Archive for August, 2014

Why Your Best Price can be Your Worst Strategy

If you are like many small business operators you’ll be working hard to encourage prospective customers to call you / your business about your products and services.

Your past sales efforts, advertising, networking, branding, referrals, product research, product enhancements, training, and more are in play just to get them to call.

So given the considerable efforts behind getting those incoming enquiries, are you or your team making a fundamental error when they do roll in? See if you can spot it here.

(Telephone rings) – “Thank you for calling ABC Company. This is Sam”

Hi Sam. Do you have any blue 35 mm widgets in stock?”

“I’ll just check for you” (Typing, typing) “Yes, we have 4 in stock”

“Excellent. Can you give me a price please?”

“Certainly. They are $110 each”

“Great – Thanks for that.”

“You’re welcome. Is there anything else I can help you with?”

“No. That’s fine thanks. Bye”

Kid on a phone

“Bye”

So what was so wrong with that? Was the customer service person (Sam) friendly? Sure. Very much so

Was the callers enquiry dealt with promptly..? Yep!

Did the caller get answers to exactlywhat they asked for? You bet…

…And there-in lay the problem!

Consider the person making the call. What are they likely to have in front of them? A pen, notepad, phonebook or an online directory? And what are they doing? They’re calling you and your competitors to get prices, so they are of course making note of…. yep – PRICES!

And if price is all they discuss or focus on with each supplier, what will they inevitably make their decision based on…? Correct!

No matter how warm and friendly you or your team sound on the phone, if the crux of the discussion is ‘how much is it?‘, you will rarely win the caller’s attention or their business if another supplier has a lower price.

Disagree?! When you ring somewhere for prices, isn’t that what you are looking for? The place with the cheapest one? And if price is all you have to compare, don’t you just select the cheapest…?

The solution to overcome this costly mistake is simple…. Talk about more than price!

And the easiest way to achieve this is to ask great questions. And – great questions are not those that you have to ask.

Consider all those questions that would be essential for you to be able to provide a quote to a prospective customer. Example – If I were a fencing supplier, I would need to ask questions around Quantity – Quality – Colour – Size – Time Frames – Material preferences – Etc. All logical and necessary things I would need to ask to enable me to provide some sort of price.
My question to you is… What are you asking that your competitors most likely are notasking?
Now without being able to give examples for every type of business, here are some questions for that fencing scenario that competitors may well not be asking.
What if I were the only fencing supplier to ask – “Do you have any outdoor pets?” “Do you have younger children?” “Do you or your neighbours entertain close to the fence line?” “What types of large items do you regularly need to get from the front yard to the back or vice-versa?” And of course the answers to these would determine the need to ask deeper, further clarifying questions.
Now whether my examples are good examples or not (I’m clearly not a fencing supplier)… the point is – Ask questions that unearth how the potential customer will use / benefit from / be at risk from / may not have thought about etc. when it comes to their potential purchase.
In short – Ask questions that get into and focus on Their World – Not Yours

When you do this well enough and consistently enough, you will regularly find that the quote you end up providing is for a solution that your competitors didn’t even have the caller thinking about… And in those cases – how can these customers compare you to the competition on price? Your solution (and the price) would be unique!

You will know that you have asked an outstanding question when their response is… “Gee, I didn’t think of that… What do you recommend?”!
Surely being seen as a trusted adviser is a better (and more profitable) point of difference than being the cheapest supplier?!

Yours in good times and strong profits

Cheers!

Jeff Austin
jeff@actualtoideal.com.au

Jeff Austin - Business Coach Bunbury