“It is unwise to pay too much, but it’s worse to pay too little.
When you pay too much, all you lose is a little money – that is all.
When you pay too little, you sometimes lose everything because the thing you bought was incapable of doing the thing it was bought to do.
The common law of business prohibits paying a little and getting a lot – it can’t be done.
If you deal with the lowest bidder, it is well to add something for the risk you run, and if you do that, you will have enough to pay for something better.”
— John Ruskin, 1819-1900
People always buy on price
People never buy on price! They make a price versus value judgement and if no perceived value in the additional premium is demonstrated, the ‘cheaper’ option wins.
Dominic has to fly to New York from the UK to secure a business contract worth £10m. Dominic has been working on this project for 6 months and is meeting the Chairman, CEO and Finance Director of the prospect organisation. His meeting is at 10am USA time and, due to other commitments, he can’t leave the UK until late afternoon on the previous day.
Recognising Added Value
Does Dominic book an economy seat for his 5 hour flight or a business class seat at more than five times the price? Of course he books a business class seat because the airline sales person has identified (and got agreement to) the value of Dominic being able to rehearse his presentation one last time, re-read through his notes in peace, get some sleep whilst travelling, use the arrivals lounge in New York to shower and change (his prospect is meeting him at arrivals) etc., etc.
Clever questions driving acknowledged needs and wants
Through some cute questioning, the airline sales person also identified that Dominic works on a commission only basis – he’s on 0.5% of the ‘order’. Dominic is prepared to fund the cost of business class travel personally if his company refuses.
We paint the vivid picture above to illustrate the importance that mysalespunch places on correctly defining where the competitive strengths of your product / service lay. Focus on the customer’s business in order to identify issues that need addressing and how your product / service can address them—particularly where you can deliver something superior to the competition. Linked to this, importantly, is recognition of which members of the customer organisation should be involved in the decision-making process together with the key questions that need to be asked to gain agreement to perceived customer value for your solution.