Best Practices for Overcoming the Price Objection

This is the third installment in the Overcoming Objections series. This blog article is focused on the most universal objection that all sales professionals face - the pricing objection.

Every customer wants the most “bang for the buck” and especially today, must make every purchase dollar count. Therefore, pricing is top of mind for them in many selling conversations.

Confidently and skillfully handling pricing objections is key to success for every sales professional. This post covers best practices for overcoming price objections, providing clear strategies that help sales professionals tackle this issue with confidence.

Dollars and cents

When Your Customer Asks About Pricing Early in the Conversation

Pricing discussions that occur right off the bat rarely result in a positive outcome unless you can alter the conversation to focus more on overall value. When the conversation is all about price before you have identified customer needs (goals, aspirations, etc.) and established the value in your solution, you will seldom win. You will not salvage the conversation or the sale unless your product is the least expensive option.

Resist the urge to respond with pricing information immediately. Instead, you can say: “Can we both agree that pricing is always an important consideration? Because it is so important, we will review the pricing in detail. Can we also agree that in addition to price, other considerations will determine if this solution is the right one for you? Let’s find out if I have a solution that provides you with exactly what you’re looking for. If not, then the price is irrelevant anyway."

Once your customer agrees, you can proceed with your probing strategy to uncover needs, priorities, and decision criteria. "Tell me about the other factors that will go into your decision…”

Focus the conversation on all the other factors and how your product provides benefits equal to, or greater than the price. This equates to value.

The advantage in postponing your response to the price question is that you will have been able to create value for your product rather than have it viewed as a simple commodity where the only purchasing consideration is price.

If your product or service provides benefits your customer had not yet considered as part of their purchasing criteria, ask if you can suggest a few additional things for them to consider. This approach allows you to introduce additional decision factors and criteria where appropriate, which can build even more value into your value proposition.

Only after discussing all the factors should you reveal the price. By taking this approach, you have gained the opportunity to have a robust selling conversation so you can identify and understand customer needs and goals, align your solution to their needs, and differentiate your product rather than just focusing on a pricing discussion. That gives your customer the chance to make a more informed and wise purchasing decision - and you the opportunity to make a sale!

When Your Customer Has a Price Objection Later in the Conversation

Animated pricing discussion

If pricing is brought up as a concern or objection after you have fully understood their needs and presented your product, you must handle the pricing question more directly.

For instance, when you have presented your pricing, your customer said: "Your price is too high!"

This is when you need to ask questions and listen carefully to their response.

Examples may include: “Help me understand what makes you say that?” or, “What makes you feel the price is too high?“ Or “How much too high is the price?”

You can have them identify the gap. What do they think the price should be, and why? Perhaps they have a rational and valid reason. If so, it is important for you to understand what that reason is.

Your customer may be trying to evaluate whether or not the value your product provides is worth the price to them. That is, they are interested, but uncertain or skeptical. Show them that the value is there, and you will earn their business.

Perhaps they are protesting your price but have no real basis for doing so. They may be fishing for a discount. By asking the right questions you get more information with which to proceed more effectively.

If they have a firm budget, then they may be challenging you to see if you will lower the price. There are times when customers offer a pricing objection because they truly don’t have the budget for your solution. When this occurs, reflect, and determine if you properly qualified the opportunity to begin with.

Offer Flexible Pricing Options

If the upfront cost poses a challenge, consider providing flexible pricing options. Tiered pricing plans, payment plans, or discounts for annual commitments can make your offering more accessible. This flexibility allows customers to select an option that comfortably fits within their budget.

For example, consider offering three pricing tiers: a basic plan, a standard plan, and a premium plan. Each tier could offer increasing levels of service, which helps customers find a price that works best for their needs. Be sure to point out any potential long-term savings your product might bring, such as reduced maintenance costs.

Address Comparisons with Competitors

Let's compare!

When customers compare your pricing to competitors, be ready to address these comparisons directly. Research your rivals' prices and features so you can effectively position your offering. Highlight your unique advantages, such as superior customer service or additional features that enhance value.

For instance, if a competitor's product is priced lower but lacks critical features or offers poorer support, emphasize your product's benefits. This could be framed as, “While Company Y offers a lower price, our dedicated customer support team ensures that you have assistance whenever you face issues.”

A best practice is to never bash your competition when discussing them. A better and more professional approach is to "compare and contrast."

Use the "Feel-Felt-Found" Technique

The "Feel-Felt-Found" technique can be particularly effective in addressing price objections. This method involves acknowledging the customer’s feelings, sharing experiences from others, and showing how clients have found value despite similar concerns.

You might say, “I understand your question about the cost. Many of our clients felt the same way initially. However, they found that the long-term savings and benefits greatly outweighed their initial hesitations.” This approach not only validates the customer's feelings but also provides social proof to ease their concerns.

When you provide proof sources and testimonials that support your statements you have a winning combination!

Create a Sense of Urgency

Instilling a sense of urgency can be an effective tool for overcoming price objections. When customers feel that an offer is time-sensitive, they are often more inclined to make a decision. Use strategies such as limited-time discounts or emphasizing potential losses from delaying a purchase.

However, it is important that any urgency created is genuine. Customers can often spot insincerity, which will damage trust. For example, "This discount is only available until the end of the month" feels more honest than "Act now or you'll miss out."

Follow Up with Value-Added Content

After you’ve addressed a price objection, it’s vital to maintain the conversation. Following up with value-added content reinforces the benefits of your product or service. Send relevant articles, case studies, or detailed information that caters to their specific concerns.

For instance, if you had a conversation about operational savings, send a case study about how another company achieved those results using your offering. By providing ongoing value, you position yourself as a reliable resource and keep your solution top-of-mind, paving the way for future sales opportunities.

Recap of Key Strategies

Overcoming price objections is a crucial competency for sales professionals. By addressing price questions at the right time, understanding customer perspectives, communicating value, and employing a variety of strategies, you can navigate these challenges more effectively. Active listening, empathy, and clear reasons for your offering's worth are key components.

With practice and persistence, you can turn price objections into chances for deeper engagement and successful sales. Implementing these best practices can enhance your approach and lead to better outcomes for your business.