In sales, price and value are all too often heavily dependent on each other, but they shouldn’t be. One is easy to define, the other is the very fulcrum of your making – or missing – the sale.
Price is driven by market factors and the efforts or materials involved. Value, however, is a tougher nut to crack. Value is dependent on many intangible factors, many of which can change with every prospect you engage.
If you were asked who determines the value of your product or service, odds are you would say the prospect makes that call. And you would be wrong. Why? The answer in a moment.
Most likely, at one time or another, you have tried to convert a prospect by offering an additional product or service at reduced cost – or even free, calling it value added.
What does value added really mean? Most sales trainers will tell you that value added means offering extra incentive to the prospect by means of additional products or services for little or no additional price. Sales trainers with heart will tell you something else.
You’ve seen those commercials that advertise some great gadget that does everything, and at the end they say “And as an added value, if you order now we’ll give you two more free!” Why do you need two more if that one gadget does it all? Three for the price of one creates a perception, at least subconsciously, of value subtracted.
For example: You buy paint rollers, a three pack for the price of one. Since the price is now much less, you aren’t concerned with the longevity of the rollers, and most likely will throw them out after only a few uses. Therefore, their value has been reduced.
There really is no such thing as value added, throwing in some trinkets or impractical service does not add value to your offer.
The sales trainers with heart mentioned above? They will tell you that the value of your product/service cannot be increased, since the value you’re offering is built in. Value is not tangible, it’s an attitude – it’s how you treat your customer after the sale. In short, it’s you.
You are the value you need to convey to a prospect to make the sale, and only you can decide what that value is. If you can do that, there’s no need to sweeten the pot.
Do you believe strongly that the value of your product or service goes beyond the price? If you don’t, neither will your prospects.
To your success!