I’m conducting sales training all this week, and one of the things I emphasize early-on is selling on value, not price.
Now that’s much easier to do because we’re not selling a product that we paid amount of money for, or that the customer can get from the store down the street. We sell advertising, and the value in advertising rests on one thing, and one thing only: Will I make more money in additional revenue than I will spend on this advertising?
So if you sell a service, if you are an account, an attorney, a web designer, or an architect… then here’s how you can sell on value and avoid the low-cost limbo.
Value comes down to whether or not your customer thinks your widget is worth $5,000. All you need do is show him how it will make his life a little bit better. If your customer says your price is too high – he’s right. Unless you’ve proven value, any price is too high.
In order to sell on value, you must understand the relationship between price and value. Cost must be discussed and agreed-upon, but never outside of the context of achieving your client’s objectives and what he’s going to get back in return for your services.
Let me give you an example by asking a question: Is $2,000 dollars a lot of money?
To answer that, you will immediately try to contextualizing it in your mind by comparing that $2,000 to something else… like your paycheck. Or your mortgage. If you live in California, $2,000 might not seem so expensive compared to what you’re actually paying for your mortgage each month. If you live in another state, you might think otherwise. The point is, we all try to put a dollar figure into context to determine if we think it’s “a lot of money” or not.
But the actual thing we should be comparing that $2,000 to is not something like our mortgage. We should compare it to what we are getting back in return. When your prospect is stuck on price (or starts talking about his “budget”), he’s looking at what he has to spend, rather than what he’s going to get. If your prospect hasn’t considered what he’ll receive in return, he’ll be forever focused on price instead of value… unless you help him see it differently, that is.