You will find that you have explained all what you wanted cutting the way to the client to discuss price before you finish.
I will leave the rest for you to close the deal ...
Nabeel S. Al Wazzan
Marketing & Sales Consultants
From Kuwait , Kuwait
A premature price discussion is usually result of a faulty sales approach. Most customers are reasonabe people who are looking to get the very best deal for their companies, and the best deal does not always come with the lowest price. However, customers bring up the issue of price when:
(1) The value of your offer is not clearly understood by them. Value will be clear to them only when they are convinced that your solution could resolve their problems or meet their objectives. Most sales people fail to identify these, hence value will never be understood by the customers.
(2) Sales people follow a product centric approach. Majority of sales people conduct selling upside down: they start prescribing their products or solutions before dignosing the customers for their problems. When you devise your solution based on customer's expressed problems and objectives; and their own criteria, price is usually not a big concern.
(3) There are hidden objections other than price, which are not unearthed by the sales person. Many customers, when they raise a price issue are looking for some excuse to differ the selling process. There are concerns related to the status quo which could be preventing the customer from taking the sale forward. When sales people fail to understand this, they blame the customers for their price sensitivity.
(4) Sales people fail to alleviate the customer's risks. There are risks involved in all major sales and customers are reluctant to proceed with the sale, unless the risks are identified and eliminated. Their fear of change and lack of comfortability with the new solution etc need to be considered and dealt with.
You could check my blog www.missionselling.blogsource.com where I have addressed these issues in lot of detail over many articles. Recently I have added an article, "Look how companies are teaching sales people to sell on price", where I discuss how companies are default programming their sales people to fail by selling on price.
If customers are raising price issues prematurely, you could adopt one or more of the following responses:
"I will be glad to give you an idea of our prices, but to quote you an exact price, I still need to get some more information from you"
"For similar kind of applications, we are able to offer our products/services in the range starting from X .....to Y, but I cant be exact unless we are able to figure out the exact nature of your requirements"
"We are definitely not the cheapest in the market. But then, you are not looking for the cheapest option, are you?"
"Will this be decided on price alone?"
"For an application similar to yours, X customer has paid Y amount which included services such as .......We would be able to determine a specific offer once we sit together and discuss your specific needs and challenges".
Telling a range or an approximate price level gives you an added advatange of pre-qualifying the customer and setting expectations early.
After you have diverted the customer's attention from price, go back to diagnosing the customer for his problems, issues and challenges using skillfull questioning and active listening. Once you know his issues, needs and the criteria by which he will make his decision, you can make a customised offer to the customer.
Trust this helps.
From India , Delhi
To share my reading of the book named: The Power of Relationship Marketing" - Author Tony Cram.
It is true for personal and commercial relationships that the greatest potential for quarrels and disagreements is money. The financial dimensions of a relationship are the most fraught with risk. The pricing aspect of Relationship Marketing is crucial.
The price in a transaction is the balance point between the interests of the two parties. In its simplest terms it may represent the lowest figure the vendor is prepared to accept for parting with his item, and the highest amount the purchaser is prepared to pay. Prince is marketing terms also connotes value. Thus the position of a product in the choice dimension will be influenced by the list price.
Three rules of relationship pricing:
1. Share the benefit with your long-term customers.
2. Never use price as a promotional weapon.
3. Develop customer-based prices.
Regarding the Rule 2, Tony Cram has listed the following points:
1. Start price wars which every-one loses.
2. Damage the value image you have built up.
3. Teach customers to await the next offer.
4. Creat expensive demand surges.
5. Lead to subsequent demand collapses.
6. Disrupt your customers stock levels.
7. Given to new customers anger existing customers.
8. Imply you have stock problems.
9. Suggest you may be replacing the line.
10. Exaggerate your perceived profit margins.
11. Generate stock outs.
12. Distract your staff from customer needs.
13. Invalidate employee performance measurements.
14. Confuse sales trend analysis.
Take price out of the equation.
The ideal stance has three sections:
a. The products, its service, support and reliability offers compelling
benefits. (moderate emphasis).
b. The price is fair. ( low emphasis)
c. A final benefit, perhaps of personalisation, or representing innovation.
Well, the importance of price to both buyer and seller's profitability throws a particular stress on this aspect of Relationship Marketing. At the same time, technological developments and world competition are pressuing price levels in many markets. The risks of price problems in the relationship can be addressed with the above three rules.
From China, Shanghai
Its no surprise that price is one of the key factors for lot of people in the buying process but its not the only factor. Let's take an example to explain this, you go to a showroom to buy a television where you see LG for 21000 and Sharp for 13000 (no offences, please) which one would you buy? Mostly LG! But you are watching the same program so lets examine the reason:
The only difference is the value that LG adds to your TV watching experience in terms of quality of the picture, additional features, Brand or comfort zone and so on.
Now from the example we understand that customers are normally ready to pay extra if they are convinced with the value addition but every company is not LG or Leader in their industry
So what do you do?
1) Don't talk about the price till the customer doesn't talk about it.
2) Focus on customer's interest while you give your sales pitch
3) Take note of the questions he is asking because this means he is interested in those features or services more.
4) Finally, when the customer asks you price. The best thing is to compliment the price with value:
If you are flexible with the price then try this: The actual price is X but as a part of promotion you can buy this at Y price. This is 10% less than our normal price
If you are not flexible then try this: Tell the customer very confidently that The price of this particular product is X and quickly ask him how would he like to make the payment card or cash?
If the customer is upset with the price or trying to negotiate then try this:
1) Well Mr. Smith, we use some of the best products or latest technology in developing this product or solution to make sure that you enjoy 100% and I am quite sure that you are aware of the fact that quality always comes with a price.
2) Mr. Smith I am so sorry that I didn't tell you why exactly our product is priced at this price. Since, we have integrated new features and additional benefits like visual quality, audio quality, compatibility, size, relaibility. Add quickly Do you know that none of our customers have reported any complaints in the last 2 years now that's what you get alongwith our product - Peace of Mind
These are some of the time tested rebuttals used at IT and banking companies. However what you need to remember is to believe in your product 100% and speak confidently. Dont forget to mention those feautres again where customer has shown interest in your price negotiation.
keep up the commercials at the last aspect of the discussion, or the best would be to discuss the commercials through mail communication.
I am practicing the same and its working fine till date!!
From India , Madras
i am agree with harish's view, you can also add and impliment followings:
1. Product knowledge of compititors.
2. Compare marits and demarits with your product.
3. Never disclose the price first, untill sales seems to close.
4. Also involve some techniqual/ manfacturing points in your presentation.
5. Listen carefully needs of the customer and then generate the need of your product.
6. Don't go for huge discussion with the customer.
7. Give the gud examples of branded product for price negotiations. (HUL - pureit)
8. Eliminates the doubts clearlly with examples.
9. If it is not possible to close sale at the time, keep his contact no. for further prospect.
10. Focus on Refences it could be generate more leads for you.
11. Also make a chart in number like lead conversion, price issues, product quality, area segment, type of customer, target customer and analyse the chart every last day of the week.
Lets see, might be help you,
From India , New Delhi