Steve here coming to you from Key West, Florida. If you’ve spent any time reading sales literature or have ever attended a sales training course you know that there is a never ending discussion on selling on price. If you’re good at sales, then you needn’t worry about price. All you have to do is focus on selling the benefits and frame your offering in just the right way and you can overcome price objections.
Sales Trainer Tom Hopkin’s advocates reducing the price to “the ridiculous.” Instead of saying that your product costs $1000 more you want to break the price down to a daily level. Something like, “…and you can enjoy this bad boy for only nickels a day more than that other, not quite-so-good brand.” (This by the way is the heart of the ROI sell.)
All this is good stuff, but I’m here to tell you that price is still a very effective strategy, especially in economic times like today and especially if your product has no real definable difference. (Yes, you can still find something to differentiate yourself but sometimes the effort is not worth the reward.)
She lowered the price so I bought it.
For example, here in Key West the main street, Duval Street, is lined with shops selling T-shirts and other assorted tourist stuff. Walk from one to the other and there is absolutely no difference between the merchandise in one store versus the merchandise in another. How do they differentiate themselves from one another? You guessed it…price. And they are willing to deal when you’re in the store because once you leave you probably ain’t coming back.
So while we all need to place some effort into adding value and creating a great customer experience we need to never forget that having the lowest price is always an effective selling tactic.
Till next time…
{ 23 comments… read them below or add one }
Nice pic from beautiful Key West. I’m picking up little tips as I continue reading your posts like “the heart of the ROI sell”.
Cheers Steve!
Keri Eagan
Alternative*Insight
Excellent way to sell price to price shoppers.
Jose Escalante
http://www.joseescalante.com
“She lowered the price so I bought it.”
And it looks like she even threw in a Free T-shirt to seal the deal
Rob
Just what are you buying there Steve?
Martin O’Connor
http://smallbusinessdesigncenter.com
I’m buying the t-shirt, which I was convinced to buy when she drastically lowered the price. Not normally the type of shirt I would wear but I appreciate a determined sales effort.
I told her part of the deal was I wanted a picture.
Steve
Do you teach negotiating? Good work!
I had a hard sell hammered on me this week-end. I’m down in Mexico and was a Day of the Dead festivities. The Mexicans know how to celebrate.
I was at an outdoor market, which is big part of many celebrations,
and the cute young thing, late teens, with a bright smile came up to me an wanted to sell me some non-alcoholic wine.
First she stepped in front of me to stop me. She had a small plastic cup with a sample, which I declined knowing what was to follow. She insisted I try. Since I, like Zorba, think it’s a sin to refuse a pretty woman I tried the sample and acknowledged how good it was.
Since I speak little enough Spanish and she no English whatsoever all this was by hand gestures and body language, mostly my trying to move on and she blocking me.
I could tell by the look in her eyes she found me very attractive
thus explaining her reluctance for me to leave her.
I soon succumbed to her charm and bought two bottles of wine.
I had to laugh out loud as I left and softened up having experienced one of the hardest sells in my life.
Martin O’Connor
http://smallbusinessdesigncenter.com
To the well-education and well-inromed consumers, price is most often the deciding factor.
After considering for 10-20 different factors, it all boils down to perceived value, as reflected by the price they are willing to pay for.
John Ho
Numerology Expert Helps Understanding Personality for Better Influence & Persuasion
If we can build perceived value, price is not an obstacle.
If people think they don’t have the extra money, time to lower price.
Steve,
Was the guy telling dirty jokes for $1.00 any good?
Lynn Lane->Success Strategies For Life
Low price often gets a lot of bad press in the sales world, but is still one of the most effective sales levers, provided you are low cost!
http://www.martin-wright.com
Strategies For Success
Who are the girls?
Martin O’Connor
http://smallbusinessdesigncenter.com
Very valid points you made.
Bert (alter ego- Mister P)
MisterP.org/blog
Great article Steve!
I’ve recently been doing some work on price and sometimes all it needs is a gesture on price to persuade a customer to buy.
Even on your t-shirt street the chances are you won’t have perfect information as a consumer; in all likelihood you’d get bored checking every single stall selling t-shirts, or even asking at each one if they would beat the price of the last place you went to.
So what makes the difference?
As with so many things that hit our emotional brains it’s how we feel about the price. As you say, when it’s framed right, it feels good.
Offering to reduce your price somewhat doesn’t mean you have to match the bottom of the market; as someone in an industry the chances are you have more information than your customers.
As always, seeing the world through your customers’ eyes is key.
Philip
Consumer Behaviour Expert
[The Consumer Behaviour Research Resource]
Hi Steve,
Indeed, an excellent sales reminder especially when you are in the One-Time in all likelihood with the customers like with most tourist and resort towns. I remember buying 2 pairs of shoes in NYC one time because I was in there trying them on and was ready to walk when the sales girl made me a great price offer, which triggered my salivation and anticipated regret if I DIDn’t buy them. And then I did. One of the two I loved. I can’t even remember the other pair.
Happy Dating and Relationships,
April Braswell
Single Boomer Dating Expert
And that’s exactly what price should be about, lower it when you have a buyer ready to buy . . . not just for the sake of stimulating demand.
Lowering price in an instant for one customer raises perceived values and creates that salivation April mentions. It’s a seal the deal moment.
Katie
So… so true….
I tease that you are not buying a price… you are buying a product!
Scott Payne
http://www.scottpayne.me
I agree with April and Katie’s point….a last minute reduction in price will tip me in just the right direction.
MissMentor
This is a great point that small business owners especially are often keen to gloss over…
You have to be able to compete on price.
Sometimes it really does just come down to price. I know that “nickels per day” strategy has worked on me many times. I find myself justifying things in that way. For example, in September my kids both wanted backpacks that cost twice what I usually spend. I found myself doing the math and reasoning with myself saying “well they go to school 180 days a year so if I divide the price by 180 days……” yeah!
Lisa McLellan
Babysitting Services – Babysitter in your area
Price is compelling but not always convincing.
Kate
Just for the sake of making a comment let me recommend my son’s site,
powerdiversity.com
You might enjoy it. Try the “Thought for the Day” or “Just For Fun.”
Martin O’Connor
http://smallbusinessdesigncenter.com
A reference on selling and price: Hypnotic Writing: How to Seduce and Persuade Customers with Only Your Words by Joe Vitale.
Apparently I have not sold Kati on the dangers of the Fed.
Hi. I wanted to say thanks for keeping up the great work and also wish you a Happy Thanksgiving! Keep in touch…
Greg Dougall, Philanthropist-in-Training
Steve:
Best wishes for a Merry Christmas!
Marty