This is a question I get asked a lot.

Recently, I was sitting in a room of salespeople discussing ways to grow the business, and one salesperson was adamant the easiest way to grow sales would be to cut prices.

The argument was based on how the prices he was being asked to sell at were at least 20% higher than competitors’ prices, and the only thing his customers were concerned with was a cheap price.

My response to him was with an example I like to use — pizza.



I asked him what type of takeout pizza he preferred.  He said Pizza Hut or Dominos.  I asked him if he ever bought Little Caesar’s’?  He said no, so I asked him his reason.  His response was he didn’t like it and preferred the others better.  I asked him if Little Caesar’s was cheaper and he said yes.

I’ve used that same set of questions many times to drive my point home.

The salesperson could have bought a cheaper pizza, but he chose not to because he liked the others better.  I told the salesperson the way his customers decide what to buy is the same way he decides to buy pizza.

He was willing to not buy the cheapest because of the value he received by buying Pizza Hut or Dominos.   The same applied to his customers. If he as the salesperson isn’t showing enough value, then why should the customer be expected to pay more?

The reason he claimed his prices were too high is simple — the customers didn’t see enough value to warrant paying more.

Now comes the clincher.

Could and would the customers ever be able to see enough value to warrant paying more?  Maybe not.  Let’s go back to the pizza situation.

There are some customers out there who regardless of their options, will only buy Little Caesar’s.   To them it’s not about quality, its about the quantity of food.  (Ok, I confess and put myself in that camp.  I remember many a time when we had a house full of kids who needed to be fed, and to them and to me quality was second to quantity. Guess what? The answer was Little Caesar’s and a lot of it!)

My whole point is too high a price comes down to two things.

One, the customer seeing enough value, and that is the responsibility of the salesperson.

Two, the core needs of the customer.  There are some customer that simply will not see value in a higher price.  Example — me feeding masses of kids occupying my home!

Is my price too high?  No, not if I’m targeting the right customer and am able to demonstrate sufficient value in my selling process.

Copyright 2015, Mark Hunter “The Sales Hunter.” Sales Motivation Blog. Mark Hunter is the author of High-Profit Selling: Win the Sale Without Compromising on Price.

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