If We Were The Lowest Price, You Would Be A Trained Monkey

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For the majority of my career, I ran sales teams. I was constantly amused and perplexed by the statement that most, if not all, sales managers have heard over and over again … “I lost the deal because our price is too high!”.

I can only speak for myself but, about the only time that I buy an item based on price alone is if I do not perceive that there is any value associated with paying more. Canned corn comes to mind. I buy store brands. So what do I tell these salespeople?

“If we were the lowest price, I wouldn’t need you. All I would need is a trained monkey to take the orders.”

And, if you could process the paperwork correctly, that would make you a highly trained monkey. Seriously, what are salespeople good for if they can’t properly justify the price we are asking for our product or service? They expect us to be the lowest price and still pay them the highest commissions? Don’t answer that (smile). Here is another one of my favorites …

“There is no honor in being low bid”

Why? See trained monkey. Conversely, there is great honor in being high bid. You have demonstrated that you have a superior product/service and that it presents a better value than that which was offered by your competitors. And regarding your competitors, they have been stunned! They are forced to go back to the barn with the full knowledge that they could not even make the sale based on being the lowest price. How demoralizing is that? Things that make me (smile).

How do you avoid the “low bid trap”? There are probably several thousand good books on this but, here are a few key points. We are going to assume that your product or service is competitively priced for what you are offering.

  • Hire salespeople who demonstrate good listening and questioning skills. I’m not so sure that those can be taught.
  • Emphasize to your people the importance of creating relationships with their clients and not just orders!
  • Train your salespeople in the ways that your offering provides excellent value to your customers.
  • Work with your salespeople in the best ways to demonstrate this value. This is an investment, not an expense.
  • Support them in their efforts and constantly re-train and reinforce these principles.
Studies have continuously shown that very few people base their purchasing decisions based on price alone. In fact, price is generally not even one of their top considerations. When was the last time you regretted paying more for a higher quality item? I can’t remember one. The old axiom that the “bitter taste of poor quality lingers on long after the sweet taste of low price has disappeared” comes to mind. I like to think of these things in terms of what I call the “Painometer”.
I’m not smart enough to create pretty graphs so we’ll see if this makes sense.

The most painful part of any buying experience is making the actual decision to go ahead with it. Since this is the most painful part, I often point that out to customers and suggest that I am here to “put them out of their misery” by accepting their order (smile). But, that’s true.

  • For purposes of our graph, writing the check scores highest on the Painometer. The bigger the check, the higher the level of pain.
  • Something interesting happens at this point. Once we have written the check, the pain immediately goes away. The decision-making and the check writing are behind us. At this point, regardless of what we paid, we are experiencing little to no pain as we prepare to enjoy the benefits of our investment. Feels good.
  • Now comes the fun part. If I bought a crappy product because it was the lowest price, and especially if I will be living with that decision over an extended period of time …. watch the Painometer climb year after year after year.
  • On the other hand, I bought the better product based on value and quality. My pain disappeared the minute I wrote that check and it has stayed that way year after year after year.
Thanks for visiting!

Craig

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Author: Craig M. Jamieson

Craig M. Jamieson is a lifelong B2B salesperson, manager, owner, and a networking enthusiast. Adaptive Business Services provides solutions related to the sales professional including Boise’s best B2B leads groups, NetWorks! Boise Valley. We are a Nimble SCRM and a HootSuite Solution Partner and a Value Added Associate for TTI Performance Systems. Craig also conducts training and workshops primarily in social selling.