“I’m having trouble selling my business development system. Do you think the price is the problem? Is $500 too much to charge? Should I sell it for less?”
David R., MI
Ever have a potential deal fall apart because your prospect isn’t happy with your price?
You know the situation. You’ve got a qualified prospect on the phone or you’re meeting with them in person and they’ve agreed that your product or services are the perfect fit. Then you mention the price, and they don’t bite. They tell you that they want to think about it or they need to talk to X or they just flat out tell you its too expensive.
But is price really the issue?
In fact, price is rarely the problem. And if your prospect isn’t buying, lowering the price won’t guarantee the sale.
Typically when your prospect objects to price, the real problem is that they don’t understand the value of your products or services. And it’s not their fault; it’s the fault of your marketing strategies. Whether you sell consulting services, hand tools, or chicken legs, the price you can charge is based on your prospect’s perception of its value to them.
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Want to avoid losing clients due to price? Here’s an example of what not to do.
Earlier this fall, I was planning a family reunion at a charming old inn in the Berkshires. As part of the festivities, I wanted to organize a light breakfast buffet for the 50 or so relatives attending. The inn quoted me a price of $29 per person, without giving me any information about what was included. When I got the quote I was shocked. It was much more than I’d anticipated, and I decided to drop the whole idea.
What was the fatal small business marketing mistake the Inn had made?
Without a clear understanding of what I was going to get for $29 per head, I had no means of determining whether it was worth the money. I didn’t know whether the $29 per person charge included just a cup of coffee and a doughnut or a full buffet breakfast with a chef on hand to cook custom omelets.
Either way, the inn lost an opportunity to feed us all another meal and profit from the presence of our large group.
Read your prospects’ objections to price as a signal that your marketing isn’t doing its job. Your business marketing information and process isn’t giving your prospects the information they need to understand what your products or services can do for them. As a result, they don’t buy from you.
The purpose of small business marketing is to minimize the effort needed to close a sale. If you’re still working hard to get prospects to buy, find out how to remove objections so more people will buy from you. Use this link to claim your copy of Eliminating Obstacles to Sales >>
Want to avoid objections to price, sell to more people and even raise your prices?
Since the price a prospect is willing to pay for your products and services is directly related to their understanding of its value to them, then the higher the perceived value, the more you can charge.
One of my clients, Janice, was working way too hard at bringing new clients to her phone coaching business. She helps clients eliminate anxiety and replace it with self-confidence so they can be more productive in their work and lives. She had dozens of prospects, but when she quoted her fees, too many prospects opted not to sign up.
When I asked her to describe the things she does for her clients and the benefits of her services, she gave me a lot of information and many examples of her successes. Then I asked her how much of this information her prospects knew. Very little, she said. Whoops!
The solution was simple. I showed Janice how to structure her sales conversations and how to ask the right questions to get her prospects talking about their goals and needs. This sets the stage so that when she explains the services she provides, it’s clear that they are the perfect solution to her prospects’ problems.
The result? Instead of lowering her prices to get more business, Janice increased her fees. Within a week she was making 50% more money.
Poor understanding of value = High resistance to price
Perception of high value and benefit = Low resistance to price
Wouldn’t you like to have prospects be eager to pay the prices you charge? Sound impossible? It isn’t.
When your prospects fully understand of how much better off they’ll be or how much more successful they’ll be with your products and services, more people will want to work with you and they’ll happily pay more to do so.
You could be closing more sales and making more money, but it’s not going to happen if you keep using the same marketing and sales strategies. Discover what works >>