There is no sale without a pricing objection.
When a monetary angle comes into a buying decision, every buyer wants to win the deal with negotiation even if the product or service is the right fit for them.
Proof –
Did any of the prospects in your entire sales career accept your quoted price upfront?
If you have offered a product for $100, prospects have a complaint about the price. If you have offered the same product for $99, they still have a problem. Trust, had you offered the product straight for a $50 deal; they still look for some more price negotiation.
This is never-ending and buyers always want more proving right pricing in the eyes of the buyer is a myth.
Then how some of the sales people are winning deals or can win deals? In my experience, it is possible by asking right probing questions to uncover the buyer’s actual buying criteria and elevating value from your deal in the eyes of the buyer. Of course, other factors mentioned below combined will do the magic.
- How important is your deal for them and how soon do they want to sign the deal? This reflects the need and urgency of the prospect.
- Are you replacing something that is already available or is it a new problem or need that your deal can address? This throws light on the possibility of delay in deal closure due to price negotiations so the buyer can continue existing vendor services until they achieve their desired pricing from you.
- Are they evaluating your competitors? Statements like your prices are too high, you are too expensive are a sign of alternative offers on their table which they are comparing with your offer.
- Another important information you need to know is if they have any budget constraints that are making them negotiate hard even if it means not signing your deal and not addressing their problem for the time being. But be cautious in asking questions related to this as this can put the buyer in defensive mode.
Your preparation and ability to take control of the whole buyer’s journey will put you in a better position to navigate smoothly with the objection raised
Solution –
1.Start elevating the value in your offer
- Show them some of your happy customers, testimonials, statistics, credible ROIs for clients.
- Align the features, benefits, and advantages from your offer to the buying criteria identified.
2. Sharing Line-Item wise pricing
In your proposal, break down the pricing for each element which is part of your total pricing depending on the objective of sale as bundled offers have different pricing.
Ex: I created a proposal for a prospect who was looking for a data centre for migrating all his workloads and client data. I proposed pricing for workloads separately and client data separately. During price objections, I could justify the total high price by simply explaining to them that safeguarding their clients’ sensitive data requires storing it separately from the internal workloads and hence this pricing. This shows the value we are referring to in this deal.
I quoted other allied services separately like management fees, annual maintenance, dedicated customer service, and multiple or sub-data centres etc. I had a lot to play when the actual objection began.
3. If your client is looking for discounts
Do not jump into offering discounts instantly, rather tell them that you can offer small discounts but will have to remove a few line items from the scope of work mentioned in your proposal. If the prospect insists that the total scope of work remains unchanged, it means they are interested in a complete package. Here you can probably ask them straightaway what price will be comfortable to close this deal immediately. Do not give them time to think.
4.If they have a budget constraint
If budget is a constraint, the prospect may ask you about other offers and solutions that you have or may ask you for services for a shorter duration. Do not be aggressive to make your point or push your initial offer. Instead, you can rework and share a couple of solutions to fit in their budget. This way, you are not losing the deal and keeping the trust with the client.
5. Dealing comparison with competition pricing
Be honest and do not defend yourself against competitors. The biggest mistake most of the sales guys make is quickly jumping to talk wrong about competition or over-providing some information that is not relevant to the buyer. How amazed your prospect will be if you appreciate what your competitor provides and then subtly say I have something unique that no one in my competition has. And to add, give a human touch to it by saying that you do not need a sale but a customer with whom you want long-term relationships.
6. Dealing with first time buyers
The prospect has never brought such a product before and has no idea how it works. Hence give them some POC and let them relate the experience and value for the price quoted.
An objection is not a rejection; it is simply a request for more Information.”
Conclusion –
When Objection comes do not be defensive. Acknowledge and showcase the value by differentiating that the best products always have a value and a cost. Indeed, a lot of objections can be avoided by better qualifying the opportunity at the start.
This article is contributed by Sankaran Chandrasekharan.
