Selling: The 3 Aspects of Price
By Conor Kenny, Teacher, Trainer, Writer, Founder of conorkenny.com
"We lost it on price" said Mr. Average Sales 'Professional'
"Too dear" claimed Mz. Average Sales Executive.
"They didn't have the budget" huffed the Sales Rep.
"Complex but, in the end, we lost on price" explained Mr. Sales Director
"They loved it but just felt we were bad value" said Mz. Understood Sales Manager.
Heard it all before? Maybe a little too often?
Selling is not simple, it's complex. Equally, there is a fine art to making the simple complex and earning the right to a sale. Naturally, there are multiple facets, reasons and more to successful selling but allow me to slay the argument that "It was price, price, price". Yes, of course price matters but if your answer is always price then you're misunderstanding your customer.
For me, there are 3 aspects to price. Not 1 but 3.
Every service, every product and every business has a 'cost'. That's simply a combination of providing the service or goods at a profit. Curiously, many businesses are not that scientific about 'what they need to sell at' but often 'just add a margin. Still, cost is the base line and, unless there's a compelling long term strategic reason, it makes no sense to sell below that base line. This is number 1 and, says you, quite obvious. I agree but there are 2 further factors that few people consider. They follow.
If most people follow, understand and agree with the 'cost' paragraph above then few graduate in their thinking to really consider and understand 'value'. How often has a sales person added the immortal words (unprompted) "and that's really good value".
Those words are not owned by the salesperson in the sales process. They are the prerogative - only - of the customer. Let me tell you why.
'Value' is utterly subjective and it is also personal. Is a luxurious sports car, watch or mansion good value? Is the washing powder good value? Is your dentist or doctor good value? I don't know but I do know that answer is in the gift, head and opinion of the customer. You see, my idea of value is related entirely to my need, circumstances, income and much much more. You simply cannot tell me something is good value.
To help, here is my simple definition of 'good value';
"A price I am happy to pay for what I got"
Think carefully the next time you're tempted to impose your view. It might just kill the sale.
"What's it worth to me?"
There are only two types of sale - ever. Sometimes the two overlap, sometimes they don't. The first is 'practical' and the second is 'emotional'. Each has a complex set of drivers and mini rapid fire decisions but each is entirely different to the other.
Booking a wedding reception is a highly emotional purchase. Buying the weekly detergent a little less so. The first trick is to make sure you know which is which - in your customers eyes.
What we rarely know is "What is this worth to my customer?" It's not their job to tell you nor even your job to find out overtly. Still, it is a huge part to successful sales and one rarely considered in selling or even a sales strategy.
Bobby was a fisherman all his life. His Trawler moored in the harbour most nights at around 8pm. It was always a long day and Bobby looked forward to his 2 drinks in the Pub overlloking the harbour on his way home. For over 50 years, Bobby relished the chat, company and unwinding at this simple little Pub before heading home to the family he adored. When he was in the Pub, he used to love the fact that he could keep an eye on his Trawler as the sun went down and the twinkling harbour lights grew brighter.
Bobby died unexpectedly. Everyone was shocked. Arrangements had to be made and that included the gathering after his funeral. The family were distraught and money was always tight.
"Where will we go after the funeral?" asked a cousin "To the Inn by the Harbour of course" said his Son.
It was never going to be any other way. Why? because, to his family and memory, it was worth it.
My question for you, the next time you're selling is simple; "What's it worth to you customer?" Of course, they might say "A lot" or "A little" or "Nothing". Your job is to move from "I think" to "I know"