Lowering Your Price Could Cost You a Sale

For some reason, many salespeople assume that lowering the price of their product will lead to an easier sale.

Here’s the truth: You will make more sales by NOT lowering the price of your products.

Why?

There are many factors that influence a customer’s decision to buy, and price isn’t the most important. The problem is that YOU think it is. Focusing on price actually distracts your customers from what is most important to them, and diminishes their motivation for buying.

Here are five reasons why lowering your price could lead to a lost sale:

1. It makes you look like your competitors.

Do you really think that your claims of having the lowest price will make you stand out? Every other salesperson says the same thing. Everyone claims to have the lowest prices because they think it will get the customer’s attention.

Well, price is really the least effective differentiator in business. The only way to look different from your competition is to act different, and offer something that no one else can offer. A lowered price won’t cut it.

2. It distracts you from your customer.

Price does not determine the sale; your customer does. That means that your attention should be completely on them. Everything you do should help you understand and connect with your customers to discover their motivation for buying.

Customers search for a product that is the best solution to their problem. They understand that a product cannot be the lowest priced and still be the best. Making the sale requires that you find the best solution, not the cheapest.

3. It decreases the perceived value of your product.

Before every purchase, a customer considers, “Is this worth it?” The answer depends on the value of the product, not the price. If they can envision themselves using and benefiting from the product, the answer is yes and the purchase is made.

Without value, a product won’t be sold at ANY price, so don’t limit your customers to the dollar amount. Establish value by helping them imagine how useful and enjoyable your product could be in their daily lives.

4. It questions your integrity.

Customers will not buy from you if they don’t trust you; and they definitely won’t trust you if they feel that your price is dishonest. Lowering the price of your product suggests that your product is not really worth what you are asking for.

Defend the price you have set because you know that your product is worth every penny. Have confidence and enthusiasm for your own product. If you believe in what you sell, your customer will, too.

5. It leads to buyer’s remorse.

Customers want to feel confident in their purchase and know that they received the best value for their money. Lowering the price for your customer puts them in a situation where they feel haggling is necessary. They will question their purchase and wonder if they should have pushed you harder to lower the price.

Even though it seems you saved them money, they will probably feel ripped off. This will make them uncomfortable with your business and less likely to come to you in the future.

When you lower the price of your product, you are limiting your sales strategy to a dollar amount. Price becomes a dominant part of the conversation ONLY because YOU have made it one. Focus your attention and sales presentation on what really matters: the customer, the value, the uniqueness of your company and your product. When these things are put first, price will always come second.

Tom Richard conducts seminars on sales and customer service topics nationwide. Tom is also the author of Smart Salespeople Don't Advertise: 10 Ways to Outsmart Your Competition With Guerilla Marketing, and publishes a free weekly ezine on selling skills titled Sales Muscle. To subscribe to this free weekly ezine go to http://www.tomrichard.com/subscribe