Leading with price undermines differentiation—here's why the business case should always come before the quote.
To paraphrase Hamlet, "To quote or not to quote, that is the question ..."
The customer, of course, wants to know the price on the first call, followed up with a quote. Too many salespeople believe that the customer is truly trying to qualify them based on the price. The practical reality, though, is just the opposite — the customer wants to know the price to disqualify you.
But don’t the customer and the vendor need to qualify price for each other? The short answer is yes, but not on the first call.
Assuming that you are not the low priced vendor, revealing price without adequate context does not allow you to properly differentiate you from the competition.
Even if the customer insists on hearing the price, you must resist; instead, merely explain that there are many parameters that factor into the price, so divulging price without understanding those parameters is likely to provide the wrong price. After all, nobody wants an inaccurate price quote.
The customer wants to pay the lowest possible price, but you want to show differentiated value. Imagine: if you told customers that your loaf of bread cost $50 on the first call, no one would buy; however, if given the chance to explain that your bread has special nutrients that help the customer live until the age of 200, the $50 would now feel like a bargain, given the differentiated value.
That differentiated value is determined by identifying the unique capabilities of the software and that those unique capabilities have specific value to the customer.
This brings us to the key question, “When should we deliver a price quote?” The answer is simple — deliver the price quote ONLY in conjunction with the business case that leverages our unique capabilities. This approach prevents competitors from “me too-ing” our proposal and significantly improves our win rate by tying measurable business value to capabilities only we can deliver.
Negotiating the business case/price quote through our product lens ensures that we have our best chance of winning. If your sales team lacks the discipline to only quote price with value and would like to convert a much higher percentage of quotes into orders, log into Compass at www.moicpartners.com for guidance.
