Do your prospects suffer from sticker shock?
You know the pain of getting excited about a potential new purchase, only to recoil when you read the price tag? It’s called sticker shock, and it’s not pretty.
Sticker shock is the clash between the value of the item as the seller perceives it and its value as the buyer perceives it. Whether you’re on the buying or selling side of a transaction, sticker shock does nobody any good.
There are any number of reasons why a purchaser may be appalled at an item’s price. He may:
- be completely out of touch with (i.e., clueless about) the going rates for the product or service
- realize he has not budgeted enough money for the purchase
- simply feel the price is too high for the value he expects to receive
When shopping for a tangible product, you can discover what it costs simply by checking out the price tag. When you’re in the market for an intangible service, however, finding out your cost is not quite so straightforward. Often times, the answer turns out to be the dreaded “it depends.”
I personally feel that “it depends” is a legitimate answer for a service provider to give. After all, it’s unreasonable to expect that your evergreen on-demand webinar would cost the same as your customized, one-on-one consulting program. Couching your different prices in terms of different levels of service is appropriate.
However, no matter what price you’ve set and no matter what type of service you’re offering, you absolutely must clearly demonstrate the service’s value to your prospect. If he doesn’t see the value, any price will feel too high.
Sticker shock is an unpleasant surprise no matter when it hits. From a service provider’s perspective, however, there’s one time it’s especially painful: when you think the prospect is ready to sign on the dotted line, only to pull back because he’s decided what you’re offering is “too expensive.”
The value of your offering is what your prospect says it is.
So what can you do to effectively deal with sticker shock, thus making life easier on your prospect and yourself?
The easiest way to “deal with” sticker shock is to do everything possible to ensure it never arises in the first place. In fact, to a large extent this one tactic serves as an umbrella for all the following ones.
Remember that people will use price as an excuse not to purchase if they feel they’re not going to get their money’s worth. This means that a major function of your prospecting – whether you’re blogging, participating in relevant online discussions, or having real-time conversations with the prospect – is to demonstrate the value of what you do for your ideal clients. The clearer the value, the easier it is for the prospect to say “yes” when you actually ask them to make the investment in your services.
Find out what your ideal client truly needs.
The true value of your service lies in its ability to solve your prospect’s biggest problems. In a world of flawless marketing and prospecting, what you see as your service’s problem-solving value will be identical to what your prospect sees as the value. If you’re operating in a somewhat flawed world, however, you get to be especially careful to couch your value in terms that make sense to your prospect. Far too many entrepreneurs fall into the trap of waxing eloquent about benefits that are not compelling to their prospects, while ignoring those that the prospect considers to be deal-breakers.
So what are some ways to get deep inside your prospect’s head and gut?
- Re-vamp the questions you use to draw out the pain they’re currently experiencing.
- Ditto for the questions that get them thinking about how their lives will be so much better when their current problems are solved (hopefully by you).
- Be quiet! Once you’ve asked a question, give him time to process it and respond. The more he talks about the pain of not addressing his current situation and the joy/relief/excitement of solving the problem, the more powerfully he’s doing the selling for you.
- Don’t waste your precious face time gathering data. (BIG thanks to my friend Pat Schuler, founder of Kick Butt Sales Training, for this one.) When you’re figuring out if and how you can alleviate your prospect’s pain, focus on the emotional costs of her situation, NOT on the nuts and bolts of what she’s currently doing or not doing. For the most part, that can wait until you’re hired and mapping out your problem-solving strategy.
Resist the temptation to close too quickly.
Just as it takes two to tango, it takes two people to jointly decide if they’d do good work together as service provider and client.
And while excitement about and confidence in your ability to provide high-value service can certainly serve you well, it can also bite you on the behind if you try to close before your prospect is as excited and confident as you are.
I had a major brain burp the other day and shot myself in the foot by forgetting this very rule of thumb. (Maybe that’s where I got the idea for this blog post… ☹ ) The prospect I was speaking to met virtually all of my own criteria for what constitutes my ideal client, and I had a ton of ideas flying through my brain about what I could do for her.
Unfortunately, I let myself get carried away by my excitement, and I totally jumped the gun by starting to talk about what consulting package I would recommend to her before I ensured she saw as much value in my service as I did. Sigh. We may yet work together, but I’ll need to make up a lot of lost ground in order for that to happen.
(Note to self: Re-read relevant blog posts before meeting with prospects.)
Learn from your own experiences as a consumer reeling from sticker shock.
One of the most effective ways to not shock your prospects is to avoid doing the things that caused you to be appalled by the price of a service you were interested in.
Think back to the last time your mouth dropped open upon learning what someone wanted to charge you for a service. Why was the total cost such an unpleasant surprise to you? Did they talk about features instead of benefits, or processes instead of probable outcomes? Did they fail to offer real-life success stories and testimonials? Did they move in for the kill too quickly? Did they talk in generalities rather than specifics?
Whatever has turned you off in the past is likely to also turn off your own prospects. Put yourself back in the buyer’s shoes and identify those turn-offs, then do whatever it takes to ensure that none of them sneak into your marketing messages and prospecting processes.
What’s been your experience with sticker shock, on both the selling side and the purchasing side? Have you found any common threads that can alert you to a weak spot in your communications?
Or are you still not sure how to effectively connect with your prospects, much less what to say to them? If that’s the case, I can share some helpful tools.
My specialty is showing entrepreneurs how to get results by tackling the right tasks at the right times. Rather than get caught on a hamster wheel of busyness-without-results OR stuck in the quicksand of overwhelm, I show my clients how to zero in on the outcomes important to them, map out action plans to create them (without getting sidetracked), and be accountable for implementing those goal-centered action plans.
Can I do that for you? Probably. Should I? Maybe.
We might make a fabulous problem-solving team, or we might not. One easy way to find out to our mutual satisfaction is to get acquainted by phone. By asking and answering some questions, each of us will be comfortable with our decision to forge ahead, wait until later, or simply wish each other well and say good-bye.
There are a couple of ways to set up this no-charge, no-risk conversation. Either email me with “You’re not gonna shock me, are you?” in the subject line to suggest a date and time, or simply grab a space on my calendar.
And in the meantime, ask yourself: “Am I making it easy for my prospects to say ‘yes’ – or to say ‘no’?”
(By the way, thanks to Bark for posting the image of overwhelm in the Creative Commons section of Flickr.)This entry was posted in marketing and tagged marketing, prospects. Bookmark the permalink.