Written by Sean McPheat |
I met a salesperson on one of our programmes who was really upset that his company had raised his product’s prices by over 3%, and hadn’t given him an explanation as to why.
It was simply called ‘an inflationary mark-up’, even though inflation is actually running lower than that figure.
His frustration about the situation made me feel sorry for him, as he couldn’t affect the decision.
He had to ‘just live with it’ as he told me.
I sent him some information about pricing, and why it’s important to see your product as adding value to the customer’s business.
In fact, having higher prices should actually make you feel prouder of your products as they send a different message out to the market.
Here, I share some of the ideas below:
Customers will have a different view of your services, your business and you
It’s all about perception.
If the customer sees you with a higher price than the competitors, it will make them curious as to what you’ve got that the competitors haven’t.
They may ask what they can get that they wouldn’t get elsewhere.
It makes you look at your proposals from a different angle
You will have to move away from concentrating on your price and focus instead on how you will be able to solve customers’ problems in a more dynamic way
You’ll lose some of the ‘price-is-the-only-thing’ time-wasters
Believe it or not, some of the customers you may lose aren’t worth your time anyway.
If they’re a price-only buyer now, they will always be one, and that will only hurt long-term margins.
Your higher prices actually mean you’re attracting higher-value customers who understand the meaning of value and appreciate the extra work you do for them
When price is taken off the table, you create a different level of relationship with the client.
It becomes a partnership and allows you to work at a deeper level with them, as price and costs become less important than quality and effectiveness
The better customer base you acquire allows you to build further attractiveness to future prospects
This increases your image in the market place, so you become more attractive to those prospects who want to have great service, guarantees, back-up and so forth, and the increased profitability will allow you to invest in better and more successful processes.
It’s really just a matter of perception.
If you actually believe your products are better than the competition and the value outweighs the price customers pay, it will give you the confidence to approach prospects, proud that you are more expensive than others.
Originally published: 4 April, 2018