The Art of Being Expensive
90’s supermodel Linda Evangelista famously proclaimed, “I don’t get out of bed for less than $10,000”.
Now THAT’S how you manage client expectations!
Linda’s very simple statement conveys several things at once;
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I’m expensive
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I’m very good
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You need me more than I need you
(If only your sales team could do this, huh?)
Why most sales teams don’t know how to talk price
In our experience, most healthcare and technology sales teams don’t know how or when to deal with price. Some salespeople avoid the topic until the last possible moment. Others reluctantly talk about price when pressed by a client but seem embarrassed about it – moving as quickly as possible off the topic as if the subject itself is a hot potato. In neither case is there a plan or the confidence to discuss it.
Our advice on price is simple – “Own It”.
The more “premium-priced” your solutions are, the more important this becomes. Perceived power is actual power. And clients can smell fear. A little swagger works.
If your sales team feel genuinely confident in the value they create for their clients, this comes across naturally to their prospects.
Perceived power is actual power.
In enterprise sales, best way to manage objections is to plan for them, and pre-empt them with the client. Price is simply one potential objection. Don’t wait to be hit – talk about it at a time of your choosing.
Here are four simple ways to pre-empt price objections:
- Expand your range of Value Propositions. Invest time training your team to understand the full range of potential sources of client value that your solution delivers. Get beyond your product’s technical performance, and move discussions into operational, financial and personal benefits to the key stakeholders.
- Take the front foot – raise the topic of price early (before the client does) – and do it confidently. If you are the most expensive solution in the market, tell them. “You should know up front that we are a premium priced solution. We may even be your most expensive option”. Avoid giving price lists, (you’re selling a solution, not a product) but be comfortable is asked to give budgetary pricing at the top end of what a complete solution is likely to be.
- Monetize client value. Focus discussions on the client problems your solution will fix, and invest time monetizing the multiple sources of value that your solution will deliver across their business (cost savings, efficiencies, labor costs, waste reduction, reduced risk etc.). For example, if your healthcare solution gets patients out of a hospital bed two days earlier than their current solution, explore the cost per day of medical staff, reimbursement, revenue, reputational impacts, Medicare penalties and staff workload.
- When you then make a specific pricing proposal, you can frame it within the context of these savings and other benefits so the return on investment is obvious and price becomes relatively less important. Because you managed the client’s price expectations earlier in the sales cycle, it’s likely that this final price will be lower than they were expecting – hey presto, no sticker shock!