What role does price play in making the sale?
Why do contractors struggle with price and objections? It is no secret contractors struggle with price and price objections. One of my clients asked very thoughtfully, why do contractors struggle so much with price and price objections. If it is not pricing that buyers are basing their decision on, what is?
As a sales trainer and marketing consultant, I’m constantly being asked what role price plays in the buying process. If you ask a contractor or estimator what role price plays in the buyer’s decision, they almost always think the price is the overwhelming factor in making purchasing decisions. In my sales consulting practice, I come across studies every ten years or so. These studies completely contradict this belief that price is the deciding factor.
Buyer behavior tells a different story.
In every study I have seen since 1995, price is not what sells. Looking at what role price plays in a sale price has yet to break the top 5 reasons why a buyer chooses who they choose. In recent studies, priced ranked anywhere from 6th to 7th when buyers rank the decision criteria.
What is it if not price?
If it is not pricing that buyers are basing their decision on, what is? In our sales training and sales coaching calls, we constantly look for these attitudes so that we can shed light on the belief system of those we coach and train. What I have seen during my 25 years of sales training and sales consulting has been the same thing. If you think price matters, you make it a barrier. It’s not price. Let’s talk about what it is.
It is the ability of the salesperson
When buyers are asked why they bought what they bought, the answer is “The ability of the salesperson continues to rank as the overriding criteria in the buyer’s perception.”
As a sales and marketing consultant and a lead generation specialist I was fascinated with the following study. A few years ago, HR Chally interviewed 1,000 buyers to determine what was the critical role price actually played in making a buying decision.
1,000 Buyers Interviewed – Answers Please
The buyers interviewed bought more on the skills of the salesperson than price, quality, or service features. Here are the top 4 buyer’s criteria:
- Competence of the salesperson
- Total customer satisfaction
- Total customer solution
- Competitive price (not lowest price)
A salesperson’s ability to ask great questions, demonstrate empathy and demonstrate active listening for competence and likeability come down to whether or not the customer likes you and feels you understand them. Do they feel you take the time to listen to them and really get what they are feeling and what they are trying to express?
Here are the critical skills and attitudes that make a salesperson successful and able to get past the typical price objection with skill and competency.
- Qualifying -Willing to engage in a deliberate process of questioning and listening to determine whether the prospect is a good fit. vs. being too eager to present and give away information.
- Questioning effectiveness– Creating a structured system of effective questions to “diagnose” the situation and determining the prospect’s technical and emotional needs. vs the belief that questions are “intrusive” and that one should not ask too many.
- Bonding and Rapport– Being able to create trust and rapport with prospects quickly. Adjusting one’s own personality style to the style of the prospect in order to create a sense of ease for the prospect vs. not focused on building trust, appears self-centered or self-oriented, and finding it difficult to be genuinely interested in the prospect’s needs or wellbeing
- Active listening – Seeking to understand what the other person is attempting to communicate. Going beyond “hearing” and focusing on the various messages vs. being easily distracted while attempting to listen. Formulating replies in one’s own mind while others are speaking.
- Having a process to follow– Having the patience and attention to detail to follow a step-by-step process. Systematically following well-defined processes vs. impatient, and reluctant to engage in detailed processes or procedures. Generally, attempts to cut corners and “wing it.” Impulsive.
These are the ingredients that make up the competency needed to overcome price objections and going from good to great in sales.
In addition to the above competency’s, there are some crucial attitudes that also work in hand and hand with the skills we just outlined
In addition to the skills, sales coaching, and sales training, there some hard-wired personality traits I have found very helpful in selling success.
Drive- According to Telexes – who has assessed thousands of sales professionals, A combination of a couple of key personality traits matter greatly
- Willingness to take control and the tendency to strive for control of people and situations and to lead more than follow.
- Competitiveness – Tendency to work toward goals and to try to exceed others’ performance.
You can learn more about assessments and how they can help you develop your sales team here:
https://carlswayworks.com/hiring-and-assessments/