Contributed by John Wheaton
If the first question a client or prospective client asks about is related to price, then we know that their values are centered around cost. Most attempts to sell them otherwise will not typically work. To this purchaser, value is based on low price, and the product or service is viewed as a commodity. If the client-buyer is interested in what we’ve got, and we aren’t the low price, they may ask us to justify ourselves. I got this question last week “Why are you double the other price? Can you explain why your price is so high?” (This is a downward spiral by the way. Don’t answer the question to try to validate.)
I provided a polite and professional response, but didn’t answer the question exactly. I indicated what value was being provided and how the fee compared to other service-company fees in our category. My response asked the opposite question back, “Why is their price half of ours. Why are they so cheap? We are both looking at the same project, right?” Then I explained what was being provided and nothing more.
I didn’t hear back from that client yet. And there’s a good chance that I won’t. They will likely purchase the other provider’s services. Because what this client was really SAYING, not asking, was “Hey, you’re too expensive. I can get the same thing for 40% less.”
So why do I say that price is irrelevant? Because we buy based on our values. Price is the consequence, the manifestation. It’s not the issue. Price or cost-based buying says “any of these firms will do, just get me low price.” The problem with this is that the buyer is assuming that they are getting the identical service from any of the choices presented to them.
It’s never really about price. It’s about the buying mindset and values.
Cost-based buyers want low price. Cost leads the conversation.
Value-based buyers want what they perceive to be the best investment and value for the cost of the purchase. Value and investment leads the conversation, price falls out, sometimes negotiated, sometimes as stated.
Identity, connection, or brand-based buyers want to identify with a particular person, enterprise, brand or genre. Being connected to the associated values leads the conversation. Price is what it is; “If you want to be connected with us, the fees associated with that are as defined.”
Price is important, but price is really irrelevant. People already know about what they are willing to pay based on their mindset.
What kind of buyer are we seeking to attract?
What values are we seeking to communicate?
How is that portrayed in our brand?
Are we delivering?
Whatever we choose, we need to stick to it and dive deep. Pick a lane and stay in it. We can’t be all things to all people.
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