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Overcoming price objections in science and technology sales

Overcoming price objections is something you’ll have to master to succeed in the science and technology marketplace.
Maybe you’ve already put months into a deal and your customer says you’re more expensive than a competitor. Or maybe you’re just trying to get your foot through the door but a customer has seen your list price and won’t give you the time of day.
Either way, you know it’s likely to come up. So why not prepare for it? Here, we discuss why price is often a false objection and how to overcome price objections without resorting to hefty discounts.

 

Reality or fallacy?

 

Sometimes, just sometimes, price can be a real objection. Maybe your customer has recently secured funding and there’s not enough in the budget to meet your price point. Ask yourself: how far down the sales funnel are they?

If your customer is at the bottom of your sales funnel, and you’ve already put in 6 months of work, you probably need to rethink your qualification strategy.

“Deal with the monsters while they’re small”

Like all objections, the best time to deal with a price objection is as soon as possible, when your customer is still at the top of your sales funnel. By tackling any price objections early, you could save yourself and your colleagues days, weeks, or even months of wasted work.

Most of the time, however, price is a false objection. Why? It’s one of the easiest excuses your customers can throw out there to make you go away – especially if you’re one of the more expensive suppliers in the market. Moreover, customers know that pushing back on price is likely to get them a discount.

 

Price as a false objection

 

Your customer raises the price objection. It might look a little like this:

“You’re too expensive”

“Your competitor is cheaper”

“We haven’t budgeted that much”

What we really want to do is move the conversation on and talk about our value, our USPs, and our strengths. But before you launch into what you think is valuable about your product or service, it’s really important to understand what the customer sees as value and check whether price is your customers only objection. It can be as simple as this:

“Is price your only concern?”

This question can help us check whether the price is a real objection and gives your customer a chance to share what’s valuable to them. In turn, understanding what they consider to be of value guides you on how to sell to them. Take this interaction for example:

Customer: “We’ve considered all the products on the market and your instrument is just too expensive compared to the others we’re looking at”.

You: “I understand that price is a concern for you. Do you have any other concerns with our instrument?”

Customer: “Well, I also think that the software interface is too complicated for our students to use. Your competitor has a more intuitive interface.”

You’ve hit a goldmine! Let what your customer values steer the conversation. In the above example, you have plenty of ways to demonstrate that your software is easy-to-use. You can talk about the training and technical support you offer. You could make easy to follow step-by-step cards that can be placed by the instrument.

Always remember that words aren’t good enough at this stage, especially when speaking with science-centric people. Make sure you can demo or show data to back-up your claims.

“Demonstrations can be really powerful. In this instance, it would be a great idea to organise a demonstration and brief your demonstrator to show your customer how an inexperienced user can use the system. If there’s any automation, show them how easy it is to have a ‘walk-up’ system.” 

Pru Layton, Senior Trainer at george james ltd.

 

Price as the only objection

 

I can hear you already: what if price is the only objection? The conversation may go:

Customer: “We’ve considered all the products on the market and your instrument is too expensive compared to the others we’re looking at”.

You: “I understand that price is a concern for you. Do you have any other concerns about our instrument?”

Customer: “No, I think that the price point is just too high.”

There are several ways you can move this conversation on without immediately resorting to offering a discount.

  • Ask more questions. You may ask them who they are comparing you to and what they offer. Ask them to outline what your competitors’ package lacks or if they see any downsides. This line of questioning can lead to understanding what the customer values and help you steer the conversation back to the strengths of your product or service.

  • Offer one of your more cost-effective solutions. Maybe you have a different model with fewer capabilities . This is great for testing the waters. Your customer may raise objections about this model and you again have an opportunity to find out what is valuable to them.

  • Discuss long-term cost effectiveness. Does your product have better longevity than your competitors? Does it use less reagents? Or does it have a reputation for being a robust machine that needs minimal servicing? How much would it affect your customer if the instrument broke down? The most important thing to remember is that you need proof to back up your claims!

“Back when I was in a direct sales environment, selling ion chromatography systems, I knew we were by far the most expensive on the market. But I also knew that our instruments were really robust and could run for decades. Alongside other data, I would show customers a photo of one of our ICP’s operating on a glacier in the Arctic. I would explain to them it had been running there for 30 years – without ever needing a visit from a service engineer. It was an extremely effective form of proof of value.” –

Pru Layton, Senior Trainer at george james ltd.

 

Prepare for price

 

Preparing for the price objection is fundamental – because you know it’s likely to come up. It’s all about understanding what your customer values, so you can redirect your sales conversations to meet their expectations.

So when you prepare for the price objection, make sure you ask yourself:

  • What questions could I ask to uncover what my customer values beyond price?
     
    • Do they have any other concerns about my product or service?
    • Do they have any concerns about a competitor’s package?
  • Does my product or service offer long-term cost-effectiveness?
     
    • Does my instrument have lower reagent requirements?
    • Does my product have built-in longevity or robustness?
    • Is my product less likely to breakdown or need servicing?
    • Do I have proof?

Finally, remember that although discounting has its place in science and technology sales, it should not be used as your number one tool for tackling the price objection. Attractive discounts will not only destroy your margins and lower your product’s perceived value but it can inadvertently re-position your products’ value in the eyes of the customer – and set the starting point for future negotiations at a lower price point.

Objection handling can be tough to start with but with the right toolkit, it simply becomes a natural part of our sales conversations. You may even learn to enjoy objections! However, if you need some help with objections then take a look at our tactical selling skills open program.

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