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bigfella

AE (Account Executive)

Tycoon
Big Shot
Executive
+5

How do you overcome price objections/sticker shock?

As a top-performing Inside AE in a highly competitive and volatile industry where price is often the key factor in winning deals, I continuously struggle with presenting our pricing and overcoming the price objection without resorting to heavy discounting. Average sales cycle is about 13 days, we try to build lots of value in the initial call, but our buyers our cheap. Despite being recognized as Rookie of the Year and consistently hitting quota, I want to improve my approach to pricing and avoid giving sticker shock to our prospects while also reducing the need to heavily discount. How can I present our pricing in a way that emphasizes the value we offer and convinces prospects to choose us over our competitors, even when we may not be the cheapest option?

👑 Sales Strategy
☁️ Software Tech
🙅‍♀️ Objections
12

18 comments

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CadenceCombat
Tycoon
14
Account Executive
I think it’s important to recognize the difference between a pricing objection and sticker shock…

Pricing objections can be read as a buying sign from an educated buyer. If you’ve done a good job controlling the sales process, a pricing objection should only really come after you’ve established your solution is a good fit, it’s just about ironing out the numbers.

Sticker shock, on the other hand, is going to come from an uneducated buyer that has no concept of what the average market value looks like for solutions of your kind.

Pricing objections can typically be overcome. Sticker shock should move your prospect closer to disqualification.

What you’re going through is because you have a short sales cycle and it’s why I find transactional sales boring. The window you have to build value, share your expertise and position yourself as a trusted advisor is slim, so if you don’t have a lot of competitive advantages you can break down when discussing price, then prospects will rightfully beat you over the head about it.
Gasty
Notable Contributor
5
War Room Community Manager
One of the best responses I've read in the War Room this week. 👏👏 @CadenceCombat
RandyLahey
Politicker
3
Account Manager
This is exactly it. Nice work Cadence.
Sunbunny31
Politicker
2
Sr Sales Executive 🐰
This is absolutely solid. Qualifying out is as important as qualifying in.
CuriousFox
WR Officer
3
🦊
🧿🦡
TennisandSales
Politicker
6
Head Of Sales
for me i think this really comes down to what makes you different than your competitors. THAT is why thy will choose you even if you are more expensive.

when it comes to dealing with the objection, how are you presenting the cost?

when I mention price ill say "so now that you are seeing those numbers for the first time what are you feeling?"

then let them respond.

"Totally get it, its alot of money. Does it make you immediately think of my competitors?" (you need to say this in the right tone.)

Im really helping them process their thoughts on the call.

DONT justify right away. let them process, THEN reconfirm why they are interested.
SoccerandSales
Big Shot
5
Account Executive
I struggle with the last bit about not being the cheapest option. Setting up the value that you bring compared to the value that a cheaper solution is going to bring is going to be the biggest piece. Easier said than done, but by mastering that one piece, you will find yourself having to discount less.
Filth
Politicker
4
Live Filthy or Die Clean
First thought is - can you make the pricing come through later as they are using the software so the upfront doesn't hurt as much? Also, and I'm sure you pound this during the proposal phase but getting them to realize how much their current process is costing them in time, effort, and emotional stress that your product will eliminate for the low low cost of w/e compared to the stress of bad process.

It's tough, especially in a fast cycle and dealing with cheapos. It's always the smallest prospects that make the most noise, even after signing.
oldcloser
Arsonist
3
💀
Cliche as it sounds, you must sell value. What it solves and how it helps leads. The more you solve the more they'll consider paying. If you have the option to sell payment, lead with it. Old tactic but still extremely effective. Nobody buys a $60k car. They buy it at $649/mo with the maintenance plan included. And if you're the Mercedes while the Toyota is the same price, highlight those differences (no offense, Toyota drivers).
Maximas
Tycoon
0
Senior Sales Executive
Solid take closer,strongly agree.
HVACexpert
Politicker
3
sales engineer
Just because the price is less doesn’t mean it costs less. Does your product payback quicker? Is it easier to implement and train? Better warranty? Is your ROI better? Delivery schedule faster? Lots of ways to discuss value.
Diablo
Politicker
2
Sr. AE
Why are you heavy discounting? Is it something you are doing because that’s the budget your client spoke to you about or it’s to win the deal?

I try to get into the weed of understanding the competitors they are evaluating that tells me the price range they are looking at. Once I know that’s when the value creation starts of why is vs cheapos and affordability test. This gives both of us negotiating power once they are selected us as the vendor of choice.
Pachacuti
Politicker
2
They call me Daddy, Sales Daddy
13 day sales cycle?! Wow.

Just have confidence in your pricing and your approach. That’s about it. Drop names of other buyers helps too.
Justatitle
Big Shot
2
Account Executive
The only way I have seen sticker shock go well is to have an open discussion about what their expectations were and why there is such a discrepancy. Are they comparing apples to apples? Is the sticker shock because they are cheap and react like that to everything?
CPTAmerica
Opinionated
2
President/CRO
I’m guessing you’re early-ish in your sales career based on the rookie of the year award. Congrats on your success thus far! Sounds like you’re on the perfect career path.

Understand that our own mental outlook on money, pricing, budget plays a much bigger role on how we sell than most realize. If you go into a call “knowing” you’re too expensive or the prospect is too cheap you create a self fulfilling situation. It’s not overt, more sub conscious, but 100% impacts how you operate.

Recognize early on that you will not sign everyone. The easiest way for a prospect to say no is to blame budget, finances, etc. that’s fine, don’t carry that to your next call. Have confidence in your product and pricing and keep moving forward.
coletrain
Politicker
1
Account Executive
I tend to go with making price an emphasis as late in the process as possible. Yes, you want to ensure it is budgeted but selling the value comes first so pricing negotiations are less about "do we really need this" and more on "how can we make this more cost effective"
Kosta_Konfucius
Politicker
1
Sales Rep
What makes your different than competitors? Hard on it the entire team so they understand why yours is a premium.

Also for competitive deals, understand their budget quicker so you know if you even have a shot vs spending weeks on a deal
Sunbunny31
Politicker
1
Sr Sales Executive 🐰
Some excellent advice here already. I'd just add that you need to know what differentiates your solution from the competition, and align those differentiators with your customer's business issues and problems so that your solution is viewed as the best (or only) way to address their needs. Then it won't matter if your solution is more expensive, because you will have framed it in a way that it's the only one that can resolve problems a, b, c. Buyers want to solve problems, not purchase an app. Solve their problem.

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