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Overcoming the Dreaded Price Objection

Guest articles > Overcoming the Dreaded Price Objection

by: Kelley Robertson

Objections are a natural part of the sales process. Yet, after 15 years of working with sales people I have found that many have a difficult time dealing with price objections. Here are a few strategies that will help you overcome price objections more effectively.

First, it is critical to know that price is not the primary reason make their buying decision. I have written several articles about this topic before but unfortunately too many sales people fall prey to the myth that price is the only reason people buy a product or service.. While this may be the case in some situations, it is seldom the focal point of person's final buying decision. Unless you are dealing with someone whose sole focus is to get the lowest price (and that does happen), the best strategy is to effectively demonstrate the value of your product or service.

Simple in theory; however, difficult to execute.

Many sales people use an approach that is ineffective. They fail to clearly demonstrate the value of their product because they use the same approach when presenting their solution. They used a "canned" pitch which seldom addresses the prospect's key issues. Even though their solution may be the best, they fail to present it properly.

The key is to ask enough of the right questions to determine exactly what is important to their prospect. Although this is a fundamental step in the sales process, too many sales people short cut their way through the qualifying stage so they can talk about their product. But this means they end up presenting elements or features of their product that are not relevant to their prospect and every time you talk about something that is not important to your prospect, their desire to buy drops.

The trick is to uncover their hot buttons or the impact of their existing problem and focus on showing them how your solution will overcome those problems. Here are a couple of key questions you can ask that will help you achieve this.

"Mr. Prospect, you mentioned that your current vendor was late with their last two deliveries. What did that cost you?"

"What problems did you encounter as a result?"

"How did that affect your business? You personally?"

"What will happen if you don't make a change?"

These are tough questions and they require a certain amount of courage to ask. However, I have learned that most executives will share this information if you summon up the courage to ask them. You may think that these questions are too probing or too personal but it's important to know that executives are used to asking tough questions and they respect sales professionals who can do the same.

Let's say you have asked these types of questions and effectively presented your solution. Your prospect may still say, "Your price is too high." In these situations, the first question you need to ask is, "Compared to what?" This will help you understand why they made that statement. This will help you prepare an appropriate response.

This sounds great Kelley, but what about situations when the prospect has a certain budget and the price of my solution exceeds that amount?

I will be the first to admit that budgets are always an issue. We all have to work with budgets and corporate buyers are no different. Here are a few strategies that can help.

1. Deal with the highest level of decision maker possible. High level decision makers will always find a way to pay for a solution IF it makes good fiscal sense. Once again, I bring you back to the importance of demonstrating the value of your solution. If you can effectively demonstrate how your prospect will achieve a good return on investment (ROI) they will find a pay for it.
2. Sometimes budgets can be reworked. I once contacted a company to help me develop a training video. When I mentioned that I had a specific budget to work with the sales person immediately asked me when my fiscal year ended. I was working with my current year's budget and that our new year began in three months. He suggested that we arrange the billing so that half of the project was billed in the current year and the remainder was billed at the beginning of the next year. This helped me arrange the financing and he secured the project.
3. If budget is a key issue, consider offering a partial solution (if possible). In some cases, a partial solution may be enough to get the project started while meeting your prospect's limitations. It doesn't always make sense but it can be an alternative.
4. Be prepared to negotiate. Are there aspects of your solution that can be eliminated or changed so that you can secure the sale AND your prospect gets what he or she wants? Be creative. Consider barter. Think outside the proverbial box and look for ways to make the deal happen without resorting to a straight discount.

Price is a factor in every sale; however, it is seldom the primary reason someone makes a buying decision unless of course you fail to demonstrate the value of your product or service.

© MMX Kelley Robertson, All rights reserved.

Kelley Robertson, author of The Secrets of Power Selling helps sales professionals and businesses discover new techniques to improve their sales and profits. Receive a FREE copy of 100 Ways to Increase Your Sales by subscribing to his free newsletter available at www.kelleyrobertson.com. Kelley conducts workshops and speaks regularly at sales meetings and conferences. For information on his programs contact him at 905-633-7750 or Kelley@RobertsonTrainingGroup.com

Contributor: Kelley Robertson

Published here on: 05-Dec-10

Classification: Sales

Website: www.kelleyrobertson.com