Each salesperson, regardless of how experienced they are, has a weakness or at least something to be improved when talking about price. Price, in fact, is strictly related not only to how much we value the product or the service, but it also represents how much we value our work and, ultimately, ourselves. Evaluating and displaying price correctly stems from our psyche, our core values, our beliefs, and our self-esteem. Join us, therefore, in this series of tips to help you evolve.
Strategy and tactics when talking about price
Regardless of how skilled you are at raising the value of your company and of how foolproof your price strategy is, if your salespeople can’t display quotes effectively, it all falls apart. No strategy is infallible if we don’t know how to present price through negotiation skills, equally supported by interpersonal skills.
A handbook of mistakes to avoid when talking about price
1. Mentioning price too early or too late
When should we talk about price? If the topic is approached too soon, we might lead the customer towards focusing on the economic aspects before they have enough information to evaluate them properly. Even mentioning it at the end (perhaps waiting until one is asked “How much is it?”) is a mistake because what is said at the end of a negotiation is what is remembered the most. We should then talk about it halfway through the presentation, when we have already displayed part of the value of our offer. After uncovering the price, we can carry on presenting the advantages of the purchase. What if the client asks early on? We can reply by initially explaining other elements of value that support the quote.
Mention price halfway through the presentation, explaining the value of your offer before and after you mention it. Do the same for quotes.
2. Asking “How much do you want to spend?”
Along the same lines as the previous tip, it’s best to avoid asking the client what their budget is. Many salespeople ask this question at the beginning of a negotiation to find their bearings more quickly, believing it saves them time, but that’s not the case. At the beginning, clients tend to be suspicious, and this question can make them feel even more tense. Most of the time, when clients are asked how much they want to spend, they tend to choose an amount that is lower than what they are actually considering as a defence mechanism. In practice, it’s as if their lack of trust in you applies an immediate discount to the offer.
Feel free to spend all the time you need to reassure the client before you mention price, while trying to indirectly figure out which range of products or services they might be interested in.
3. Being vague
The most unprofessional and unpleasant thing that a salesperson can do is to say “around 100 Euros…” when asked about the price and then backtrack by revealing that the exact amount is higher. What you consider to be just a little more cash is, for the client, a sign of carelessness and proof that you don’t value their investment in your product or service. A salesperson must know the prices of their offers like the back of their hand. If calculating the quote is convoluted, don’t wildly name an approximate figure instead of taking your time to calculate the exact amount.
Take your time to understand what the client needs and to make accurate quotes.
4. Presenting a wide price range
We have all dealt with salespeople who, when asked “How much do you charge?”, replied “100 to 200 Euros”. You should know that the client will only remember the lowest figure, and any higher amount will later seem like an extra expense. Therefore, Rule 3 still applies: provide an accurate price! If you have any doubts or you need to answer “on the fly”, it’s better to provide the highest charge to then pleasantly surprise the client with cheaper offers.
Avoid confusing the client by providing wide price ranges. Present exact figures.
Photo by Anita Jankovic on UnSplash
5. Rushing and raising or lowering your voice
You might have noticed that many salespeople’s tone of voice changes when they talk about price. There are ones who start sighing when whispering the amount, ones who rush and become incoherent, and others who even raise their voice and sound aggressive. These variations reveal a change of emotional state that might make the client think that there is something wrong with the price. If you belong to this category of salespeople, the only thing you can do is to practice uttering the price with a calm and confident tone of voice, rehearsing like actors do before going on stage.
Listen to yourself while you talk about price and make your voice sound confident and clear.
6. Creating too many rituals to talk about price
“Take a seat so we can talk about pricing”, or “let’s move to the other room to discuss the quote” are sentences that needlessly increase the tension of the negotiation, turning it into something more serious than it actually is. Price isn’t a touchy subject but a feature of the offer that, like any other feature, must be presented simply and smoothly. If you think that the pitch requires a cosy setting, find a place dedicated to all the negotiation, not just for the part regarding price.
Don’t consider price a state secret but approach the topic honestly and transparently.
7. Adding comments such as “It’s cheap” or “It’s expensive”
There are salespeople who feel the need to give unnecessary advice, adding comments and opinions about the features and… about their personal view of the price. The customer needs to be helped to independently and freely evaluate our offer, without being influenced by outside judgement. A price that you consider low or very high might have a very different connotation for the client depending on their purchasing power.
Don’t comment on price. If the customer asks your opinion, do so according to their needs.
8. Not describing the value that the price corresponds to
Price and value are two strictly related concepts in the mind of the client, and our presentation should strengthen this correlation. Therefore, always present price and value together, explaining not only what you are offering in terms of features, but also which advantages stem from them. Clients see value in everything that is useful, that solves their problems, or that benefits and improves their life.
Present price in combination to features and their related advantages.
9. Tensing up when facing comments, questions, or counter-arguments
The fact that the client reacts after the price is revealed is normal. Talking about price, in fact, means liaising with the client, who might comment, ask questions, or even object at times. The latter can be a way in which clients are truly testing us to see how confident we are about the quote. If we tense up and show annoyance, we won’t get over it. Embrace the exchange and take advantage of that moment to further explain the value of the offer.
Embrace your client’s reactions by patiently and professionally working through their opinions on price and helping them overcome doubt.
10. Giving them a discount without knowing why they want it
The client might ask for a discount. Make sure you don’t grant it too hastily, without understanding where the request comes from. You might give the impression that the initial quote was too high or artificially inflated. If you find yourself in need of giving a discount, protect the value of your offer by asking the reason for the discount. A good negotiation, in fact, is based on fair exchange: unilaterally granting something isn’t good for either party and compromises the positioning of the value of our offer.
Give discounts while asking the client to do something for you, such as purchasing a larger quantity, paying earlier, closing the deal within a particular deadline, or offering more business opportunities.
Price and financial stability
We usually think of our stability in economic terms. Most people set up their professional life in order to have guaranteed income and to accumulate or save assets and liquidity, but it is our value and our values that ensure we are well-grounded in terms of our identity and in terms of what we can offer to the world. As Bill Gates says, “You don’t get rich because you know how to accumulate money, but because you know how to generate value”.
If in talking about price it’s vital to link the figure to its corresponding value, we can do the same when we think about financial stability: link it to your own value, and you will see that it will last longer and yield more results.
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