How To Deal With The Price Objection

Ever feel you've done the 'hard work' of getting in front of a potential client...

...only for things to fall apart when it comes to discussion of price?

This should help you...

One of my clients - let's call him John - had struggled with the price objection.

So I asked John what went through his mind when he heard the price objection.

He told me honestly, ‘panic!’

So I asked him: ‘what do you fear they’re saying to you when you hear the price objection, John?’

What John said next was very interesting...

...see if you recognise this, OK?

He said ‘well, if I’m honest, I suppose I think:

• They don’t think I’m worth it
• They think I’m overpriced
• They must think I’m greedy
• And therefore, the only solution is to drop my price!’

I said, ‘I understand that. But actually you’re mind-reading.’

‘The thing about price objections like "the price is too high" is you will hear them for any number of reasons...

...which can include all the following and more:

• I think the price is just fine… but I always say it’s too high because inexperienced sellers drop their price every time I say it!
• I don't really care about the price but I want to show my colleague here what a good negotiator I am
• I don’t have the authority to make the purchase
• The price is not too high but I don’t want to take the risk on a new supplier and have it blow up in my face
• The price is fine but I enjoy making salespeople sweat and bartering with them (tip: buyers who have themselves been salespeople often do this!)
• I didn’t actually understand what you’re offering but I’m too embarrassed to tell you that
• We’re in financial trouble but can’t tell you that
• I’ve already decided to hire the supplier who took me to a strip club but we’re getting you in so I can tell the board we looked at three quotes
• You remind me of my Dad / sister-in-law / ex-partner / someone who bullied me at school so I’m going to get my own back!' ☺

I could see John's face change as he absorbed this new perspective...

Because once you know this, you can't un-know it again!

Key thing is:

Do you notice how some objections contain a kernel of validity and some do not…

...or are at least are not what they seem at first glance?

The truth is, the most price-sensitive person in the market is YOU!

I will accept that for maybe 10% of buyers the price is factor number 1 but for the other 90% it just isn't...

And the biggest irony in all this?

You will actively PUT OFF a lot of people by presenting a price they consider too low.

Why is that?

Because they associate low price with low quality.

Think about it for a microsecond:

Luxury goods would not exist if all anyone cared about was price.

It's a nonsense to imagine price is the be-all, end-all for most people.

The evidence is all around you that it is not...

(...even in your own life, if you care to look at - say - your last 10 purchases).

Anyway, following on from this...

As I explained to John, there are just two golden rules to remember in order to handle price objections properly...

...and if you observe these two rules, they will solve 90% of your problems, OK?

The two golden rules to handle the price objection

Rule number 1:

Never accept a price objection without investigating it.

If someone says ‘your price is too high,’ you don’t say ‘oh, please forgive me for being so greedy, let me see how far I can drop it.’

No!

The correct response is ‘oh that’s interesting, why do you say that?’ or ‘too high in relation to WHAT?’

Next time the price objection crops up, you flip into Columbo-mode, OK?

On no account do you attempt to answer.

You're Columbo.

You investigate, ok?

Rule number 2 is:

If you EVER consider dropping your price for a prospect, you ONLY ever do it in return for a trade-off of some kind by the other party...

(As an aside: it's usually better not to negotiate... and there's a reason the 'O' in my OUTPITCH Framework stands for 'Options.'

It allows people the ability to self-select...

And it gives you a lower investment option you can offer people to 'trade down' to.)

If you must negotiate, you find out what they are asking for, and essentially you say:

‘If I can do that for you, what can you do for me?’

You ask that question for two reasons.

One, because - I hope - you arrived at your pricing based on a logical, level-headed calculation based on cost to provide, value to the client, and what the market will bear.

So you don't just chuck all that away lightly. You don't 'make concessions.' You trade concessions. There are no 'free lunches.'

Two, you ask it because otherwise, the person you're speaking to has no reason to ever stop asking for more and more and more, do they?

I learned that in this book a long time ago and have applied it ever since.

It has served me incredibly well for years and years.

I recommend it.