Being in the world of sales the question of pricing has always been encountered by sales professionals on every level. Various questions cross your mind when you face such circumstances.
- What is the most intriguing fact behind the question that your prospects asked?
- Why do they mention the expensive part of your product and service without considering the fact that it is going to solve their problems they have been facing until now?
- Is the question asked because your prospects are bound by low-budget?
- Or do they lack in apt knowledge of the market?
- Or the standard features are missing from our product and service which the customers notice and compare your price with that of the competitors?
If you have read till this part, then we are sure you have been troubled with the pricing question and have been looking for a method of responding to pricing questions.
However, if you want an answer to the question, then you must understand why price hits the psyche of your prospects and why it hinders a crucial deal from timely closure?
The Biggest question,”What’s the price?”
You called up your prospect after they have shown interest in your services. While explaining the services to them, you are cut short by the prospect, and he asks you, “what’s the price?”
- You are baffled because you do not know how you should respond to him? If you quote too high, they get the chance to get you off the phone.
- But if you quote something low from the standard company price, your manager is going to be really angry with you.
- This catch-22 situation sometimes does lead to miscommunication related to price and various other related deals.
As we said earlier, this is a tricky situation, and you are clueless about your apt reply at this stage. So, let’s understand why such questions are asked to sales professionals and how you can respond!
Q.1 “Will Your price fit my Budget?”
Your prospects range from millennials to CEO’s, and the budget is the “constant” that triggers the buying decision in everyone. Budget is a critical factor in such scenarios.
You have to find out if the prospect lacks the budget for initial investment or the price is too high for the longer term? For businesses, initial investment may seem too high, and an easy payment plan makes them nod for the price quickly.
Another issue that is related to budget is the value of the product that the prospect doesn’t see against the price.
- In such cases, be upfront and ask the prospect when will your services become feasible for their budget and reach out to them at that time.
- With proper consultation with the higher authorities, an exclusive deal can be designed to meet their budget if they are going to provide future business and recommendations.
- You can also make certain cuts in the features they do not require and pay only for the ones they want to use. In this case, you make it feasible for them to use your services.
- As a sales representative, you have to be persuasive but not forceful in explaining to them how your solution is an investment in their company’s future.
- Make them realize that it is not like spending their budget on office furniture and in turn holds actual ROI.
- Provide them with a dollar amount that makes your deal a lot more tangible, this way the prospect can see the value that is related to your services.
The next stage of pricing question is the comparison between the prices of your competition.
Q.2 “Why is your competitors’ Price lower/ higher?”
But, compared to what?
Expensive is a term that is relatable to every sales professional. Prospects must realize how valuable your product is. Knowing and understanding this helps you plan the terms of negotiation with the prospect while successfully closing deals.
- If your prospect is placing his buying decision on price comparison with your competitors, then do your comparison homework too.
- You can do so by comparing the features that your solution provides against the price and reassure your prospects about the added value that comes with a higher price tag.
- Sometimes their buying decision gets swayed not because of the features, but with the warranty or post-sales support, they will receive if they chose your brand.
- If your services have any kind of competitive advantage over your competitors, make sure that your prospect is aware of them.
Q.3 “Your Service Misses some features!”
Sometimes, while making comparisons, the prospect notices that your services lack some features that your competitor offers?
Find deal breakers or a negotiation tactic for the buyer.
- Highlight and focus on the features that your brand is offering, and others aren’t.
- Reason with your prospect that even though we lack in the X feature, it doesn’t make a lot of difference because the Y feature makes it up for the absence. Make them believe that your Y feature adds more value to their purchase than the lack of X feature.
- If you have been inquired about the absence of more than one prospect and the number keeps increasing, then you must let the higher authorities know about the same.
- Let them decide what deal they can strike with third-party service providers for merging the said feature into your services and how to get it on their product roadmap for the future.
Q.4 “Does your services provide timely ROI?”
Time is the factor that surfaces in various forms and occasions. The prospect may lack time for allowing the transitioning of the service into their organization. They may be looking for immediate ROI. They might not have an ample amount of time on their hands for training employees on a new solution.
Time Equals Money. – Entrepreneur
For the sellers who want to solve the problems of their prospects with their solutions, we hope these responses will help you out.
- You must assure your prospect that your solution has minimal downtime and it won’t hamper their productive working hours in any manner.
- They can carry on with their daily business process and finalize transitions after their working hours.
- Explain how your services will provide ROI after three or six months or a year, etc.
- Lay down the monetary value of the return in front of them so that they can make a quick buying decision.
- If training is required for operating your solution, then explain the exact timeline.
The answer for price-related questions is not easy, especially when you want to add value to your response so that the prospect does not feel that he is just listening to a dull and monotonous sales script.
- As a sales professional, you must be direct and confident while addressing such queries from the prospects.
- “Our price is $X, inclusive of XYZ features and add-ons. Other than price, what will steer your final decision?”
- “Price” comes first in many situations; the prospect will for the price and the value of your product provides against the set price. As sales professionals, you respond the best way possible to justify you solutions pricing.
- Rather than debating the concept of price, you steer the conversation back to the value of your product.
- The lack of hesitation, refraction, or apologetic language makes you look less confidence while discussing your prices.
- Finally, do not play around with your official value unless you or your superiors feel that the deal is beneficial for your organization’s future.
While responding to the price question remember one small fact; if your prospect has asked for the price, then they want to make the purchase. However, the final decider will be the price you decide for them for making that purchase.
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