Pricing — Overcoming ObJections
By Jordache Perozzo
"Your price is too high!”
You have heard that one enough, haven’t you? If you haven’t, you’ve never talked to a detail customer. In my business career, I have heard it from many of the customers I have dealt with. But it presents an opportunity. When customers start talking about price, it really means they want to purchase the service. Why else would they talk to you about the price?
There are really only two questions a customer wants answered to purchase your detail service: “What’s it going to do for me?” and “How much does it cost?”
Customers only need to ask about the price if they like the answer to the first question. This is as true for a business owner as it is for the retail customer. If they don’t like the service, then price doesn’t matter.
Would you buy a tractor just because it was cheap? Of course not. So when the customer says the price is too high, you should welcome the objection; it means you’ve almost made the sale.
So how do you manage the price objection? The first thing to do is to assume the customer doesn’t really mean it.
Most customers use the price objection automatically before they agree to purchase anything. Some people think it’s a genetic trait, but really it’s because it gets them a lower price most of the time. That’s what buyers do. Since they don’t lose anything by asking, they’d be foolish not to. So always assume that the buyers are just objecting to the price because they think they have to.
Your job, on the other hand, is to ignore it. That’s right, just skip right by it. Acknowledge the statement the customer makes and get on with your sales pitch. Try a reply like this: “I can see how you might feel that way Mr. Customer. Now, the main thing our detail service will do for you is...” and go right back into your presentation of the benefits of the service you believe the vehicle needs.
You can answer the price objection later — but you’ll only have to answer it if the customer brings it up again, and that might not happen.
If you hear the price objection again, you can figure the customer is serious about it and has some reservations about the value received in return for the price paid. But don’t start talking about price yet — listen instead. It’s important that you know what type of price objection you’re dealing with before you answer.
There are actually several different kinds of price objections, each requiring a different strategy. Is
the total amount beyond the customer’s means? Is the price of the unit too high compared to the competition or to one the customer paid the last time they had the car detailed? Does the price outweigh the value of the service in the customer’s mind?
You need to know which one you’re dealing with before you can answer. And the only way to know is to listen.
Always Negotiate Past the Objection
If customers say they can’t afford the service you’re suggesting, offer to do less, so they can. For example, rather than a full detail do an interior/exterior and take out
the engine and trunk. Don’t lower the price — offer a lesser service. Or throw in a value-added service such as a fabric protectant.
Sometimes when you offer a lesser service a customer will say, “I want the entire detail, just at a lower price.”
If they do this, it means this wasn’t really a price objection in the first place; it was the beginning of negotiations. So your approach is to build the perceived value of your detail service. There are two factors in the purchase decision — the price and the value — and the relationship between the two leads the customer to purchase.
If this doesn’t get you anywhere, it probably means you’re dealing with a real haggler, so just play the game. Go back and forth making offers and counter-offers until you reach a price that is acceptable to both of you.
Should you not be willing to lower your price, just say so and give the customer two choices: either pay your price for the detail or consider a different service. Be honest and positive at the same time.
Keep one thought in mind with negotiation: never tell the customer “no” without an alternative at the same time. “No, I can’t lower my price, but I can reduce the cost by subtracting some services.” “No, I can’t cut my price, but if you will accept a one-step buff, polish, and wax rather than a three-step process I can meet your price.”
This will keep the price discussion in a positive tone. And it allows you to turn the price objections into an opportunity to close the sale and deepen the relationship with the customer.
Empty Wallet Syndrome
Sometimes a customer is telling you the truth when they say they can’t purchase because they really don’t have the money. Their credit cards are maxed out, and the bank account is empty.
Again: back to the reduction of services to lower the price. Work with the customer. The process is a perfect closing opportunity.
Never ask customers what they can afford as a starting point, because most customers will give you a low-ball figure. Instead, review each service and get the customer to rate them in order of importance. Then, if you can, remove the less important ones — and their cost — until you can reach a price the customer can live with. You should end up with a larger sale than if you let the prospect set the limits in advance.
Many times you can’t eliminate services and dollars. If that is the case, you need to take your current suggested detail “off the table” and come up with another, less expensive one in its place. If you cannot come up with a less expensive alternative on the spot, retreat and start over. Get as much information as you can about what the customer can afford, which were the strongest features they liked about the proposal, and present Plan B.
The last type of price objection deals with unit prices. This will take several forms, such as comparing your prices to your competitors’ or matching the prices you’re proposing to those the customer has paid in the past at another detail shop.
The great thing about selling a creative service like detailing is that you can make sure your detail work is unique, so the customer can’t make comparisons. How can you compare the price of a paint job by Earl Schieb to one by Borris? So eliminate a price comparison by stressing the artistry of your service. There’s no reason to fear a price objection. Instead welcome it. It means the buyer wants to buy from you.
Jordache Perozzo is aftermarket sales manager for Detail Plus Car Appearance Systems Inc. His automotive experience was initially acquired in his father’s detail business and later expanded through a position in Internet marketing and sales
for auto dealerships in the Northwest.
You can contact Jordache at Jordache@detailplus.com.