Price Pointers

In case you’ve missed the news flashes, the Recession is getting better. Even Jim Cramer seemed strangely optimistic this week on “The Today Show,” advising Americans to “hang in there” because housing and the stock market were showing sure signs of improvement. He even predicted better times in the future.

How does that trickle down to the man or woman on the sales frontlines? Even though the news is good, you still might not be feeling the joy when it comes to your bottom line each month. Maybe you're still sweating it because it's tougher to close customers when they're keeping such a close watch on their cash.

Here's a common scenario:

Let’s say you’re a salesperson who is working hard to sell high-end equipment that’s costly. You really believe in your product and know that it would make your customer’s life more profitable. Your buyer falls in love with the product and hangs on your every word. They have a laundry list of questions that pre-Recession would indicate to you that they’re about to close the deal. You can feel their excitement and know that they realize how your product can make their life better.

Then you hear the fateful 2010 most-used line: “I really want to purchase it, but I’m worried about the price.”

What should you do? The first thing is that you need to find the positives in this situation. In other words, the sale is not lost. You just have to work a bit harder here. Whenever you are selling high-end high-relative priced products you have to develop value in excess of the price by presenting in a conceptual-value added manner. At its simplest, that means you don’t sell what it is—you sell what it does. You don’t sell the steak, you sell the sizzle.

More than ever, customers are worried about shelling out their cash reserves. The good news is your customer has the money to buy from you, but you need to convince them to open their checkbook. If they’re still hesitating and using price as the reason then it’s fairly evident that there hasn’t been enough value created by the salesperson.

How can you create more value?

First, call out the value added options available in this model versus a lower priced, lower featured model. I wouldn’t dwell on a single feature that might be meaningless when it comes to benefits. Instead, focus on all of the features – even if they only give your customer a small amount of value. Put together with the larger value features and you will have sound information to convince your customer that this deal is a true no-brainer. Your goal is to give your customer a slew of reasons that validate opening that checkbook. They will never have to second-guess this purchase because you’ve helped take any doubt away. They know in so many ways that this is the way to go.

The next approach is to “life-cycle” cost out this model. Remind your customer that this investment will benefit them for many years, if not decades. The value of opening that wallet today will mean saving dollars far into the future. Say to him or her: “Look at all the value you are receiving today for years of value to come for only this many dollars today.” A $1000 product that lasts 20 years has a life-cycle-cost of $50 per year where as an $800 product that lasts 10 years has a life-cycle-cost of $80 per year. What looks better to you, $50 or $80 per year?

People are looking to make high quality purchases because they can’t afford products that lack dependability or durability anymore and realize that their foolish spending days are over. Drive home the point that your product will “go the distance” which ultimately will save them money.

The old adage holds true: You get what you pay for.

Now, they’re ready to pay for quality and you’ve made the sale.