Full Version: A Simple Sales Strategy
From: Engravin' Dave (DATAKES) [#1]
17 Feb 2006
To: ALL
A Simple Sales Strategy: What To Say When Asked For A Discount
Has anyone ever said to you, "Your price is too high and I'd like a discount." In this article I outline two approaches for responding to this comment. One of the approaches even has the potential for you to make a bigger sale than you originally anticipated. Curious?
First, giving discounts in the right way may well be the most appropriate thing to do. Conversely, giving a discount in the wrong way can not only lose you a sale but could lose you all possible future sales from a potential client. Read on to see what I mean.
Just suppose you say "yes" and immediately give a discount. What do you think this potential client now thinks?:
* You seem desperate for the sale. * I wonder how far you will lower your price. Mmmm, maybe I should ask for an even bigger discount than I originally planned. * The price you originally offered was not the real price. Are you trying to trick me? Can I really trust you? * You don't set a very high value on your own services if you are prepared to discount so quickly. * You agree your price is too high. This is a problem. * Next time I come to buy anything from you, I will ask for a discount again.
The problem with just giving a discount by itself is that you have given something away and have asked for absolutely nothing in return. You've just created a win/lose situation. The potential client has "won" a discount amount and you have "lost" it. Also, just because you've agreed to a discount doesn't mean you'll get the sale, in fact, quite the opposite. You may have damaged your credibility to the extent this person no longer trusts you or wants to do business with you.
Just suppose now that instead of giving the discount you ask them, "Why do you want a discount?" The response will help you understand what is behind the request. Then, depending on how they respond, you could use one of two approaches.
Approach One
This approach is useful if money really is an issue. Instead of giving a discount, you lower the price by taking out something of value. This is a win/win choice. They get the lower price and you still maintain your price for a certain value bundle. You could say, for example, "If price is more of an issue for you, then I suggest that we take out X product/service." (Suggest taking something out of high-perceived value). The person needs to see that in order to get the discount they have to give up some of the value from your offer. Alternatively you could ask them for suggestions for what they'd like to take out. Or maybe offer a couple of suggestions. Your potential clients need to understand that there is a price for reducing the price!
Approach Two
You agree to give a discount provided they give you something in return. In exchange for a discount you ask them to give you something which is important or of value to you. That's another win/win choice. For example, suppose you offer consulting at $200 an hour, and someone asks for a discount. You could say, "I am prepared to reduce my rate from $200 to $180 an hour if you agree to an initial 100 hours of consulting." The client will receive the discount and you have received a commitment for 100 hours. Another example is giving a discount based on the client buying from you by a certain date, which is an important date for you (e.g. tax year end). The important thing is to ensure that whatever you do, it is a win/win situation and that the person is perfectly clear as to why you are prepared to give the discount.
I was once involved in a very large sale worth several million dollars. As usual, I was asked for a sizeable discount. I agreed to the discount provided the client made a commitment to purchase some other services at the same time (which they needed). As a result of being asked for a discount and the way I packaged my response, I ended up with a much bigger sale, double in fact!
I hope you're starting to see that when people ask for a discount, it creates a great opportunity for you.
(c) Tessa Stowe, Sales Conversation, 2005 You are welcome to "reprint" this article online as long as it remains complete and unaltered (including the "about the author" info at the end).
Tessa Stowe helps Coaches and Consultants stop struggling to sell, and instead attract clients like magic! Her FREE e-course tells you how: "Attract More Clients Naturally: 10 Simple Strategies That Work ... Even If You Hate Selling!" Sign up now at http://www.attractmoreclientsnaturally.com
From: JHayes55 [#2]
17 Feb 2006
To: Engravin' Dave (DATAKES) [#1] 17 Feb 2006
Excellent truly excellent!! One of the biggest keys to our success as business owner is not how good our product is (although it is very important) but how well we interact with our client.
We could have the best show room and the best quality product ever offered but if we fail to do a good job of meeting the wants and needs of our customer we will loose.
Good job David. I have already signed up.
From: Birdman (TBIRD1957) [#3]
20 Feb 2006
To: ALL
A few years ago my wife was waiting on a customer.
The customter want to purcahase a 3 line custom stamp. Our price was $9.50. The customer told her that our competitor sells the same stamp for $9.00, would we meet the price. Being we know exactly what our competition sells there stamp for ($9.95) she told him no. So he left and I guess he went downtown, haven't seen him again. I feel we didn't miss anything. True it's was only .50, but we have a price list and we stay with it. I feel that it isn't fair to all the customers that pay regular price.
Anyway, the customer had to drive all the way down town and pay for a parking meter (twice). He really didn't save anything.
From: UncleSteve [#4]
20 Feb 2006
To: Birdman (TBIRD1957) [#3] 20 Feb 2006
I believe you were correct to stick to your price list. If .50 would make the difference, the customer wasn't "real"....
From: Johnny Orange (LIFETIME) [#5]
21 Feb 2006
To: Engravin' Dave (DATAKES) [#1] 22 Feb 2006
Hi Mo,
An interesting article and some good points. Well Done.
I have a strategy in my business that i don't give discounts on a trophy order rather I donate a trophy pending the value of the order put before me.
When you engrave the trophy you put on it (Donated by your Company name etc.etc). That trophy then goes into the houshold with your company name on. It is therefore in the eyes of all who visit.
You cannot put your name on money (via discounting) so why not put your name on your product.
The customer walks out and believes your great guy as you have recognised his or her's sporting club etc.
From: Cindy (CINDYM) [#6]
22 Feb 2006
To: Engravin' Dave (DATAKES) [#1] 22 Feb 2006
I am copying this article and giving a copy to all my employees to read. I feel the way it was written was clear & concise enough to get a simple point across - don't be afraid to say no to a simple discount request, but give options & alternatives so you both come out winners.
We also don't match pricing, or come down on our pricing, but we do trade services if it benefits us, or it is a cause I believe is worthy. And we don't donate cash, only product. When I really feel I win is if I can get my business name out there in the public, not just once, but repeatedly. So I don't mind sponsoring things that use radio advertising and will use our name in the promotions, and then we also end up on promotional banners & everything that happens with that event.
I am still working off a trade with a radio station for an event they sponsored. In exchange for product, I have had two years of radio advertising - and I get to pick the times the ad runs and I can change it, drop the ad for a while, and do pretty much anything I choose with it. I give them the topic, and they write the ad. They run it by me, make any changes I want, and presto/chango - I have a professional radio ad to promote our wedding dept during the wedding show! Or whatever I want it to be.
Thanks for sharing this article with us - I wholeheartedly agree with the author.
Cindy M
From: JHayes55 [#7]
26 Feb 2006
To: Cindy (CINDYM) [#6] 27 Feb 2006
From: Cindy (CINDYM) [#8]
27 Feb 2006
To: JHayes55 [#7] 27 Feb 2006
Thanks for asking. Surgery was this last Friday, 2/24, and it turned out one of the arteries was completely blocked, so they put in two stents, and the other two arteries had some little blockage, but nothing that needed more surgery. There was some residual heart damage, and he is on about a 100 pills now for various heart related stuff, but he is home and doing much better, although very weak. Now for the recovery, thank goodness. At least we know now what all was going on, and it's fixed.
Hope you all have a great time in Vegas. I'll be there next year. Don't have too much fun at The Beach, although I know you will. That's what I'll miss the most!
Cindy M
From: Stunt Engraver (DGL) [#9]
27 Feb 2006
To: Cindy (CINDYM) [#8] 27 Feb 2006
Happy to hear your husband is on the mend.
I'll make sure the people at the Beach Party don't have any fun.
We'll save that for next year. :-)
From: JHayes55 [#10]
27 Feb 2006
To: Cindy (CINDYM) [#8] 27 Feb 2006
From: Cindy (CINDYM) [#11]
27 Feb 2006
To: JHayes55 [#10] 27 Feb 2006
From: JHayes55 [#12]
27 Feb 2006
To: Cindy (CINDYM) [#11] 28 Feb 2006