You’ve been told that your dream client wants to give you his business, but one of your competitors has come in at a lower price. If you want to win, you will have to do better. But does that mean you have to reduce your price? You have two choices: You can sharpen your pencil or you can sharpen your value creation.
A few points to consider. First, you have to keep in mind that it’s your dream client’s responsibility to get the best deal he can. He has to check. He has to ask you for a lower price or he wouldn’t be doing his job. It would be irresponsible of him not to try.
Second, most of the time, your dream client is willing to invest more to get the results she needs. But she needs your help in justifying the greater investment. The more you can quantify and explain how a greater investment results in greater returns, the more likely you are to keep your pricing intact. But you need to sell it. Keep these points in mind before you cave in on price.
Sharpen your value creation. When you are asked to lower your price, you need to push back by pointing to the value you are creating. Sharpen your argument around value before you sharpen your pencil.
Instead of allowing your dream client to under-invest in the results he needs, remind him that your pricing model was built on getting him the results he needs and point out the risks of under-investing.
Remind your dream client that the reason she hasn’t been able to achieve the results she has sought in the past is because there wasn’t enough value being created. Something needed to change for results to change.
Point your dream client back to the higher cost he will pay if he chooses your competitor based on price. Explain that cost is different from price.
One last thing. As I write this, I am reminded of how many clients I have seen over the years switch providers expecting different results only to be continually disappointed. They believed the big lie that they could produce better results and pay a lower price. Until they didn’t believe it anymore.
You can’t blame your dream client for choosing a lower price if you didn’t do everything in your power to sharpen your message around the value you create. If you don’t help them to defend your price by defending it yourself, you’re going to have to sharpen your pencil instead.
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S. Anthony Iannarino is the managing director of B2B Sales Coach & Consultancy, a boutique sales coaching and consulting company, and an adjunct faculty member at Capital University’s School of Management and Leadership. For more information, go http://thesalesblog.com/s-anthony-iannarino/