When a customer tells you they went with your competitor because your price was too high, what do you do? Generally, salespeople drop their chin, kick the dirt, and lose even more pricing confidence.
Most sellers fail to capitalize on the brilliant opportunity that moment presents.
Last week, a client who sells professional services shared with me that they’re facing a lot more competitive pressure in the past couple of months. Recently, they’ve been hearing “no” more, and they’ve been hearing that their “price is too high” more. When I asked them if they’ve seen a drop in their win rate, they didn’t know. (Are they paying more attention to the “no” more or are they truly hearing “no” more? Is this the negativity bias at work?)
If they really are hearing “no” more, what is what’s really going on? Is that truly because of price? (Are their buyers liars?)
Customers indicate price as the reason for choosing a competitor as the easy way out. It’s more expedient and more polite than telling you that you didn’t make a compelling case for your value proposition. “Your price is too high” often means “Your price is too high for the value that you provide.”
Or more accurately: “Your price is too high for the value I perceive that you provide.”
When you hear, “we chose your competitor because of price,” it’s worth digging a little deeper.
Ask questions to uncover:
- If there was a different problem that you didn’t solve for them
- If you left some other boxes unchecked
- If you didn’t connect your solution to their key pain points
- If they didn’t perceive value in what your product or service provides
One question I love for opening this conversation is, “if we could have somehow erased the difference in price between our two proposals, who would you have chosen?”
If the customer still would have chosen your competitor, price was never the problem. You have more digging to do.
If the customer would have chosen you at equalized pricing, ask why. Some questions to consider:
- What about our proposal makes you answer that way? Why would we have been your choice?
- What about our proposed solution was a great fit for you?
- Besides price, what concerns did you have about our proposal? Was there anywhere our proposal missed the mark besides price?
- What could have been different about our proposal that would have led you to choose us as our proposed price?
- Under what circumstances would you have chosen our proposal?
Don’t rubber stamp “price” as the reason for losses; mine for additional insights about gaps in your offering or your ability to communicate its value.
Let us know if you need help arming your team to ask better questions.