Dave Brock, President and CEO of Partners In EXCELLENCE, just wrote a good piece on his Partners in Excellence blog titled, Price is Never the only decision criteria!. As a top sales consultant, Dave has been encountering an increasingly number of clients’ reps that cite Pricing as the first thing customers want to know.
Here’s a short excerpt:
“I have to admit being a little frustrated. Over the past two weeks, I must have done a couple of dozen opportunity reviews and deal strategy sessions.
One of my usual questions, fairly early on, is: What are their decision criteria and priorities? 100% of the time, the response is Price! And I wait….. but there’s silence.
‘Tell me something new, price is always an issue. It may be their top issue, but it is never their only issue! What other things are they going to base their decision on?’ Over 80% of the time, I get blank stares. ‘We don’t know, they keep focusing on price.’ is the response from the sales person.”
As sales professionals, we have all dealt with the occasional customer that seems keenly focused on price and won’t focus on anything but price until they are satisfied. This used to be rare but is now becoming the norm, even for traditionally complex products and services that must be configured to solve a specific problem.
Solution or Price - which comes first?
It seems we have hit on the proverbial “which came first, the chicken or the egg?” problem. How can a rep give a price for a complex solution if the customer hasn’t yet disclosed what they perceive the solution to be?
I am seeing an increasing number of top-earning sales and marketing folks discuss this trend.
Ardath Albee recently wrote an article One Content Asset Can’t Do Everything that included the following:
“We’ve got to talk to them about pricing first. Otherwise they’ll think they can’t afford our solution and they won’t engage.
* Does your prospect care about pricing if they don’t even know that the product or solution is valuable to them based on their goals and objective?
* How will your buyer even evaluate the idea of budget or funding if they don’t know much about the potential impact of what you’re selling?
* Context > Understanding > Interest > Confidence > Engagement”
Solving the problem of customers asking for pricing
I disagree slightly with Ardath’s “Context > Understanding > Interest > Confidence > Engagement” model only because some of the steps require a potential customers TIME, and time is valuable. Content is certainly king but the volume of content around each and every solution may simply be overwhelming the interested prospect.
What many may be reading as an obsession with Pricing may actually just be an initial filter to reduce the number of solution providers that can be considered. If a prospect can use budget fit and eliminate some of the potential vendors then they can do a “deep dive” on their short list choices. Putting this in the context of Ardath’s model, I would simply insert a single, additional step called BUDGET FIT, like so:
Context > BUDGET FIT > Understanding > Interest > Confidence > Engagement
It may sound crazy but how can we ask prospects to spend their valuable time learning and researching our solution unless they know they can afford it?
I believe many sales consultants are misreading the statement “the customer is only interested in price” as meaning the customer already knows what he wants. In fact, customers are still receptive to sales people that can help them and they will engage much easier if they know their time is being spent on an affordable solution.
One way to accomplish this without over- or underestimating a potential solution is to provide “sample” pricing of other projects. This would not be an apples to apples comparison but rather would satisfy a prospect’s need for pricing so they could then focus on their needs.