You’ve been talking to your prospect for weeks, months likely. You’re psyched about adding another customer to your client list. You’re almost there – about to close that deal. But at the 11thhour you get the wind blown out of your sails, “We love you guys. Love your product. Love you. But we’ve been talking with a competitor and have been quoted a lower price. Can you beat it?”. Now, you need to know how to win a price war.
You’ve likely encountered this before. And although it isn’t ideal, it’s not entirely unmanageable. So how do you keep afloat? Here’s your go-to answer.
Putting price aside, do you think our product is better than theirs? Does it deliver more value to you? Their answer: Product is exactly the same in value the only difference is the price.
Take stock of your position
As you recognize the trend toward “war”, you should takes steps to analyze certain aspects of your company and product. According to Harvard Business Review, “Good diagnoses involve analyzing four key areas in the theater of operations. They are customer issues such as price sensitivity and the customer segments that may emerge if prices change; company issues such as a business’s cost structures, capabilities, and strategic positioning; competitor issues, such as a rival’s cost structures, capabilities, and strategic positioning; and contributor issues, or the other players in the industry whose self-interest or profiles may affect the outcome of a price war. “
Change the narrative on pricing.
This is what you say, “Not only should you go with them, but I’m going to help you get an even lower price out of them.” I’ll support you every step of the way. I’ll send you a quote for an even lower price and you can show it to them so they will go down in price even more.
Why am I going to do this? The reality is that we will never be the cheapest. If it’s price that you’re after, it’s better that you don’t go with us. Our solution is premium – and our price matches the value. We’ve proven that our platform crushes in sales and offers more value than anyone else in this market. But if you want the cheapest, no problem.
It’s war, turn the tables on them.
By positioning yourself as the better solution, they now can see that you can’t devalue it. What you’re offering customers is not to win a few bucks, but to win big in sales. Keeping this position will work to help you close the deal. Don’t get into a price war. If you put the label of cheapest solution, then you’re no longer in the business of value.
To offer something truly unique you should focus on building a great partnership with great customers. Getting out of the price war will attract the kind of clients that aren’t trying to nickel and dime you but instead are happy to pay more because they know who they are going to work with – and they are excited about it.
Focus on being a premium solution and build partnerships with those that value that. It should be about value first because when you offer value, you, in turn, receive value in the form of great customers.
Don’t get into price wars: seek out those that know what you can deliver. Deliver on it. And you put yourself into business with the best. And watch – you’re going to attract the right kind of customers. Stick to your guns and be a company of value rather than the cheaper alternative. This is how you win a price war.
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