Back to Basics - Pricing

Hey, Scott from The Sales Mastermind here. Today’s edition only takes 4 minutes.

Getting pricing is right fraught with danger:

• Too high and you'll scare everyone to your competitors.
• Too low and the business might not survive the winter.

Even when you price correctly, presenting the pricing can take a deal at full margin to no profit due to heavy discounting.

Buying a property to live in

I have learned why people can't stand real estate agents.

My wife and I are shopping for our first home. We have a budget. Let's say it's $1,000,000.

Searching the property apps for that budget (and other criteria) presents a map of options. Many list the price. Others have "Contact Agent."

For us, there is no point looking at a property listed for hundreds of thousands more than we can afford. Yet when we ask agents for a price guide, this is a typical response (actual screenshot):

So we go to the inspection. Look through the property. Ask the agent: "What is the price guide?" In person, they will always give you a number.

Often a number far above our budget.

That inspection was a complete waste of our time.

For the agent, it is a net positive. Either we are genuine buyers, or they pad their number of "buyers" at inspection.

Relating this to B2B selling

As a seller, B2B selling is entirely different from buying a home. For too many inexperienced buyers, they're both just a purchase; you're still just a salesperson.

The big difference is that a property buyer knows what they are buying. And even the things they can't see, a building inspector will find when reviewing the structure.

Ultimately, a property is a known outcome in a highly understood market.

Whereas with B2B sales, no matter how many:

• Conversations
• Case studies
• Testimonials
• References

The buyer is still buying on a leap of faith. Ultimately, they have to trust what the seller says.

One of the easiest ways to lose this trust is when presenting pricing.

When to present pricing

Proactively bring up pricing as early as possible.

It is okay to disqualify if your price is $10,000 and their willingness to pay is $100. No amount of deal-making will square that circle. Disqualify early and move on.

Talk track for Early Pricing:

Seller: "Before we go any further, Mrs. Prospect, I assume pricing will be a factor in the discussion. Are you okay with us covering it, at a very high level, today?"
Buyer: "Yes"
Seller: "Great. For what we've been discussing, similar businesses paid between $10,000 and $8,000, give or take. Is that out of the realm of possibility?"

The key beats in the above are:

• Get permission to discuss at a high level. Today is not about detail, and you won't negotiate now.
• Give a range based on previous experience - even if you have an exact number, give it as a range because a buying journey should start a bit murky and clarify over time. Pricing is merely part of this game.
• Start with the LARGER number. That's the only number the buyer hears.
• End with an emotive question where the ideal answer from the buyer is "no."
• Move on. Don't get bogged down in detail, negotiation, or anything other than answering the question, "If this were the price, could there be a chance you can pay?"
  

What about the final proposal

The most unforgivable mistake when presenting final pricing is emailing it.

The final price is one of the most critical parts of any buying journey. It is make or break.

Ideally, structure the presentation as:

1. We're going to solve all these problems
2. This is the current cost of the problem
3. This is the investment to solve them
4. What is the process for approval?

The keys to an excellent final price presentation are:

• Do it in person, by phone, or Zoom.
• Create anchors for your price. $10,000 sounds expensive. When you start by explaining that the problem is costing them $100,000 today, suddenly it isn't expensive.
• The last thing you say is the final number, then STOP TALKING!!! Let it sink in. Let them speak next. Justifying or explaining the price will lead to discounts.
• End by asking for the process, not the sale. Focus on what they can do next and keep the momentum.

BONUS: Higher Power Close

As a bonus, try combining presenting pricing with a two-step closing structure called the "Higher Power Close." It helps you see how bought in your buyer is and what the objections are.

You need at least 10 minutes for this close.

Question 1: "If it were up to you, would you want to start soon or delay, or what are you thinking?"

Realistically, this question has two answers:

1. The buyer is not bought in. You need to sell better. Keep going. Find the pain and solve the deeper pain.
2. The buyer is bought in. Go to question 2

Question 2: "Great, if you were to present this (alternative: this pricing) to your boss or senior leadership, what pushback would they have?"

No matter what they say, push deeper. Ask, "What else?" "Why do you think that will be a pushback?" "How do you recommend we solve that?" "Help me understand how you would answer that for them." etc

At this point, your buyer will give you their real objections. Deal with them one by one.

I have another bonus closing technique but want to share it with the most committed readers. Reply to this email with "Closing Technique" if you want it :)

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