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There’s a semi-famous Penn & Teller sketch “Bottle Survey” in which a waiter in an upscale restaurant presents ordinary tap water under extraordinary descriptions to raging success. A water “steward” distributes a menu and discusses the finer points of water purportedly shipped in from the mountains and streams of exotic locations around the world and costs as much as $8 a bottle.
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While funny, it’s also a lesson in establishing value. The water actually comes from an ordinary garden hose out back. Even after explaining this to customers, many still didn’t believe it. Ahhh…the power of a good sales presentation.
As you can tell, people are willing to pay more for a product if they think it gives them special or significant value – if you present it the right way. If you need to know the time, what difference does it make whether it’s a Timex or a Rolex? Yet, when it comes to the value of having a Rolex versus a Timex, it’s a different answer isn’t it? Both keep perfect time, but which one would you rather have on your wrist and why?
You’re probably selling stuff that’s a lot more valuable than hose water, but are you selling on value? Or are you still convinced you have to out competitive bid your competition? Selling on value (not price) involves a balance of confidence, customer targeting, and customer response. It’s a lot more difficult as technology gives consumers greater access to price information and competition. Here are some simple steps to start selling your value:
Target Your Consumers
This isn’t as simple as it sounds. Obviously, it’s somewhat dependent on your product or service, but many companies make the fatal mistake of not targeting properly and it forces them to compromise on price. Narrow your target market and understand that your product may not be for everyone. Selling to every breathing prospect is not always a good return on your investment or time. Only about a third of consumers are focused solely on price. The rest…and that’s 66% of them…are willing to at least hear your argument of why they should pay more for yours. It’s very necessary to know who your target market is as well…and not just demographically. Understanding who your customer is means more than just age, gender, and income. What are their problems? Why would they need your product? What issues are they having that your product solves?
When you’re talking about the value of your product over your competitors, you shouldn’t be so quick to vacillate on price. Don’t automatically suggest flexibility. It shows lack of conviction. You can be confident without being defensive. Dropping the price without hesitation so soon after explaining the advantages you offer is not a good strategy for building value. Besides, often the customer obsessed with finding the lowest price turns into the biggest headache.
Personal touches and responding to your customer’s needs is more difficult than you might imagine. It’s hard to accept criticism without being defensive, but don’t always combat bad reviews. Respond with an invitation to solve the issue in a healthy way. Develop better rapport with your clients by getting to know their needs and desires. The customers that see your value understand you’ll be there to provide customer service and never take them for granted. In a recent study, more than 60% of customers say they would switch brands if they felt their current brand wasn’t responding to their needs…so provide good service for the lifespan of that customer.
Value is long term. Price is short term.