Wednesday, August 8, 2012
How to Handle the Price Objection and Other "Money Issues"
By John Chapin
Four Keys to Overcoming and Eliminating Price and Other Money Objections
1) Question the objection.
Less than 25% of people who give you a price or money objection are giving you a true objection. Usually when someone gives you a price objection it is either because they are testing you or it's simply the best objection they can come up with to get rid of you. When you question the objection you determine quickly whether or not this is a real objection and, if it is, what areas you need to focus on in order to eliminate it.
If someone says it costs too much, you might ask, "How much too much?" or "Compared to what?" If they say they can't afford it, you might ask, "What can you afford?" or "How much are you paying now?" or "When do you see that changing?"
2) Stay confident and positive.
Many salespeople get defensive, nervous, or otherwise uncomfortable whenever they get a price or money objection. When this happens, it is an immediate red flag to the prospect that something is off with your product or pricing. First and foremost, realize that you will hear price and money objections a lot, so don't be surprised when you do. Second, the better prepared you are to answer the various objections, the more confident you'll be, so make sure you have some strong responses. Finally, be proud of your prices and what you have to offer. If you have higher prices than the competition, it is undoubtedly because you have a higher quality and overall "better" product. Believing in your product and your ability to handle price and money objections will lead to a confident, positive response when you get one of these objections. When you are confident and positive, the prospect gets a comfort factor that you are being honest and straight-forward.
3) Build value.
The kneejerk reaction of most salespeople facing a price objection is to immediately look for a way to cut price. When they do, it lowers the perceived value of the product or service. Instead of dropping the price, the goal should be to build value
What are your primary benefits? How are you, your company, and your product better than the competition? What about your service is better? Is it your claims department, your back office people, or do you respond faster? Are clients always assured of getting a live person on the phone? Accentuate your primary benefits, know your unique selling proposition, know why people deal with you as opposed to competitors, and find the most effective way to clearly convey that message to prospects. Provide proof with testimonials, user lists, references and the like. Also remember, you are the one thing your competition does not have. If you are determined to bend over backwards and out-service and out-deliver the competition, others won't be able to compete. Tell people that you are more committed than anyone else and then back it up with action.
Note:From time to time you will run into the true price shopper. When you do, unless you are unequivocally the lowest price provider and that is your primary selling point, your best bet is to run the other way. People who buy solely on price will waste more of your time, complain more, show no loyalty, and many don't pay on time. If you do everything you can to build value, differentiate yourself from the competition, and show why your product is worth more and yet you continue to hear, "Nope, I'm buying solely on price", move on and let your competition deal with the headaches.
4) Avoid price and money objections altogether.
Of course the best way to handle price and money objections is to never get them to begin with. The most effective way to do this is to first, ensure you have a qualified prospect who is ready, willing, and able to buy. Second, have a powerful presentation which specifically addresses all the prospect's needs and desires, clearly shows you as the obvious solution, and creates urgency to move forward now. Finally, your presentation should end with a smooth transition into a relaxed, no-pressure closing process which starts the relationship off on the right foot.
Bonus Tip - Your best bet is to be prepared with superior product knowledge, selling skills, and the calm confidence that the prospect both needs and is far better off with your product or service. And now I'd like to offer you a free white paper on what it takes to be successful in sales along with a free monthly newsletter at http://www.completeselling.com
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