Paul dives deep into handling price objections by showing the value you bring.
Show Notes
One of the biggest lies in business: “It’s just business.” Nothing could be further from the truth.
When you go above and beyond for the customer, when you answer that weekend call, you make it personal.
Remember, when customers challenge the price, they’re challenging the value.
How many of your customers need a reminder of the value you bring?
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How do I prove my value?
(Transcribed from podcast)
Well, I am especially pumped for today’s episode. You know, like Borat, “I’m very excite” about this episode. The reason why is that we’re going to talk about price objections, but we’re going to talk about how to prove your value.
So often I’ll hear salespeople say, “Hey, my customer tells me I have to match our competitor price,” or “I need to lower the price or else they’re going to switch.” And so, we’re going to dive deep into that. And I’m going to give you a couple of ways to respond so that you can focus more on the value that you bring versus the price differential that they could potentially save. So we’re going to talk about that.
Before we do though, hey, if you’re facing price objections, you are not alone. Every seller faces them. And, in fact, if you’re not facing any price resistance, you’re probably not charging enough. So, if you’re looking to proactively take control of that sales conversation and guide it down a path of value, you’ve got to pick up your copy of Value-Added Selling. Value-Added Selling is the go-to guide. It’s a content-rich message of hope to help you go out there and compete more profitably. So, pick up your copy of Value-Added Selling at Amazon or wherever you get your books. Heck, you can even call into our office here and I’ll sign a copy and send it to you. So, pick up your copy. It’s your go-to guide for competing on value.
So let’s get back to it. We all have faced this challenge when customers tell us, “Hey, I can get it cheaper somewhere else,” or “Your competitor offered me a better deal.” Now, I want to emphasize something before we get started. You know, one of the biggest lies in business is that people say, “Hey, it’s nothing personal. It’s just business.” You know, nothing could be further from the truth. And, the reason why is, as salespeople, we put our heart and soul into our business, into our territories, into serving our customers. We’ve got to remember that when you go above and beyond, when you take time out of your weekend to support a customer, when you answer that call at midnight, when you are on call 24/7, you’re making it personal. Let’s be very clear about that. This is your profession. You spend your entire life building a territory. Nothing could be more personal than that.
In fact, I had the privilege earlier this week at a kickoff meeting, I heard a VP of sales. He gave kind of his final speech after 30+ years in the industry. And it was very touching. It was very personal. And so, it’s never just business. It is 100% personal. And as we begin this episode, I want every salesperson out there to realize, when a customer tells you, “I can get this 5% cheaper somewhere else,” or “I can get this 10% cheaper somewhere else,” they are basically telling you you’re not worth 5% to them, that you’re not worth 10%. Let that sink in for a moment. I’m going to share some ways that we can respond to those price objections.
So, this technique—we’re going to give you one technique. That’s all you need for today’s session. We’re going to focus on cashing in your chips. That’s what we call this. This is taken from Crush Price Objections, but the technique is called cashing in your chips. In this technique, what you are doing is you are combating that price objection by emphasizing the personal value that you bring. I hear this from salespeople all the time who share great examples of how they communicate the personal value.
One that always sticks with me is an equipment salesperson. He’s out in California. He was in one of our training seminars, and here’s what happened. One of his longtime customers called him up and said, “Hey, I need this piece of equipment.” And he checked the rental yard and there was nothing available. He even called some of his competitors and none of them had the equipment available. He called his branch in southern California, and keep in mind, he’s in northern California, and he called down there and said “Hey, I know you have this piece of equipment in your yard. My customer needs it. Can we get it up here next week?” And the manager said, “Yeah, sure.” So, he called the customer back and said “Hey we can get it to you next week,” and the customer said, “You know what, we’ve got to have it tomorrow.” We’ve got to have it by tomorrow and tomorrow was Saturday.
And so here’s what the salesperson did. He called the manager, ended up meeting the manager halfway up and down the coast, got the equipment to the customer by Saturday morning. Bailed out the customer. The customer was thrilled. And then they sent in the invoice.
Now, the controller at this company saw the invoice, called the salesperson and said, “Hey, your rent is a little high for this piece of equipment. I did some price checking, and we could get it for this.” And it was a rate that was, maybe 20 to 30% less. And the salesperson explained that they had to transport the equipment and all that. And the controller had the tenacity to say, “Well, if you don’t lower the rate, we’re not going to pay.” That’s basically what the controller said. And so, the salesperson said, “Okay, I’ll change the invoice.” But he didn’t change the price. Instead, what he did is he added a line item to that invoice that said, I missed my kid’s soccer game on Saturday delivering this equipment—no charge. He walked in and hand delivered that invoice to the controller and had the controller review it. The controller looked embarrassed and said, “Okay, we’ll get you paid.” You know, when customers challenge your price, they’re challenging the value. And remember, it is personal.
There was another example and, gosh, this one’s even better. In one of our two-day Value-Added Selling public seminars, (we host those four to six times per year here at my office in St. Louis), we had an automation salesperson in one of our training sessions, and she shared this story. It was incredible. We were talking about personal value and how you bring value and overcoming price objections, and she shared this example.
One of her largest customers called her on a Saturday. The plant went down. So it was at some sort of processing plan or whatever. She got a call from the plant manager. Plant manager said, “Hey, we need you out here right now. The plant went down. We don’t know what’s going on. It could be the automation. It could be the equipment. It could be a number of factors. This is an all-hands-on-deck situation. We need you out here in case we need some technical support.” And she politely asked, she said, “You know what, I’m at a baby shower right now. Is there any way it can wait a few more hours?” And the customer said, “No, we need you out here now.”
So, she left the baby shower on a Saturday, went out to the facility, was on standby just in case they needed her support. She ended up helping him out and they got up and running once again. Now the customer was thrilled.
Now, a couple of weeks later, she put together a proposal for a new piece of business and the procurement manager said to her, “We really want to give you this business, but your price is just a little too high. Is there any way you can come down a little bit?” And she said, “You know what? Let’s do this. Let’s bring in the plant manager. Let’s talk about this. Let’s figure out a way to move forward.” And that’s what they did. And when the plant manager was in there with the procurement manager, she said, “You know what? Just a couple of weeks ago when you guys called me, and I left a baby shower just so I could get here and support you, what is that worth to you?” And the plant manager acknowledged, “Hey, you know, that’s worth something. You helped us out.” And she goes, “What you may not know is that it wasn’t just any baby shower. It was my baby shower. It was the baby shower that my friends were throwing me, and I left so that I could come here and support you. And now you’re going to beat me up over 10% on price? This is the value I bring, and this is the value you’re going to continue to get, but the price is the price.”
Now, she won the business as you could imagine. And I’ve got to say, I absolutely love that example because she illustrated just how important her value is. She demonstrated that commitment to her customers and her customers just needed a reminder.
How many of your customers need a reminder? The next time one of your existing customers tells you, “Hey, the competition can do it cheaper,” what I want you to do is create a list of all the times that you bailed that customer out, that you went above and beyond, and I want you to throw it back in their face. Let them know that it’s personal. And when they tell you, “Hey, it’s 5% cheaper,” what they’re telling you is that you’re not worth 5%. And I would ask the customer, when you present that value back to them, and they give you that price objection, frame it just like that: “Are you trying to tell me that I’m not worth 5%?” Put it out there. Let them see it. Let them feel it, and you’re going to be able to hold the line.
Make it a big day.
