Sales Coaching Strategy – The Dangers of Price Discounting

Sales Coaching Strategy – The Dangers of Price Discounting

What is the real cost of this type of Sales Strategy?

It might seem logical to discount during an economic downturn. You want to increase sales and attract new customers because your potential customers are nervous, tightening their belts and shopping around for the best price.  The dreaded money objection sends many salespeople and business owners to drop their price to get the sale which can be a non-productive .

There is no doubt that discounting your price could provide you with a quick sale and occasionally improve overall sales. Discounting might help to boost sales and attract new customers in the short-term, but from a strategic perspective it can have a negative impact on your product or service. It is important to consider the potential consequences of slashing your prices. This can lead to encouraging customers to wait for discounts before making a purchase.

Every industry is becoming more competitive and your customers are taking a closer look at what your competitors have to offer.  Is the new low-price competition stealing your customers away?  The most challenging problem business owners and salespeople struggle with in today’s economy is how to defeat the competition without slashing your prices.

Part of your ongoing battle with competitors is on pricing. They lower their prices, and you feel forced to keep up with them and lower yours. There are different strategies involved in pricing that do not always involve cutting prices, but they do involve being more competitive.

Discounting seems so innocent; but it can be tragic to your bottom line. What seems like a minor concession in order to close a sale often has serious consequences for a company.  Loweering your prices weakens your business, stunts it’s growth and makes it more exposed to an attach by your competition.  There is nothing stopping business owners and salespeople who choose to compete on price. You can always lower your price and close a few sales. But at what cost? If you want to sell more products or services, more profitably, to more people, you must resist the temptation to discount and begin focusing on value.

Instead of discounting, learn to create value for your client so they do not feel like they have to ask for discounts. After all, your willingness to give a discount may send a message that you do not think the value is there. But if you must discount, get something of equal or greater value in return; perhaps a larger order, an accelerated payment schedule or some other concession.

While discounting may be appropriate for some companies, the concept should be carefully considered for its effects on your business. Using alternatives to discounting will be more beneficial for your business growth over the long term. Consider which sales strategies will be the most effective for your business and business niche. Ensure that your business is offering the best products available in its field or industry so that you can demand the appropriate pricing for the product’s value.

Most customers who demand a lower price have not recognized the unique value that your solution offers.  If today’s customers are to pay more, they must get more.  You defeat your competition by getting the best possible match between the strengths of your offering and your customers’ needs.

To attract and gain new customers, you need something dynamic and memorable to set yourself apart and not fall into the price trap. If you think of yourself as offering a solution to a problem rather than offering the cheapest price, then you are well on your way to succeeding in sales and in your business.  Remember, it’s not what you sell, it’s how you sell.

One more thing to consider…..Need a “911” Strategy Session? If you are struggling with sales and/or keep running into the same obstacles and issues, reach out and schedule a 30 minute complimentary call with me. You never know…it could change your sales results and bottom line. This session is an opportunity for me to ask questions and learn where you are in your business, where you want to go, and what might be holding you back.

PS. THIS IS NOT A FREE COACHING CALL. That would be irresponsible of me to offer you, as change doesn’t happen overnight, and certainly can’t happen on one phone call. This is purely a chance for us to get to know each other, see where you are in your business, and see if it makes sense to work together. I want to serve you deeply, and in order to do that, we need to have a frank conversation about your business first.

Contact Sales Coach Liz Wendling at 303-988-9157 to get more information on sales coaching and effective sales strategies for your company.