SALES BULLETIN
PRICING STRATEGIES
What are the most important steps someone can take immediately to begin realizing the highest price?
I have an acronym that explains how to approach the price issue, and coincidentally, the acronym is….
PRICE
P stands for prepare - know more about the customer and your competition than they know about you.
1. SURVEY THE FACILITY.
2. GATHER ALL INFO ON THE CHEAT SHEET.
R is for: relate to value. Be careful! Higher-end products and services have lots of features that bring value.
Customize your recommendations by discussing only those features that will be perceived as valuable; to
that particular prospect.
1. DETERMINE THE BENEFITS MEYER PROVIDES
2. WHAT ARE THE PURCHASERS HOT BUTTONS
I is for illustrate what you say, so the customer remembers. 80% of the new information they remember will
come through the eyes. And retention is up 600% when you show them what you tell them.
PREPARE A SURVEY PRESENTATION.
C is for control the conversation. This does not mean you should control people, intimidate or pressure
people. It means you need to control the emotional flow of the conversation. You need to relax and intrigue
people within seconds. You need to create trust, credibility and urgency before recommending anything.
1. TITRATION DEMONSTRATION.
2. REFERENCE FROM EMPLOYEE OF PERFORMANCE DURING PRODUCT DEMONSTRATION.
3. IS THE PURCHASER BUYING IN?
E is for expectations - the belief you will get the sale; at the right price.
1. ASK FOR THE ORDER.
2. ASK FOR THE ORDER.
Preparation: To sell at the highest price you need a more defined selling system and the discipline to stick to
it. The sequence is critical. Connect to all decision-makers as soon as possible or at least, identify them. If
you're selling to executives, know their basic info in advance of the call. Always have a compelling opening
and give evidence of any preparation.
Sell the customer on answering your questions by offering one or more reasons why this is important for
them. Never approach this task without all your questions written out. After a complete examination, offer
your recommendations to all decision-makers whenever possible. This takes real discipline. Ensure you ask
a "feeling" or "opinion" question after each feature to determine whether they've bought it. Don't wait until the
end to ask for the order. There was too much info to be digested at once.
Good preparation also means you know a lot about your competition and your customers other choices. At
some time you will have to compare yourself, whether they bring it up or you do. Sometime during the sales
process, you'll have to educate the customer how to buy what you sell without becoming too technical.
In a highly competitive market, personalization is critical. Most of my clients have differentiated on the
product or service level. Since the sales rep is the key element in the earning of trust and credibility, it's
critical that he or she is seen as "different". The best way to do that is to complete a thorough examination
based on the customer's best interests before a recommendation. Most sales people don't and won't invest
the time.
Relating to values: Examining lots of markets; one out of six people are real price buyers. This means the
first (and perhaps only criteria) is price. But 5 out of 6 buyers will consider value and price. Here is what
makes this difficult. We have been taught to relate to benefits. Most companies prepare a list of benefits that
cover every prospect. You need to customize your presentation to the particular values that customer. You
can oversell by presenting too many benefits or the wrong ones. Also keep in mind that a more sophisticated
presentation doesn't need to be a longer one.
Illustrate: Illustrate everything you say in one way or another. When you are the highest price, the
presentation needs to be an emotional experience by including as many senses as possible. You must also
speed the decision-making process. The longer it takes to make a decision, the more logic takes over; the
more likely the decision is negative. Most new information people accept is through the eyes, but use as
many of the senses as possible.
Control: Control is critical in a competitive market because you need to know more about the customer than
the customer knows about you. You can assume control in the beginning of the conversation by saying
something they didn't expect to hear. No matter; you need to define what you do and for whom within the
first 25 to 30 seconds.
You must convince the customer to do the talking and to let you do the asking. Also, don't send proposals
without speaking with all decision-makers or, at least knowing their names, what they want in the proposals,
(which means an agreement to the features included in the proposal) and a decision date.
Expect to close: Believe you can do it but don't be ignorant about the facts of life. Someone will always have
a lower price, there will always be price objections, you'll always lose some business to lower prices and if
you appear the same as the competitor, the decision is more likely to be made on price
What do people overlook when setting their price? Their "real" costs. Sometimes they think they can set a
lower price because they haven't factored in all costs.
It's easy to say that you can get the highest price, but when faced with the possibility of losing a sale, many
salespeople cave in. How can they keep that from happening? There are two ways to keep that from
happening. First, know when to say no. Know your costs. Know your margins and draw a line in the sand
before you begin negotiation. Second, you have to be able to afford to say no. You need another place to go
to, other business to turn to. Part of the discipline of selling at a higher price is to know how many prospects
or leads are needed to earn a definitive number of yes's.
A bigger problem can be that the company and the rep lose credibility when they discount without a valuable
reason. And many companies compound this problem by opening new accounts with the hope that they can
raise the price later. These are lost accounts waiting to happen.
Under what circumstances do customers become less, price sensitive? When they trust the salesperson to
never tell a lie, when they trust the rep with invasive information, when they see the rep as an adviser and as
an advocate and of course, when the rep and the company ensure the client's time and efficiency
expectations are met.
How can you quickly tell if you've come up against a price-conscious customer? This can rarely be done
accurately AND quickly, but when price comes up early in the conversation, it's usually the sales rep usually
introduces it - although they all deny it.
The bigger problem is that people use the price language early when it isn't a price objection. It's more often
a stall, tactic, some condition or a misunderstanding and those need to be handled differently.
Selected Reading for Overcoming Pricing Fears and Objections
Crush Price Objections
by Tom Reilly
How to Sell at Prices Higher Than Your Competitors: The Complete Book on How to
Make Your Prices Stick
by Lawrence L. Steinmetz, Roger Dawson, Jim Cathcart
Value-Added Selling: How to Sell More Profitably, Confidently, and Professionally by
Competing on Value, Not Price
by Thomas P. Reilly, Tom Reilly