William Shakespeare penned this famous line in Hamlet, “There is nothing either good or bad, but thinking makes it so.” Two people can experience the very same thing and one person views it as good while another person sees it as bad. This happens because when we make judgments about good and bad we’re making them in relation to something else.
If you’re in sales and I asked what objection do you face the most when trying to make a sale, I have no doubt the vast majority of people reading this would say, “Price!” When someone says your price is too high it’s because they’re comparing it to something else.
Is $20,000 a lot to pay for a car? Some of you reading this don’t think so because you may drive a high-end car like a Mercedes or BMW, and your ride costs much more than that. Others might view $20,000 as expensive because you’re not into cars and therefore pay a good bit less than that for your vehicle of choice. In both cases, you’re comparing what you’ve paid in the past to $20,000.
As a salesperson here’s what I want you to remember:
“There’s nothing high or low but comparing makes it so.”
The next time you face the price objection, recognize this simple fact and then look for ways to ethically change the prospective customer’s point of comparison.
In the end everyone wants to feel like they got a good deal or great value. In our sales training we define value as follows:
V = WIG / P
Value (V) equals what I get (WIG), divided by price (P). If I can get more for the same price I feel like I got a better deal. Or, if I can get the same thing but pay less, I still believe I got a better deal.
This is where you’ll see advertisers tout “25% more” or “2 for 1.” In both cases you get more (WIG) for the same price (P). On the flip side we see sales all the time. During a sale we get the same item (WIG) for less money (P).
I’ve often shared the following example in training.
A company in Southern California sold spas and hot tubs. Prices ranged from $6,000 on the low end to $15,000 on the upper end. As you might imagine, most salespeople started low and tried to upsell customers. The problem with that approach is once you start at $6,000 the $15,000 spa seems very, very expensive…by comparison.
During a consultation with Robert Cialdini it was mentioned that people who bought the $15,000 spa used it more than some rooms in their homes. The logical question was – how much would it cost to add an additional room to a home in Southern California? Most people said anywhere from $60,000 – $80,000. Ah ha! A potential new comparison point!
Dr. Cialdini advised the spa client to start the sales process with the $15,000 spa and weave the room addition question into the sales conversation. It might go something like this:
Salesperson – “Customers who bought the XP5000 spa love it. In fact, many say they use it as much or more than any room in their house and quite often use it to entertain. If you were to add a room to your home how much would that cost?”
Customer – “I don’t know, maybe $60,000 or $70,000.”
Salesperson – “Well I have good news. You don’t need to spend $60,000 or $70,000 to get that enjoyment because the XP5000 is only $15,000.”
And how well did this approach work? Sales for the high-end spa rose 520% in the three months following the change in sales approach. In the three months before the change, the company only sold five high-end spas. In the three months following the change they sold 26 spas!
No new advertising, no television commercials, and no price discounts were needed. All of those approaches would cost a good bit of money. Instead they simply tweaked their sales conversation to include a legitimate new point of comparison.
So for my salespeople out there, here’s your take away when dealing with the price objection – “There’s nothing high or low but comparing makes it so.” Look for legitimate comparison points then weave them into your sales conversation. If you have a good product that’s worth the asking price you should see sales take a nice jump up as you reframe how customers view your price.