Helping You Learn to Hear “Yes”.
Helping You Learn to Hear “Yes”.
How to Present Price Effectively
As we all know, in a negotiation price is almost never the only factor that determines the good or bad outcome. There is always at least one other factor along with the price which decisively influences the final outcome; in other words, if the only obstacle to the successful conclusion of the negotiation is price, in most cases the two sides can find agreement. Let's look at three ways to best present the price of our product or service and maximize our ability to successfully conclude the sale.
1) Never talk about price until you have explained value.
Jeffery Gitomer is renowned for saying that people hate to be sold but they love to buy. Therefore there is a great proliferation of shopping malls in our cities in Italy; places we feel we can freely choose what to buy without the pressure of a seller perhaps using some subtle technique to manipulate us. In addition, each article has a price tag on it so we can immediately attach an economic value to what we see and evaluate immediately whether we prefer to keep that amount of money in our pocket (or bank) or exchange it for the pleasure or utility that the product can produce in our lives.
In the case of a direct sale, which requires the knowledge and skill of a professional vendor, the price has completely different role. The potential customer, as we begin to introduce our product, often has in mind one question, “How much is it?” To unveil the price too early in the presentation is a very common mistake of inexperienced salesmen. The priority, in fact, must always be to communicate and explain the value of the product before communicating its cost. For example, if a customer asks me too soon the price of a product I am presenting, my response is, “Dear customer, the price is the best part of this product and I will cover this subject shortly, but first I want to explain why this product could solve that problem of yours you mentioned earlier, improve your life, etc..”
2) Break-down the price as much as possible
The same price can be communicated in different ways and have a completely different impact on the buyer. If I am presenting a nutrition program based on food supplements, which cost 100 USD per month, it will be my duty, when I go to communicate this price to the prospect, to affirm that the program costs “only 3 USD a day.” In this way the potential customer’s mind is focused on the daily price, comparing it with how much they already spend each day for food, rather than focusing on total spending of 100 USD. I'm not lying or trying to manipulate the prospect, I am just presenting the same information from a different angle, which, after all, is exactly the object of the study of persuasion.
3) Explain the price in relative terms
If I have to sell a training course worth 1,000 USD, I will address the issue of price as follows, “The COST of this course, which is what is necessary to the company that organizes it to cover the costs of educational materials, rent the hall, pay the people who work the event and the speaker, is 1,000 USD, but its VALUE is at least 100 times higher. If we were to charge for the value of this course, we would have a price so high that very few people could afford it.
And, in the case of a book, “The price written on the cover is just what the publisher needs to cover the printing costs, the supply chain to bring it to the library and ensure a minimum profit to the people involved, but its value is also much higher. If the prospects objects, stating 1,000 USD for a training course is too much, I can put the price in relative terms with the following reasoning, “Let’s say you make with your job 1,000 USD per month. You probably earn more than this, but let us make this conservative assumption. If a person you completely trust in these matters, suggested you to invest in a stock, which can give you a sure income, would you be willing to invest each month 10% of what you are earning now? Now, if you are not aware of this, I inform you that investing in yourself can give you, in time, a return infinitely superior to the best stock today on the market. How many training courses and seminar do you attend each year? (If the person did me the objection of the price, the answer is almost always zero). If you decide to invest only 10% of your monthly income on yourself, in less than a year, you put aside the amount you need for this course.”
By adapting these three factors to your product or service, you can greatly increase your chances of closing a sale, provided always that you are proposing a valuable product at a fair and competitive price and assuming your primary goal is always to help people, rather than simply to earn a commission!