On Wednesday I did a training with one of the local Chamber's of Commerce about objection handling. Immediately afterwards I got several comments about how great that training was, and how much people struggle with handling the price objection. Then yesterday I saw an entire thread in one of the groups I participate in, about people using price as an objection. Then today I had someone else tell me that price is their number #1 objection.
Okay Universe! I can see the writing on the wall! Here's my response!
I was actually a little bummed by the comments I heard on Wednesday, read on Thursday, and then heard again today. That people are too cheap, it makes the sales rep think poorly of someone who claims to use "too expensive" as an excuse, or that people just don't understand what they are paying for.
My response is pretty simple: people will almost always find the money they need to get what they want to get. If they are using money as an excuse then they need to be educated and it's your job to educate them.
Now before you run off pouting that I just called a bunch of people out on their beliefs, let me explain. And before I get to that, understand that I too have been given the price objection. I just view it differently than most people do.
Whenever you really, truly want to do something, almost nothing will stand in your way, especially not something as simple as finances which are rarely a definite factor (in that, you can almost always go get more money for what you want to do). But so often I hear the "too expensive" excuse because the prospect doesn't know how to verbalize their thoughts or sometimes they just don't want to for fear of hurting your feelings.
Whenever someone tells me that I'm "too expensive" my first realization is that the price I've quoted them is not on par with the value I'm providing. At least, not in their mind.
Everyone has a price/value seesaw in their head and on one side is Price and on the other side is Value and if Value isn't way weighted down, the price will always be too much.
It's important to know that not everyone's seesaw is the same as everyone else's - and so you will run into people who's price/value seesaw isn't even remotely similar to yours, and unless you can show them why the differences exist and help adjust their seesaw, you'll have a very hard time getting past the "too expensive" objection.
But in most cases, when you provide enough value, in their mind, the price is never an objection - in the rare instances it is from there, it's often because they had a pre-conceived price in their head, or have already reached out to receive additional funding and literally cannot afford you.
People use the price objection for three main reasons:
1) It really is out of their budget.
2) They don't feel that there's enough value to be worth the price.
3) They feel that someone else will be able to provide the exact same service for a cheaper price.
In the first instance, the prospect has only set aside or only has so much money for the product or service and it's well out of their budget, and well out of their wiggle room. With these clients, unless you can adjust the pricing to fit their budget, you cannot win their business. At least, not right now.
With the second reason, it's a matter of education. They don't understand why it's so expensive and why they need all the bells and whistles attached. They don't see enough value. For them, it is the equivalent of paying for 10lbs of chicken and only getting 7lbs. Why would anyone do that? Your job as the sales-rep is to show them that there is an extra 5lbs worth of value in the seasoning and the organic labeling and the fact that you didn't pump your chicken full of water to inflate the weight artificially.
Finally, the last reason is, usually, based on education as well. If your prospect has done research and there are other options out there offering a major price difference for, as far as they can see, the same product/service, they will be reluctant to pay your price unless you can show them additional value to make up for the price difference.
Price is my favorite of what I call the "false objections" - the objection that your prospect gives you because they don't want to give you the real reason they are harboring because it's either too embarrassing, or too personal and they don't trust you enough.
Often times, if you spend time to earn their trust in the beginning, spend the meeting educating properly and then investigate thoroughly, you can uncover the true objection, and can then decide from there if it's worth making the adjustments to your proposal to earn their business.
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