One of the most common objections salespeople, professionals and business owners encounter is the dreaded Price Objection. While the wording can vary from prospect to prospect, the gist is, “That’s too expensive.”
Fearing the loss of the sale, too many sellers respond by immediately dropping their price. While this can sometimes close the sale, it’s usually unnecessary, meaning that most salespeople are needlessly throwing away profits.
Because the statement “That’s too expensive” doesn’t mean “If you don’t cut your price I won’t buy this.” What it really means is any one of a number of things. Here are some of them:
• They’ve never bought this type of item before and have unrealistic expectations.
• You haven’t fully educated them about the value of what they’re getting.
• They’ve seen the same product somewhere else for less.
• It’s beyond their budget.
• They’re comparing it with another product or service they believe is comparable.
• They don’t understand the dangers of buying cheap.
• They were planning to buy from someone else all along and just needed a second bid.
• It’s more than they had intended to spend.
• They just want to see if you’ll drop your price.
• The factors that make your product more expensive aren’t of value to them.
• They’ve never spent that much before.
• They’re trying to start a bidding war between you and your competitors.
• You’re showing them a more expensive option than they need.
• They’re cheap.
The good news is that most of these issues are relatively easy to deal with. And most of the others (they’re cheap or they’re trying to start a bidding war) are situations you don’t want any part of.
The key is to ascertain which of the above scenarios is really occurring. So when confronted with a price objection, ask your prospect, “What do you mean by that?” And keep probing until you uncover the real issue. Dealing with that will enable you to close the sale and keep your profit margin, both of which are essential to long-term sales success.