Every salesperson, regardless of company and industry, has to deal with price. And, where there’s price there will most likely be … price objections.
This can happen at any time during the sales process. At some point the prospect is going to ask the inevitable: “How much does it cost?” I’m sure we can all agree the least effective course of action you can take as a salesperson is to dive right in and answer the question. Rattling off figures, options, and discounts like no tomorrow is not a recipe for success. That’s called "dropping your pants." Don’t drop your pants.
There can be a number of reasons your prospect has asked “How much does it cost?” While the question might seem straightforward, it could belie any number of motivations. It’s your job to figure out what those motivations are.
Taking the question at face value and simply answering it is like jumping from Point A all the way to Point G. While that might feel expedient, you need to understand points B, C, D, E, and F first or risk torpedoing your deal. What you really need to uncover is the reason the buyer is asking about price in the first place. That means answering their question with a question.
If only it was that simple. Talking about money can be a tricky thing. If the prospect asks you “How much does it cost?” and you respond with something like “How much do you think it costs?” or “Why do you want to know the price?” all you’re doing is irritating the prospect. Let’s not forget that your prospect has plenty of avenues to research price. The odds are they already have a rough idea of the cost of your offering.
In my opinion, the key to dealing with a price objection is a response that sets context then asks a question.
Here’s what I mean. Before you ask a question to clarify what your prospect really means by “How much does it cost?” you need to add some context. Let’s look at three different questions that incorporate context to defuse this situation.
Here’s the first:
“That’s an important question. Before I get too deep into our pricing structure, how much research have you done on what a typical investment is for a product/service like this?”
That’s a fair question, and it helps you get a clear picture of how much knowledge your prospect possesses regarding what the typical costs are for what you’re selling. That puts you in a strong position to respond effectively without having to start throwing numbers around. A question like this keeps your pants on.
Notice the context that comes before the actual question. The brass-tacks question we’re asking here is “Do you already know what something like this should cost?”
While you can come right out and ask that, you risk coming across like an a**hole. For some people that approach really works. I call them charismatic sellers. Those that succeed this way are actually pretty rare. Odds are that’s not you. And, that’s okay. No one likes an a**hole -- especially your customers.
Here’s a second way to handle “How much does it cost?”
“Great question; in many ways, cost is relative. I’d like get some more insight from you if I could. Can you share with me how much experience you have buying a product or service like this?”
If they answer “none,” you now have an opportunity to provide insights and advice on the decision which can help establish trust without immediately putting numbers on the table.
If they answer “some” you have the opportunity to ask a follow up question on the past experience they had and what they learned from it. If they answer “a lot” you can recognize that experience and start to explore how they acquired it and how it informs their purchase process. Regardless of the answer, you have a degree of control before you start quoting figures.
In advance of the third question, I want to make a point about tone. The way you ask these questions has a direct effect on how well they will work. Word choice and voice tone are key. You want to be precise in your phrasing and neutral in your voice tone. It is also important to avoid weak language which will undermine your credibility.
This one has to do with ROI. It applies more to B2B sales, although the question could be used in big-ticket B2C too. When your prospect asks about price, there is a high likelihood they are thinking through their value equation. Your prospects are asking themselves “What am I going to gain in return for the money I will spend if I buy this product or service?”
If someone asks “How much does it cost?” and you decide to go down the ROI road as a way to defuse the situation you might be tempted to ask, “What kind of ROI do you need to see from this investment?” Depending on the quality of the relationship you have with the prospect and the level of trust you‘ve developed, that question might be a bit blunt without some context.
I would consider asking something like this:
“Cost is certainly a key consideration in an investment like this. The other consideration is the return you get. What kind of return do you typically look for when you buy a product/service like this?”
You’re either going to get an “I don’t know,” “I’m not sure,” or “I expect to get X.” Regardless of the answer, you’ve retained control of the conversation and each one of those responses provides the opportunity to ask follow up questions or provide valuable insights to help the prospect make a good decision. All of which helps you to not respond too hastily with pricing information. It’s all about keeping your pants on, people.
There are many different perspectives on how to handle price and price objections, and I’m sure there are plenty of sales professionals that will disagree with the approach I’ve outlined above. That’s perfectly fine. That’s what makes the sales profession so interesting. While there is considerably more science baked into today’s sales processes, there is still quite a bit of art to be really good at it.
I have seen the three approaches above work very effectively when delivered artfully. Give them a try. Let me know if they worked for you. And, if you’ve got other successful approaches for handing price and price objections, share them in the comments below.