Many business owners have a major problem when I suggest that they increase the PRICE of their product or service. Let’s face it, if you could easily increase your PRICE by at least 10%, would your business be more profitable? I bet he would! Increase to Your Customers Sales & Startup Tips.
So why don’t they increase their price? The answer is simple … because many business owners have the mentality that price is the only determining factor that their clients use to decide to do business with them.
Have you heard this one? My industry is so competitive that I have had to keep my price low, in fact, I have not increased my price in the last 3 years or so.
Customers Sales & Startup Tips
I bet there’s a big chance you made that statement. And if you have, how close are you to bankruptcy?
Here is a challenge. Increase your PRICE by 10% NOW. Keep doing it TODAY. And then, plan to do it again in 3 months.
Show me that you have done it in the next 5 days (since July 17, 2003) and I will give you a FREE copy of my new book,
Your right to be rich: the 9 laws of the wealth of speed without bulls
Does this challenge make you feel a little nervous? I bet some of you would lose sleep because of that.
The truth is that a lower price can increase sales. But the effect may be that, if the price is low enough, it can be sold directly out of business.
Do you consider yourself a good seller? A salesperson who always has the lowest price on a product or service is an order taker, not a salesperson.
I appreciate for many that the last few years have been difficult. There has been the impact of GST, increases in wages and retirement and all kinds of things that have reduced business profits. The fact is that it is not possible to compensate for losses by increasing the volume.
If the lowest price ever equals automatic success, the market would consist only of Hyundai and K Marts. The Mercedes-Benz and Myers businesses around the world would have to close their doors.
What is the solution? Well, in addition to increasing their prices by 10% overnight, there is a great need to increase their education. I refer to this as increasing your level of incompetence. Your future success will be achieved by acquiring knowledge. You must learn to increase your price without losing sleep.
Highlight your benefits
Never talk price before value Sales & Startup Tips. Successful companies realize that reducing the price to the bone recently to increase sales unless customers want or need their services. More importantly, these same companies have discovered that customers buy value, so providing more value than their competition is the answer.
People naturally focus on price. This is because dollars and cents are specific and tangible products that facilitate comparison.
If you buy or sell a house, you naturally want to tell your friends about the offer you got. Tell them you have a great price! However, what about the quality of the home? Do you need major renovations, is it adequate for your needs or are you missing 2 rooms?
When making a serious investment or negotiating a commercial purchase, much more than the price falls on the table.
Adding value makes the whole business bigger. To make the deal bigger, you must put more elements in the agreements that are negotiable and carefully point out those advantages to the other side.
What is in value? If you are discussing the price and it turns out that you produce the best quality product, the other person may be taking this quality for granted. To make the sale, you must highlight this point.
When I once bought a car, a seller focused too much on the price. As I always think that the sale price of a car is too high, we immediately began to haggle (and it was a real bargain) over the price. The seller left us nothing more to discuss.
Then I went to another dealership. And he was offered the same car at the same price. This intelligent “friendly persuader” took the time to show me how to buy at this dealership was far superior to buying elsewhere. He noted his fastest delivery time, the longest reputation in business (most reliable) and better financing. It made a lot of sense and I ended up buying them.
Adding value to an agreement and, therefore, making the agreement larger, correspondingly increases dollars and profits. By identifying all other benefits besides dollars and cents, you increase your chances of getting the agreement.
Remember that value is relative to customer perception. You can only offer value if you know what your customer values or thinks it is important. Identify this by asking questions and identifying the needs and wishes of your customers. In addition, if you add items or customize the product in any way, the value of the product increases in the eyes of the customer.
This is the perception of which we speak. If your client determines they want pizza with extra cheese, then give that person pizza with extra cheese.
Adding value is easy
Once I gathered a series of information tapes for a new product that I had developed. I went to a supplier and asked them to produce the first 2000 copies. Another supplier called me and said: “We will not only produce the set, but we will pack it specifically for you and deliver it wherever you go.” This provider continued to point out these benefits in detail. Naturally, I changed providers.
My old provider called me and wanted to know why I changed. I told him that I had received all those additional things at the same price from another provider. He said, “Well, if you had asked me those things, we could have done them too and I wouldn’t have lost your business.” Never talk price before value Sales & Startup Tips.
How sad it is … a difficult lesson!
If they had bothered to find out my wishes and needs, I would not have needed to change providers.
Remember! It is not up to your customers to find out what is available … it is up to you to inform them.
When the price does not count
Let’s put the price in perspective by asking a hypothetical question. If you or a family member required a heart transplant or other serious surgery, would you buy the lowest price?
It is not likely!
I would undoubtedly shout “I want the best!” Some might even say “Find the most expensive surgeon there is!”
If you were on trial for your life, would you find the cheapest lawyer? In fact, you can even take pride in telling your friends that you have the most expensive lawyer in the city.
OK. These examples may be a bit extreme, but there is a clear objective … … to save my life at any cost. A serious event raises little need for discussion.
What happens in less critical circumstances? Are you identifying the objective of the customers you need to buy your product or service?
Know the motivation of your buyers
Some buyers buy to feel good.
Although buyers talk about prices and rationalize their decision-making process, the reality is that they generally make purchasing decisions to meet their psychological, emotional or physical needs.
Let’s go back to your last purchase decision. Was it a new suit or a new dress, maybe even a pair of shoes? Did you buy the cheapest one or was it your decision based on the event you were going to attend, someone you had to impress or how comfortable you were …
People buy with emotion and then rationalize it. You know, I can wear that dress again when we go to that charity dance later in the year. That model car will have a better resale value even though it now costs a little more.
Why do people buy Porsche? I’ll tell you. In fact, I had a test drive one the other day. It was fantastic! There I was driving on this thing, bending the corners at twice my normal speed (it was really good) quickly doing the calculations. Yes, it was going to cost me another $ 1,000 per month, but I was quickly trying to rationalize why I should get it.
Guess what occurred to me? My existing 4WD Pajero does not give me the “driving experience” of the Porsche. There you go. My number 1 reason to “need” a new car.
Customers buy for profit
Consider generic brands in a supermarket. Generic brands are usually produced by the same manufacturers as their favorite brands. The list of ingredients is essentially the same. These generic brands are generally sold for less than name brands.
Why are generic products not the best sellers?
Never talk price before value Sales & Startup Tips. The truth is that consumers distrust, they feel uncomfortable with generic brands. Does it look the same, does it have the same taste, the same texture, the same quality, the same nutrition?
I have seen people in supermarkets choose the highest-priced items instead of generic brands over and over again. They trust those brands and voluntarily pay more.
A profit-oriented sales launch
A profit-oriented sales presentation is much more effective than a thousand-word characteristics-oriented sales presentation. First, turn your features into benefits …… then make the sale.
Here is an example of features. A vacuum is often upright, one end has brushes, the handle is about 1.4 meters long, the color can often be gray, burgundy or green.
Turn that into benefits. The machine cleans the skin of the dog and cat from the sofa, vacuums peanut shells from the carpet, remove dirt from the carpet, is light and will last a long time. The plastic exterior will handle bumps and scratches.
Get the image?
Let’s add something of value. In addition to the standard features, this vacuum cleaner comes with an extra-long cord to get from one room to another. You no longer need to disconnect and plug the vacuum when you make different rooms. You will also receive 3 spare bags to ensure that the suction power is not reduced as the bags wear out. You will also receive a free service within the first 6 months after purchase.
There you go. Buyers will weigh all options and choose the product that is most valuable to them, usually the one with the highest added value.
Find all the added value in your product and be sure to give your potential customer all the benefits of choosing your product over your competitors.
This part may sound a bit technical, but believe me. If you can incorporate this into your sales process, your sales will go through the clouds.
In each scenario of buying and selling there is a need to identify the objections of the buyers.
During a negotiation between buyer and seller, the seller has provided features and benefits of the product to the buyer. The buyer is at the opposite end of the negotiation and has identified obstacles to the seller’s price labeled as real and emotional needs. Never talk price before value Sales & Startup Tips
Here is typically what happens. At first, the buyer considers the price to be very high, at the top or even beyond its limit. For every obstacle that the buyer may present, the seller must remove it. If the seller cannot eliminate this focus on the price, the price will fall. If the seller can eliminate the obstacle through benefits and value, then the price will not be discounted.
The sale occurs when both reach an agreement and the price is proportional to the obstacles … or the value.
What does the seller need to do? You need to poll with the right questions and stay very attentive. Once the “needs” of the buyers are discovered and the true “objections” (real and imaginary) are revealed, the seller can lead the process to resolve the “needs” and overcome the “objections” by delivering benefits and solutions.
In a nutshell:
Identify the needs and wishes of the buyer and then solve their problems by delivering specific benefits and solutions to meet their needs and wishes.
Know the reason why the customer buys you
Here is a classic example of how business owners learned a dramatic lesson about their customers.
John, a consultant, and coach in the heating and air conditioning industry advised his assistants about an upcoming seminar to bring a sample of bills. During this seminar, John asked Alan to join him on stage with his bills.
John reviewed each invoice and asked Alan why each had bought from his company. Alan was sure that a large part of his customers bought him according to the price.
John pulled out a speaker, chose an invoice and asked Alan to call the customer. “Call someone you think buys you because you offer a lower price,” said John. Alan dialed Mr. Armstrong’s number.
Mr. Armstrong answered the phone. John explained that he was conducting a survey of recent buyers and asked Mr. Armstrong if he would mind saying why he chose Alan’s company as his supplier.
Armstrong said: “I am in the late 70s. I may not be much longer and I wanted a company that would be in business after I left. That way, my wife has someone to call if she has a problem. “. Mr. Armstrong continued: “I know Alan is one of the 3 brothers who took over his father’s business. I figured there was a good chance that one of them would still be present in 10 years if necessary.”
Just to verify, John asked Mr. Armstrong “What about the price?”
Armstrong replied: “Alan was not the cheapest, but he was competitive. In fact, I checked the company that was cheaper the other day and you know what … … they had gone bankrupt.”
There are two valuable lessons in this story. How can you be a great seller without knowing why your customers buy from you? Your perception could be based on wrong assumptions.
The other lesson is that many of us are guilty of putting too much emphasis on the price, believing that the price is what buyers focus on first. Price plays a much smaller role than most buyers think.
Never talk price before value Sales & Startup Tips. So what steps can you take to eliminate this emphasis on price? It is not enough to increase your prices without first understanding how you can overcome this in the minds of your customers.
1. Differentiate ……… When pointing out the benefits for your prospects, it highlights the differences between your product or service and that of your competitors.
The ways to differentiate are endless. If it does not differ, it has nothing to offer more than the price.
2. Focus on the benefits … By focusing on the benefits that your buyer wants or needs, you are, at the same time and as an additional benefit to you, keeping that person’s mind out of the price.
3. The uniqueness of the product … Before you can support and defend your price, you must know the unique characteristics of your products and be able to translate these characteristics into benefits for the customer.
4. Negotiate price concessions …… If your buyer really wants a price concession, you must decide if you can grant it and still survive. Only then can you decide if it is better to make the sale or if you should withdraw from the deal.
Maybe you can provide a reduced product without reducing quality. How about a ½ day seminar instead of a 1-day seminar? You may have a standardized product line with a silver, gold or platinum service standard. Maybe if they paid in cash instead of 30-day deadlines.
These are all legitimate ways of negotiating price concessions without discounting their price and eliminating profitability.
5. And finally … Increase your price by 10%. Do it today. You will be surprised that most customers don’t care.
When buyers talk price
The next time your buyers just want to talk about prices … listen carefully.
Discover what they value in addition to the price. If you are not talking … … ask questions.
Develop a sales pitch that eliminates price as the only factor.
I have seen this work many times. Apply this to your business and see your profits grow.
Become a Successful Marketer!