What do you do when people under bid their prices just to get your clients?
Answered by:
Richard Gadberry
Murphy Business & Financial Corporation - Dallas
The opposite of selling on price is to create value.
Marketing / Selling Factor 1: When there is no perceived difference in value of the product or service; then price wins almost always. Example: you are sent to the store to buy salt. there are many different brands of salt. Morton's Salt, is $3.00, Fred's salt is $1.50. You look at the back label and the contents are exactly the same. Why would you spend $3.00 when you can buy the same thing for $1.50?
Marketing / Selling Factor 2: When the perceived value of the product or service is clearly understood, price becomes less of an issue. Example: You are buying a new TV. there are many brands of TV's and lots of choices. But you have always bought Sony or Panasonic. So you purchase the brand you are familiar with. It's because the perceived value of buying Sony, was greater than buying on price.
Marketing / Selling Factor 3: When the need of the product is so great, price is not an issue. Example: Its Saturday morning and you are having a party at your house tonight with 50 people (before Covid). You wake up to water all throughout your house because your toilet in the main bathroom blew up. Are you going to shop price? Are you going to get three bids and interview each one, check references... No, you are getting the first company that can be there today, no matter the cost.
The moral of the story: the more value of the product or service that you can create for your clients; it will overcome price. If you are disagreeing with me right now; its because you are not creating value and selling professionally regarding your client interactions.
Lastly; there is an old saying in sales that says "you can't close a person you can't close". It means that not everyone is your client. You can sell all day to a person with no money or who can't make a decision, so learning to qualify first, make sure the person or company you are selling to can actually use or need the product or service, has the money to buy your product or service, before changing your selling process and getting frustrated that the sale did not go through.
I agree with you on this. Unfortunately most clients don't seem to understand that the customer service we provide saves them money no matter how we explain it.
100% agree! I used to take the time to explain why we were different/better. But I quickly learned that to someone shopping for price alone, it doesn't matter; and I shouldn't waste my energy chasing them or fretting over them. When costs go up elsewhere, they'll be back around, and then they'll be gone again once they find something for a penny less no doubt! But if I can turn a project around quickly and help a local business that's in a tight spot, or deliver on quality for a discerning client, or continue to provide a service that others aren't or can't--those are the clients that are going to stay a while. And if the price on their custom print stock changes with market value, or production costs go up on specialty services because the prices on other consumables or arranged custom services have increased, they are going to understand; and, they will either be fine with the cost or engage us for recommendations on changes to reduce without overly affecting the quality of their finished product or their image/branding.