Learn to accept price objections for what they are… opportunities in disguise.
They are a sign of an interested customer, and with practice and skill, you will
be able to overcome them (without cutting your prices!) So don't interrupt or
try to handle the objection immediately. Listen carefully and patiently to what
they have to say.
2.
Make sure you understand the objection
Do this by repeating your understanding of their objection back to them ie
"So, if I have understood you correctly, what you are saying is..…"
Do not carry on until they have confirmed that your understanding is correct.
3.
Acknowledge the customer's point of view
"I can understand why you might say that. In fact, one or two other
clients started by saying much the same thing to me in the past...."
4.
Answer the objection
Continue from step 3 by saying something like:
"…. but what they found - and I'm sure you'll find the same thing
- was that...."
If they are objecting to the price, complete this sentence by using one or
more of the approaches set out in the "Price objection handling strategies".
5.
Check that your answer has met their concern
"Does that make as much sense to you as it does to me?"
6.
Ask for the business
"So would you like us to go ahead?"
If the customer still objects, go back to step 1 and start again.
If this still fails, ask more questions to help you establish their needs and
the value to them of meeting those needs.
Price Objection Handling Strategies
Strategy
How to Use it
Postpone
Postpone talking about prices until after you
have demonstrated the value. "Before we can discuss prices we both need to
be absolutely sure that we are right for you. So, if it's all right with you,
we'll come back and discuss the price in detail when we both know what you need."
Make the value obvious
Paint a graphic picture of what is at stake,
quantify the value, and help them to understand how it will make them feel.
Break into chunks
Break down the price into small chunks, such
as cost per use or per week. "And you can enjoy all those benefits for just
£2.97 a week"
Compare to them
Compare your prices to theirs. "Tell me,
are you always the cheapest supplier in your market? Well, neither are we. Like
you, we charge a fair price for great products and services. And that's why I'm
so excited about working with you. But if all you want is the cheapest widget
on the market, I can introduce you to several cheap firms from whom you'll get
exactly what you pay for."
Compare to rivals
If they tell you that Fred down the road is
cheaper, say something like:"I am sure Fred knows what his widgets are worth.
Just as we know what ours are worth. And that's why ours aren't the cheapest on
the market."
Give them a choice
"Most customers looking for this level
of service are prepared to invest (£middle). A fortunate few can invest
between (£high) and (£very high). And then there are some on a budget
who can't go above about (£low). May I ask which of those three categories
you fit into most comfortably?"Start by mentioning a (£middle) price
that is about 20% above the (£low) price you would be happy to receive.
Then quote a (£high) to (£very high) range that is about 50% to 100%
above your (£low) price. Then tell them the (£low) price - which you
secretly know is actually the price you need. This taps into the subconscious
belief that Expensive = Good, and that Cheap = Bad. And, as a result, many customers
will accept one of the other two (higher) prices.
Focus on the difference
Focus on the difference between what they say
they are willing to pay, and what you are asking."You'll get all the extra
benefits you were getting so excited about a minute ago for just £4.27 a
week more than you're paying at the moment. That's a big return on a very small
investment, isn't it?"
Change the package
Strip out some elements of the package to bring
the cost within their budget.
Easy to pay
Remove the "we haven't got the money"
objection by arranging finance or accepting credit cards
Reverse the risk
Reduce the customer's risk - perhaps with a
money back guarantee
Trade
Trade something valuable for a price cut eg
prompt payment, larger order, long term commitment, special deals on their products,
sales leads and referrals etc.
Walk away
If all else fails, be prepared to walk away
- or perhaps introduce them to a lower cost supplier who will pay you a commission
for the sales lead!
