Do Not Sell Price If You Don’t Have a Buyer…
You need to know if you have a buyer showing interest in the value of your offer before you present price.
My wife and I wandered into an art gallery recently. We were on vacation, pretty relaxed; admiring the work around the gallery.
The gallery’s owner politely approached us. Though we were not focused on any particular paintings, he seemed to think that because we were looking at a group of art at the time that we might be interested.
Fair enough… but before he even gauged our interests or surmised our thoughts he proceeded to tell us how he was willing to sell those pieces for very a low price. What price meant or low meant I had no idea.
I had no appreciation of the art’s value. I knew nothing of the style, the artist’s background. In fact, I wasn’t even particularly focused on the art, nor did I have much chance to inquire before he began to blurt out that it was on sale.
I never asked the price, but he insisted on telling me the price further on in the conversation. I became skeptical and lost interest in the conversation.
So what’s wrong with his sales approach?
- He dismissed the value of the art before he even knew if he had a prospective buyer;
- He never asked any questions to listen for indications of the prospect’s interest in this art work or something else;
- He didn’t initially describe the artist, the work, or other intrinsic value that might appeal to us;
- He led with price and later a price point as his offer before he knew if we were interested in an offer;
- He gave away any value the art might have had or the potential for a higher price point.
The result is an uninterested buyer and no sale. Unfortunately he likely believes that by promoting price for an item such as art that this is the path to a buyer and sale… It’s not…
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Peter Klinge, Jr. is an executive and adviser for small to mid size companies. His firm’s purpose is to help owners, employees, and other company stakeholders achieve their desired growth potential.
Peter … A brief anecdote but very important point you make! Price has no meaning whatsoever until value has been established. Otherwise, there would be no need for consumer “brands” and everyone would just buy the least expensive “product” in any given category or segment (let’s call them “store brands” to be kind.)
In consumer marketing we always talk about the price/value equation as reigning supreme, and it does. But if I ran the zoo, I’d reverse the formula and call it the value/price equation because the former determines the latter, with perceived added-value benefits driving what people are willing to pay for them.
Similarly from a B2B perspective and as an agency new business expert, just imagine what my client prospects would think of me or my agency brand if the first thing I said was that our prices are lower. Like you in the art gallery, they would instantly tune me out and walk away. Probably never take my call again. Talk about crashing and burning!
Even in the employment market, the best of headhunters always tell their candidates to avoid compensation discussions until they know the potential employer really wants them. The list of other illustrations goes on.
All of which is to say and to your point: First establish intrinsic brand value; then set and discuss price; and then, maybe, offer a “deal” incentive to close the sale. Hope this helps. Bill Crandall
Appreciate your contribution and insight
Great message! I think all business owners should read this… It really comes down to empathy: what does the customer want? If there is a personal value to me, what does the price have to do with anything? Then, as you make clear, the price reductions simply serve to give the impression of devaluing the product.