How To Sell Overpriced Services

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  Kasper Retvig06/30/08 Report as spam
  1

  Will it flowt?

  I agree with everything in the post. But I believe that it will only work if the company in question actually delivers superior work and preferably has some references that show it.
  
  If they just deliver the same "crap" that everybody else does then the strategy is short lived. Notice that it only matters what the customers perceive. If the customers perceive that superior value is delivered then fine it will work.
  
  I have worked for companies that claimed that they would deliver superior solutions and therefore were more expensive. But in the end it was more a question of they didn't know what they were doing and therefore needed more development time. That didn't work for very long!
  
  Also if that is the strategy the "askers" company wants to choose I believe he should be compensated for the expensive make over that he needs to have done. Tell your boss your strategy and then let him know that it will only work if he pays for the make over.

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  Geoffrey James, Sales Machine06/30/08 Report as spam
  2

  So true, so true

  I'm assuming, based upon the fact that customers like their work, that there was something that might justify the higher price, and that the extra time involved in development was conducive to higher quality.
  
  If neither of those are true, the company doesn't have a viable business model, in which case the reader should be looking foranother job. The fancy suit will come in handy when he interviews. An MBA with sales experience should be able to find something quickly.

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  dave.stein@...06/30/08 Report as spam
  3

  RE: How To Sell Overpriced Services

  Here are a few more ideas about positioning.
  
  Point #4. Make a very clear distinction between you and ALL your low-priced competitors, as in, "Please think carefully about whether you want to do business with companies like THEM, or a company like US." It works a lot of the time. It really puts you apart and above--positions you as elite.
  
  Another idea: Find out what car your prospect drives, or where they live or where they vacation. If any of those aren't the lowest priced alternative, probe into why they don't always go for the lowest price. Help them to convince themselves that they really aren't after the lowest price all the time, after all. If they drive a Tata auto, and vacation at the airport Motel 6, look for another prospect

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  Geoffrey James, Sales Machine06/30/08 Report as spam
  4

  Great ideas

  Very nice. Thanks!

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  kennethliuwf06/30/08 Report as spam
  5

  RE: How To Sell Overpriced Services

  Our company also have the price problem. Our price is higher than the competitors. As our customers are mainly oversea customers, most of communication are via email or telephone. It seems that "upgrade your appearance" can not help me. What is your advise to me?

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  Geoffrey James, Sales Machine07/01/08 Report as spam
  6

  Sure...

  Do everything on the list except step one.

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  gnewsome06/30/08 Report as spam
  7

  RE: How To Sell Overpriced Services

  I wouldn't leave out the support organization's responsibility to legitimately be the best. Being the best is not by your own assessment but an objective review of your peers. Armani suit and sweet talk might get you a deal - but it won't keep it in the long run - if you do not have legitimate substance behind how you position your org.

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  Geoffrey James, Sales Machine07/01/08 Report as spam
  8

  True, but...

  ...that wasn't the question. He wanted to know how to make sales, not how to build a business. There are all sorts of "luxury" goods that are not one iota better than their less-expensive counterparts. Designer handbags, for example, are made in the exact same factories in China, with the exact same materials, that make are used to make the knockoffs that sell for a tenth as much.
  
  I'm reminded of two age-old selling maxims:
  
  1. "Don't confuse selling with installing"
  2. "There's a sucker born every minute."

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  Aimee33307/01/08 Report as spam
  9

  Love it when you preach to the choir!

  Right on Target Geoffrey. When I worked with a high-end Post house, our prices were insane! But one really great deal was better than 10 tiny accounts! I always said up front, "We are the most expensive in town, because we are the best in town!" My clients appreciated the extra bells and whistles that were added to their projects and had an excellent perception of value!

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  gherdociam07/01/08 Report as spam
  10

  RE: How To Sell Overpriced Services

  gentlemen:
  
  Selling the values is OK, but you cannot hide under a very expensive suit, an offer that does not make sense to buyers.
  
  exclusivity sounds fine, provided there are enough "exclusives" in the webpage business to make it sustainable.
  
  I've not yet met a Procuremet agent or CEO in my 35 years as marketing & sales consultant, who made a purchasing decision of an overpriced product, based on the suit or shoes of a salesman.
  
  The proposal of making a sales approach stating that you are expensive, exclusive for the "rich and famous", might sound very arrogant, and have my doubts as to the wonderful magic this is supposed to create.
  
  We live in a globalized world, where if you can't make sense to your pricing, you are only a click away from being replaced somewhere in your town or the world, by someone who does.
  
  Last, With the milllions of options we have nowadays of webdesign companies around the globe, is there really a need for the Rolls-Royce of webpages? I doubt it.
  
  Conclusion, get a new job, this company sounds as though will not be there long.
  or, get your marketing people to work on a Pricing structure, that makes sense to the companies who are turning you down now.
  Keep a log of rejections vs sales, and compare it to your closest competitors. Then at the right moment present it to your boss, if he does not react, move.
  They say, if you are not part of the solution, you are part of te problem.
  Perhaps, Mr G.James has been too long writing articles and selling books, that has not had the time to be in front of customers in quite a long time. he needs to do that, urgently
  Good luck
  
  Know How Consulting
  Mexico City

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  Geoffrey James, Sales Machine07/01/08 Reported as spam
  11

  My Response

  QUOTE:I've not yet met a Procuremet agent or CEO in my 35 years as marketing & sales consultant, who made a purchasing decision of an overpriced product, based on the suit or shoes of a salesman.
  Hmmm... Really? Try showing up for sales call in flip-flops and a t-shirt and see how many sales you make. And if somebody is convinced of the value of something it is, by definition, no longer overpriced.
  
  QUOTE:With the milllions of options we have nowadays of webdesign companies around the globe, is there really a need for the Rolls-Royce of webpages? I doubt it.
  Your doubts are reasonable, but READ HIS EMAIL carefully. He made at least one sale. That proves that the service is viable, priced as it is. By the way, the funny thing about services is that people like to be well-serviced. Not everyone wants the lowest common denominator.
  
  QUOTE:Conclusion, get a new job, this company sounds as though will not be there long. Or, get your marketing people to work on a Pricing structure, that makes sense to the companies who are turning you down now. Keep a log of rejections vs sales, and compare it to your closest competitors. Then at the right moment present it to your boss, if he does not react, move.
  Good ideas, but that wasn't the question. The question was how to sell something that's overpriced, which many companies do quite successfully, even in the B2B environment. Getting into a margin-murdering price war should always be a last resort.
  
  QUOTE:Perhaps, Mr G.James has been too long writing articles and selling books, that has not had the time to be in front of customers in quite a long time. he needs to do that, urgently.
  I think you've got me confused with somebody else. If I don't sell, my kids don't eat. In any case, my expertise comes from observing what works in a wide range of situations across multiple industries, not my personal shoe leather experience.
  
  All that aside, enjoy the shrinking margins that your "discount until they buy" sales approach is getting you.

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  chrisdesouza07/01/08 Report as spam
  12

  RE: How To Sell Overpriced Services

  Okay, You said it and that's how it plays out. Too many ******** articles and not enough DATA to back it up. The Internet is worse than the most polluted landfill.
  
  Talk, talk and more bull talk. It's so easy.

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  Geoffrey James, Sales Machine07/01/08 Report as spam
  13

  Thanks...

  ...for that extraordinarily DATA-rich comment. We are now enlightened.

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  kenneth.seymens@...07/01/08 Report as spam
  14

  RE: How To Sell Overpriced Services

  Your response to "A reader" is pretty simple. My reaction and commentary will probably be much to her/his chagrin brutally honest. I would like the name of the B-school you attended so I can call the dean and tell him to get ahold of you and get his MBA back. Come on MBAer the advice posted is marketing/sales 101. Get in the game and stop whining... CowGirl/Cowboy up.....`

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  ndlicht107/01/08 Report as spam
  15

  RE: How To Sell Overpriced Services

  Geoffrey- Right on.
  
  Of course you need to dress professionally but its the understanding of where you client "hurts", that your stuff is a blind item to them, and then establishing the value based flow of your sale so it clearly addresses "where they hurt" with a worry free solution.
  
  Selling is an art. Its not imparting, its doing detective work. People do things for their reasons, not yours so understand them and their reasons, rephrasing how you make their isues go away because they selcted your solution and show them how it will do so.
  
  Its not the mechanics of the web construction that you are selling, its what the web does for them and how it assures their desired outcome. Others will sell the construction but you are selling the knowhow re the reason for haveing the page and how to make the page deliver.
  
  Thats what folks pay for if you lead them to understand thats what they really need to buy, not simply the mechanics od a page, the what it will do, how, why, its value, its "selling to their market" ability, its ROI.
  
  Please try that ASAP.
  
  Neil licht, Answers ndlicht@verizon.net

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  skeeter213107/02/08 Report as spam
  16

  Make friends

  I work for a company that has a similar approach. We are a family owned ( 80 million dollar )manufacturing company in a industry composed mainly of publicly traded companies. Return on investment and GPM is often valued differently than shareholder value and annual sales. We are pressured daily by customers for a lower price and from management for increased margin. In my experience Value and service mean very little when competition is high. The determining factor mostly is price. Our business if from repeat customers and consumable goods. developing relationships and being able to have open and frank dialoged can help work thru price issues.

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  Peter Dilger07/03/08 Report as spam
  17

  Look Expensive

  You say spend money on clothes expensive watches haircuts etc
  
  The buyer then says its obvious you are charging too much just look at your watch
  
  The worst sin a sales person can do is look more afluent than the buyer - better car better watch better watch out for buyer jealousy or buyer saying its overpricede

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  Geoffrey James, Sales Machine07/03/08 Report as spam
  18

  Say what?

  Expensive clothes say that the sales rep is successful at selling and the company is compensating well, not that the product is inappropriately priced.

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  Peter Dilger07/06/08 Report as spam
  19

  Expensive suits say what?

  I disagree

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  Geoffrey James, Sales Machine07/07/08 Report as spam
  20

  You're missing the point

  See:
  
  http://blogs.bnet.com/salesmachine/?p=367

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  Peter Dilger07/03/08 Report as spam
  21

  RE: How To Sell Overpriced Services

  This is all about a definition of overpriced
  If you mean high priced but offers value then you must sell the value proposition and many of the contributors have suggested ways to do so ??? because it is higher priced does not mean it isn???t worth the money
  However if overpriced means it is not worth the money ??? then a number of key issues come into play
  If you can???t justify the value proposition (an expensive suit won???t do it) you will lose the majority of sales ??? managing to get at least one sale does not mean anything if you lose all the rest ??? it could have been to a totally uniformed buyer or etc etc
  If you don???t think it is value and you think it is overpriced then in most cases you won???t come across as convincing to the client
  Again if you think it is overpriced then you are not selling but conning ??? no wonder the sales profession is held in low esteem by many - it doesn???t help when you are advised to exaggerate or at worst lie ??? ???that the top quality appearance of your sites is matched by the effort your firm lavishes on the back-end programming, which is where your so-called ???competitors??? skimp??? - If that statement is not true DO NOT LIE if it is then its part of the value proposition ???
  There is a whole new argument about professional sales people not knocking the competition but that would sidetrack from the main points
  So it comes down to - is it a tough sale because its a high priced item???? or is it truly not worth the money? Are you a being con man or a professional sales man?

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  bminor72207/03/08 Report as spam
  22

  RE: How To Sell Overpriced Services

  Good luck to those that take his advice. Objections come from a lack of understanding. Either you don't know the client needs, or they did not fully understand your value. Ask good questions about their needs and make sure you are able to tie your value to each need. If they balk, as where you may have misunderstood their need. Ask them to clarify. If they balk again, ask them to tell you what they are willing to pay for your service. You may be surprised at how close they come. If they are way off, walk away. Say thanks, but we charge a high price because we deliver high value. DON'T SELL ON PRICE FIRST. AND DON'T BAD MOUTH COMPETITION. Stay focused on your value and the client needs!

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  Geoffrey James, Sales Machine07/03/08 Report as spam
  23

  Competition

  I agree about not bad mouthing a specific competitor. That makes you sound small-minded. But bad mouthing common practices in your industry in order to highlight something that you do differently is fair game.

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  Peter Dilger07/03/08 Report as spam
  24

  RE: How To Sell Overpriced Services

  This is all about a definition of overpriced
  
  If you mean high priced but offers value then you must sell the value proposition and many of the contributors have suggested ways to do so. Just because it is higher priced does not mean it isn't worth the money
  
  However if overpriced means it is not worth the money then a number of key issues come into play
  
  If you can't justify the value proposition (an expensive suit won't do it) you will lose the majority of sales. Managing to get at least one sale does not mean anything if you lose all the rest you may have got an order for a number of reasions it from the buyer being totally uninformed to you being the only one able to deliver to a time frame etc.
  
  If you don't think it is value and you think it is overpriced then in most cases you won't come across as convincing to the client
  Again if you think it is overpriced and not value for money then you are not selling to but conning the client.
  
  No wonder the sales profession is held in low esteem by many - it doesn't help when you are advised to exaggerate or at worst lie. "that the top quality appearance of your sites is matched by the effort your firm lavishes on the back-end programming, which is where your so-called competitors skimp" - If that statement is not true DO NOT LIE if it is then its part of the value proposition and should have played a part in the sales presentation.
  
  There is a whole new argument about professional sales people not knocking the competition but that would sidetrack from the main points
  
  So it comes down to - is it a tough sale because its a high priced item? or is it truly not worth the money? Are you a being con man or a professional sales man?

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  Hardsell07/03/08 Report as spam
  25

  RE: How To Sell Overpriced Services

  Geoffrey: How would you position up-selling a product that is basically an agricultural commodity (with an added ingredient)
  that is not a demonstrable advantage to the user? Note: The selling price of this product is considerably higher than products that perform as well without the additional ingredient.
  
  AJ

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  Geoffrey James, Sales Machine07/03/08 Report as spam
  26

  Let me try again...

  There isn't enough information in your comment for me to figure out an approach. However, I do note that consumer goods used to be sold with meaningless but cool-sounding "secret" ingredients. I suppose you could try something like that, but frankly it has a bit of a desperate aura to it.

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  Rambo_pang4320009/05/08 Report as spam
  27

  About no discount

  Hmm... Most of the customer will try their best to get the price get reduce...
  
  What to do if I meet a customer with strong price battling?
  
  I am weak at this...
  
  

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  tempmails0211/07/09 Report as spam
  28

  RE: How To Sell Overpriced Services

  I m operating a retail outlet dealing in electrical appliances but we have a neighbouring (a few doors away) new retail outlet doing the same but thrashing on prices.
  
  Although our services is better than them but their low prices somehow win customers easily and has eaten a chunk of our shares. Furthermore, they are financially sound. To put in simple their prices are ridiculously low but is profitable for them to survive.
  
  Any gurus out there able to help us out?

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  tempmails0211/07/09 Report as spam
  29

  How to beat low price competitors who are strong? Help pllssss

  I m operating a retail outlet dealing in electrical appliances but we have a neighbouring (a few doors away) new retail outlet doing the same but thrashing on prices.
  
  Although our services is better than them but their low prices somehow win customers easily and has eaten a chunk of our shares. Furthermore, they are financially sound. To put in simple their prices are ridiculously low but is profitable for them to survive.
  
  Any gurus out there able to help us out?