I know that you have experienced this:
You’re at the end of your presentation, you present your price, and the client is shocked. Deeply shocked!
They’re so shocked, in fact, that their reactions can be anywhere from sad, to confused, to downright furious! They can even be shell-shocked to the point that they don’t even know what to say.
When this happens, they’re not going to buy. You are going to get a load of excuses. You’ve heard these before, right?
Let me think about it.
We’ll call you back when we’re ready to make a decision.
I have to get three bids before I can do anything.
The real reason why you got slammed with objections is because your client wasn’t prepared for the price. The good news is, we can fix that!
I’m going to teach you three techniques that you can use to make sure that your client is prepared for the price.
Technique #1: Explain the Investment Factors
When you’re presenting a large ticket item, it’s important to start price conditioning very early in the call. This technique is used prior to your heat load calculation or your system design work.
There are several good ways to use investment factors, but to keep it simple for this example, I want to limit it to two.
It works by explaining that there are two major factors that are going to affect the price of a system:
- Options that can be controlled by the client, and
- Options that aren’t in anyone’s control.
In this technique, you’re going to pick out some items that will increase or decrease the total cost of a system. Then you’re going to tie this into their system options. You could explain how increasing efficiency increases the price. You could also explain how bigger systems are naturally going to increase the price.
Once you have given the homeowner a series of features and benefits that affect price, you’re then going to relate that to a sliding investment scale. To make this really work well, you could even use a visual representation of this sliding investment scale.
This is a great technique that is very effective at communicating the investment range and choices that a homeowner will have. If you would like to hear some examples in greater detail, make sure you listen to the audio version of today’s blog.
Technique #2: Use the Shock and Awe Statement
The Shock and Awe statement is a tried-and-true classic for any salesperson. It is used to coax out the budget that a homeowner has in mind when they are not willing to freely give it.
Here’s how it works:
- You asked the client to tell you what budget they had in mind for this project.
- They give you some type of reason why they’re not going to tell you.
- You then ask them if they’re willing to invest a very large sum to get the project done. Be specific, say something like “$20,000.”
- You keep your mouth closed and wait for them to talk. They will usually tell you no, they will not spend that much money.
- You then ask them what they’re willing to invest.
- Surprisingly, 90% of the time they’re going to tell you now
This technique works because of human nature. The homeowner will not be expecting the surprise of you being so bold to ask for a large amount. So, it loosens their lips just enough to tell you what budget they actually had in mind.
Once you know this information, then you also know how much value you need to build.
Technique #3: Reference Other Jobs
This is my personal favorite technique. The reason why I love it so much is because it ties in technique number one and two with real examples.
In this technique, you’re simply going to share with the homeowner some real examples of other people that have made very large investments with your company and why they did that. You’ll also share some lower to middle examples of investments made with your company.
The whole point of this technique is to say the following;
When it comes to new systems for your home, Bob and Betty, we have a very large range of options. The great news is you’re going to be able to pick one that’s going to work for you.
This technique is received very well by the homeowners, and it works fantastically! I absolutely love it.
Here’s my closing thought for today: price conditioning is a normal part of the sales process. It helps you and the client make good decisions. It’s also a skill that is quite uncomfortable for many people. My best recommendation to you is to start practicing it today and master it for your own success!
Todd Liles is the CEO of Service Excellence.
Service Roundtable is dedicated to growing your bottom line and helping your business maximize its full potential. These groups of contractors work together to assist you with marketing, sales, business, and so much more. Twice a month, seminars around the United States and Canada are held to network and further assist your business. Visit Service Roundtable.com to see if there are Success Days in your area.