On this episode, Paul discusses the customer that wants all the value of your specialized solution but balks at the price.
“Highlight the difference between what the buyer says and what the buyer is doing.”
“Take the focus off of price and put the focus back on….”
Draw a parallel between your solution and the customer’s high standards.
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What if the buyer wants value but doesn’t want to pay for it?
(Transcribed from podcast)
Today, we’re going to talk about price objections. Price objections have been coming up more and more lately, and that tends to happen. It goes in spurts, especially when you get to the end of a quarter. I’m recording this episode on March 31st. It’s probably going to show up, I don’t know, next week sometime. But towards the end of a quarter, buyers know that they can apply a little more pricing pressure because salespeople are trying to hit their number. And when they apply pressure, salespeople discount. So that’s probably what’s leading to this influx of price objection-type questions.
So I was working with a sales group last week and the basic question was this. And this was with a live training group, by the way. I should mention live, in-person session. One of the questions came up around selling value to a customer who tells you that they want quality, they want performance, they want all these things. And once you provide them that, then they object on price. And you’ve been there. I mean, as a salesperson, you’ve had this experience. Basically, you’re talking to a customer, you identify what they need, they tell you what’s important, and you provide them that solution that’s perfectly going to fit and match their needs. But then they start complaining about price. It’s as if they didn’t know that having these unique needs leading to a specialized solution would cost a little bit more. So we’re going to show you how to overcome that objection on today’s episode.
Before we get into that though, a quick shout-out to our sponsor, Andrea, over at The Creative Impostor Studios. I’ve said numerous times here that podcasting is such a great way to connect with your audience. And your audience could be anyone. You know, it could be within your own company or group of customers, you could be building your own brand, starting your own company. Whatever it may be, podcasting is a great way to connect. And if you’re thinking, ‘Wow, it seems like it’d be hard to start a podcast,’ or ‘How do I do that,’ I guarantee you, anyone can do it. And if you want some help doing it, reach out to Andrea and her team. She does a wonderful job. The Creative Impostor Studios once again. We’re going to have a link over to her website on this episode’s webpage. So check it out.
Next thing. We’re going to talk a little bit about the psychology of decision-making today, and to dive deeper into that, really you need to pick up a copy of Value-Added Selling. We have an entire chapter dedicated to the psychology of decision-making. So check out your copy of Value-Added Selling. It’s available wherever you get your books. We’re now on the fourth edition, that’s the most up-to-date edition.
So let’s get back to that question: How do you sell value when the customer complains about price, but they told you that they want value? That’s really what we’re talking about here. The customer tells you, “Here’s what I want, but I just don’t want to pay for it.” So at a basic level, we need to figure out the disconnect. We call this buyer dissonance. When a buyer tells you one thing, and then they tell you something else, we need to highlight that gap.
So here’s an example. Let’s say the customer says to you, “Hey, I want quality. Quality is going to be the most important thing.” And then, all of a sudden, when you give them that quality solution, they start to focus on price. And then they say to you, “Well, that price, that you’re expecting us to pay? That’s way out of what we were expecting to pay. We’re just not going to be able to do that.” What you need to do is highlight the difference between what the buyer says and what the buyer is doing. Remember, when people make decisions, they like consistency. Your buyers want to make sure that their words and what they need, they want to make sure all of those things align with what they actually do—meaning, what they actually purchase. So our goal is to highlight the difference between what they’re saying and what they’re actually planning on doing.
So that’s the goal here. When we’re talking to a customer, and let’s say the customer tells us quality and performance are what really matters. And early on in our discovery call, we’re asking about their needs, what’s important, what they’re trying to accomplish, they’re going to give us exactly what they want. They’re going to tell us in detail, what’s important to them, why it’s important. This is when we need to go back to that conversation.
When we present our price and they say, “Well, your price is too high,” we can say, “You know what, Mr. Customer? I’m having a little trouble understanding here. You mentioned that the price is a little too high. Let’s take a look back at what we’re really looking to achieve here. Early on in our discovery meeting, you mentioned that the quality is going to be critical, that performance is going to matter. What we put together here, Mr. Customer, is a unique solution to satisfy that need to ensure quality, to ensure performance. All we’re doing here is putting together a solution that is consistent with what you need.”
What we’re doing there is we’re trying to take the focus off of price and put the focus back on what they really need. The furniture industry, by the way, is a great example of this. Let’s say you’re talking to a customer and the customer mentions, “In our industry, image is really important.” Now you’re talking to them, let’s say you’re selling furniture. You’re a furniture salesperson. And you’re talking to the owner of the company and they say, “We need to build a corporate campus here that really promotes the image that we’re trying to create in the marketplace. An image of success, an image of, quality, performance,” and all that. Okay, that’s wonderful.
Now when you present your solution and they tell you, “Hey, the price is just too high. That furniture is way more than we expected. This is way outside of our budget,” we can go back and say, “You know what, Mr. Customer? I understand that maybe there’s a difference in the price from what you were expecting, but let’s go back and look at the real need for what we’re trying to do here. Earlier, you told us that your image is going to be important. You’re trying to build that image in the marketplace—an image of success, of performance and quality. Wouldn’t it make sense to ensure that the furniture we’re putting in here is consistent with the image you’re trying to project?” And again, what we’re doing is we are highlighting the disconnect. If they’re thinking about price, they’re thinking about the wrong thing that they should be thinking about quality, performance, and how they define value. Success is the other thing they mentioned.
Another thing. I remember talking to a group of salespeople that, they were talking about the customer’s company. So they’re meeting with their customer and the customer was talking about their business, where they plan to grow. And the salesperson just casually asked the customer, “Hey, if we were to talk to your customers, why would they say they work with you? What is it about your company that they continue to come back?” And the owner of the company said, “Oh, it’s our people. We only hire the best. We pay more so that we can have the highest skilled labor. We pay a higher wage than most of the other employers out here because we want to pay for the best.”
Now, the salesperson was a genius because he took a mental note of that and he filed it away in his mind. And when he presented a solution to that customer shortly thereafter—he was selling a capital-type of equipment. And when he presented his solution, the customer, of course, “Man, the price is just higher than we were expecting to pay. I just don’t know if this is where we’re going to go.”
And, and he [the salesperson] said, “You know, Mr. Customer, earlier, you told me that your people are the ones that make a difference, and that’s what your customers said. And you went on to tell me that you pay more, you pay a higher wage, so you can have the best employees, the most knowledgeable ones, all that stuff. Wouldn’t it make sense to put the best people and match them with the best equipment? I mean, if you really want to gain the most value, if you really want to set yourself apart in the marketplace, just imagine how powerful that would be having the best people with the best equipment. The last thing we would want to do is jeopardize your image by giving your people substandard equipment.”
And so when he highlighted that difference between what the buyer says and does—that disconnect—he was able to take the focus off of price. That’s another way that we can do it.
And one final thought, one final example. This is back when I was selling in the construction industry, and I remember I was calling on this prospect for months and months and they would not call me back. It was so frustrating. You’ve all been there in sales. You know what it’s like. And finally the customer called me back and he said, “You know, Paul, I’ve, seen your card here. I’ve seen your catalogs here. Every time I see them, I just throw them in the trash.”
You know, at first I didn’t know what to say. I just kind of paused for a moment. And then I just said, “Why?” I go, “Why do you throw them in the trash?” And he explained a long story about the company who I was working with at the time, how they previously messed up and they didn’t handle it right. So it’s understandable. And I was talking to this guy and finally, I got him to agree just to meet. So we met a couple of times. We started to talk; I uncovered their needs, and we certainly could help that company. So I gave him a couple of ideas, a couple suggestions, especially with one of our core products that I knew would be a game changer for him.
And so I presented it to him and he said, “You know what? Let’s do a side-by-side comparison.” He goes, “You know, Paul, we have the most productive employees in the market.” He goes, “Our employees stick with us because we take care of them and customers call us continuously because we take care of our customers. So we take care of our employees who then, in turn, take care of our customers.”
I said, “Okay. Let’s do a side-by-side comparison here. Let’s make sure that your productive employees have the most productive tools to help them.” So I showcase one of my tools. Again, I was selling in the construction industry. It was a diamond coring drill, and we were doing a side-by-side comparison. I was drilling a hole, same size hole, same concrete. And he was drilling a hole with his old equipment and with his drill bit as well. And I’m not kidding you. I beat him. I mean, it was, it wasn’t even close. I mean, I was done, and he still had another couple of minutes before he finished drilling his hole.
And so I proved the point. I showed that our tool was better and that it was more productive because me being an inexperienced guy, not even, I mean, I know how to demo the tool, but these guys live and breathe it every day. Even in that, even the fact that I beat him, I presented our solution and he said, “Your price is just too high.” He goes, “It’s just more than we’re willing to spend.” And I remember telling him—and his name was Chris—I said, “Chris, here’s the deal. You said you have the most productive employees.” I go, “Your productive employees wouldn’t even stand a chance against a less productive employee using the same tool. If you were to buy this tool, you would almost have an unfair advantage in the marketplace because you’re going to have the best people using the best tools. If you want to be the best, you’ve got to use the best.” And so I highlighted that gap between what he was saying he wanted to achieve and what he was actually doing.
And when I did that, he was able to change his mind. He agreed that that made sense and we were able to work out a deal. And he ended up switching those tools over to our company. That is the key, when the buyer just shows the dissonance between what they say and what they actually do.
Make it a big day.