Don't Give In to Simple Price Statements

While waiting out a four-hour flight delay, I nestled into one of the few empty seats available at an airport snack bar, which happened to be right by the cash register, within earshot of most of the transactions.

I couldn’t help but take notice of one. A customer plopped a large bottle of water on the counter.

“That will be $4.89, The clerk said.

“Four eighty-nine!! Holy-moly, that’s more than liquor! That’s crazy.”

The clerk empathized, “Yeah it is pretty outrageous. You can get a smaller one for $2.50.”

The guy said, “Well that’s more like it.” And a sale was just cut by almost 50%

My delay was so long a new work crew came in. I witnessed a similar transaction with the new counter guy—with one twist. Another customer walked up with the same size bottle of water:

“That will be $4.89.”

“Four eighty-nine! That’s robbery!”

This clerk stared at him, emotionless. He leaned forward slightly, paused, then calmly said, “Well, it’s the cheapest you’re going to find in the airport.”

The customer handed over a crisp five dollar bill. End of story. Full price sale.

The first counterperson committed the same mistake that many businesses and sales reps also are guilty of: caving in to a simple price statement.

The first thirsty customer was still going to buy the water—until the counter guy talked him out of it. Notice the customer DID NOT say, “I won’t ever buy water here because your prices are too high.”

He simply grumbled about the price.

Just like you or I might air out a few choice words about a traffic jam. We still must drive in it; we just aren’t happy about it at that very moment. Then we get over it.

The point here is that there is a difference between,

-a price comment,

-price resistance, and

-a real price objection.

Here’s the way I look at each of these, and how they should be handled. I’ll devote the most time to the first one.

Price Statements

This occurs when someone is already mostly sold. They’re just airing out a feeling.

They don’t necessarily expect a response, although they’ll gladly take one if it’s offered, and that’s a real bonus for them. And that’s normally fatal for sales reps, because it opens you up to negotiations when they’re not necessary. Just like the guy at the airport counter.

To illustrate how absurd it is to react to a simple price comment, let’s turn this around: If, after giving your price, a prospect said, “Wow, that’s a great price. I expected it to be more,” you probably wouldn’t say, “Think so? Well, let me see what I can do. I think I’ll raise it by 29% then, OK?”

So what SHOULD you do when faced with a price comment?

1. Nothing. Pause. See if they continue. (Actually this is a good tactic ANYTIME you hear a price statement, even if you think it’s resistance or a real objection.)

2. Then, have a statement of your own ready to go. Let’s face it, if you’ve been on the phone for more than three days, you’ve already heard most of the price statements you’ll ever hear. And you should prepare your response. Now, I’m not talking about “Objection Rebuttals.” Those are inane, insane, and don’t work, because they don’t deal with the real REASON behind the objection. I’m simply talking about something innocuous in reply to the price comment.

For example,

Price Statement: “Wow, your delivery charges are higher than ABC Company.”

Sales Pro: “Yes, we have an extensive tracking and quality control process.”

Price Statement: “Five-hundred dollars for the yearly maintenance contract?!.”

Sales Pro: “Yes, that covers any service or support calls you’ll have all year long.”

Price Statement: “Man, you guys must be making a killing on those. It can’t cost that much to make those.”

Sales Pro: “Everyone has been hit hard by materials increases this year.”

3. Then, it’s important to move on with the conversation. Don’t dwell on the price comment. Let it die right there. Again, let me reiterate,

Giving in to price statements takes money out of your pocket and your compay's profits!

Let's now briefly address the other two.

Price Resistance

This occurs early in a call or sales process. They’re not really sold, or even interested yet. And it could be a blow off. They don’t see any value yet.

Real Price Objections

These occur later in the sales process, and could be stated for a variety of reasons...budget, maybe there is a gap between the value perceived and the price... perhaps another company is priced less. But, they’re willing to discuss it with you. This is more of an obstacle that can be addressed than a flat-out blow off.

We could (and have) spent entire issues of this newsletter and chapters in books on how to deal with these two. However, the first step in the process is the same for both: Get them talking. Here’s an important point to keep in mind:

You will never change someone’s mind by talking AT them. You must first get them to soften and doubt their existing belief.

Canned ANSWERS to objections don’t work. They only serve to shake up the beehive by telling someone they’re wrong.

Instead, be prepared with questions to get them talking, which smokes out the real REASON behind what they say. And that’s how you deal with real objections.

Again, be prepared to deal with whatever form of price comment you hear. There’s no need to give away money.