The prospect likes your proposal. You feel good. They’re leaning your way and say they’ll get back with you on Monday with their decision.
Sounds promising, yet you wonder, “Why the wait? Am I missing something?”
They ask you to come in Monday at 3pm. You get there, take a seat and they inform you that at the last minute, a not so well known competitor came in 15% lower than your proposal.
The customer says, “I know you worked hard to give me your best offer, but unfortunately, their price is too attractive to reject – I have to go with their solution. I know you understand. It’s hard to argue with logic, right?”
If you’re like most sales people, your jaw drops and you freeze.
That’s the problem. The easiest way for a competitor to get their foot in the door is price. Decision-makers rarely entertain bids at the last minute unless they’re offered a lower price. It’s a language that every customer understands.
But let’s look at the hidden opportunity. When the customer says, “You can’t argue with logic”, they’re correct! But customers don’t typically make decisions based solely on logic. They make them based on emotion 80% of the time, then justify the decision we make with logic.
When they offer ‘logic’, you can redirect the conversation to one that is based on value. A discussion on value shifts the conversation from logic to emotion, a powerful step in your direction. Talking about solutions engages our emotions to succeed, diminishing the logic of cost.
Leading the conversation about the benefits of your solution helps the prospect see that value goes beyond price. Competitors can rarely match your value, forcing them to either drop out of consideration, or to further lower their price.
Price-oriented competitors hope decisions are made only on price – that’s the only value they know how to offer. Thankfully, you will have a list of value propositions that more than make up for the difference in price.
What other value can you provide?
Value is made up of several benefits that are important to customers:
Combined, these benefits add up to the “Total Cost of Ownership” where value is more clearly defined for the customer.
Make sure that you have answers for each of the benefits listed above. What is your unique value when it comes to service? Your delivery? Capability? And, so on. Study these benefits and be prepared at any time to share them with your prospects and customers.
And, remember that value is defined by the customer and they may be seeking other benefits not listed above. Your job is to identify their priorities, and then work to meet them, regardless of whether they match you or your competitors’ expected ideas. When price becomes an issue, refocus them on the value you provide. Value supports and justifies your price. Your competitor can only support their price based on their value not yours.
When the customer clearly sees your value, they will not object over price. You should usually expect prospects to obtain two or three other bids, which is okay. Your goal is to have your proposal become the benchmark against which all competitors will be judged. If they do, you have an excellent chance of winning the business.
Don’t get caught in a bidding war by reacting to the competition and their offer.
Your best approach is to sit down with the customer and discuss your solution and the value you’re delivering, ignoring the competitor. It’s their job to justify their offering.
Focus on the customer and their needs and how you can meet those needs. That’s the foundation of selling value which satisfies the customer’s emotional side.