If you’ve been in sales longer than half-an-hour you’ve probably heard this from a prospective customer when you asked for the order.
Your price is too high.
It seems as if some people say it before you even get the price fully disclosed—it’s more of an automated response than an actual objection. They know their lines and they are going to get them out. But, it’s still an objection, isn’t it? We still have to overcome it, don’t we?
You aren’t going to get very far in sales if you don’t know what to do when you hear, your price is too high.
What do you do when someone throws those five words at you? How do you respond? Do you have a standard, go-to response you can use? If not, you should because we both know it’s coming more often than not no matter what you sell.
Hopefully, you’ve got a way to overcome the objection or at least a way to defend your price. If not, I want to submit an approach that may be new to you—or slightly different than how you’re currently handling it. But, one I want you to consider trying and seeing if it works for you.
Compared To What?
Your price is too high.
“Compared to what?”
Granted, when you answer their objection with, “compared to what” you have to do it in a sincere manner—not in some condescending tone. I want you to ask it in an inquisitive, meaningful way. “Compared to what?”
The reason I ask this is because I really do want to know what they are comparing my price to? If I am selling a $100 pair of shoes and the prospect says they are too high, is it because they are comparing them to an off-brand that’s not “worth” half that price or because they only have $85 and should be looking at a different style?
When you answer their price objection this way, the customer is most likely going to respond with something along the lines of, “What do you mean, ‘compared to what’?”
The Real Question
This is where you are going to find out the real issue because when I ask, “compared to what?” what I am really asking the client is whether it is an affordability issue or if I am simply out of the budget they have set of this project/item/program/service or whatever.
“What I mean is, is the price too high for the program/product/service/item you’re looking for or are you saying the price is too high for the value you see in it?”
Now, I’ve asked them to take one of two roads: it’s either a money issue or I may have been selling them the wrong item or program for the budget they have. Either way, I need more information other than simply, “your price is too high.”
You can expect some people to answer, “Both.”
“Now, Mr. Prospect, I understand your position, but it can’t be both. Is it outside the scope of your current budget or do you not think it’s worth what I’m asking for it?”
Then let them answer.
They will tell you
If you sell automobiles you may have them on the wrong vehicle or they may not have the down payment or the monthly not may be $20 too high. But, you have to find out before you just simply drop your price.
Too often we (yes WE) drop our price because it’s the easy way to handle this, but it may not even be what the prospect needs.
For example, if I’m showing a $400,000 home and I hear, your price is too high, do they think this particular house is not worth that or should they really be looking in a totally different neighborhood? Because if you cut the price to $375,000 and their budget is $300,000—it wasn’t the price it was the product. I was showing them the wrong home!
Many of these can be avoided if we do a better job at qualifying our customer—and I know sometimes we want to shortcut that and get right to the meat of the matter. But, the more time you spend qualifying the less time you’ll spend overcoming price objections because you’ll have a much better idea of what your prospect is looking for and what they need.
“Compared to what?”
Whatever they say, is where you need to focus your attention and where the sale should go next. Don’t just start dropping your price at the first sign of a price objection. Perhaps you need to be presenting them with a different model or solution. Maybe you’ve misunderstood what type budget the prospect has to work with. Whatever the case, instead of immediately dropping your price, “compared to what” will allow you to dig a little deeper and isolate the customer’s real objection.
It could be they can’t afford it. If that’s the case, it’s not that your price is too high, their budget might be too low—or they may be looking at the wrong program for their budget.
I know what you’re thinking, “Butch, you’re a genius!”