Price is one of the most interesting things. You see prices advertised everywhere you look and in certain types of businesses it is even more so, and based on that, you must think that price is what sells products and services. It would be a logical assumption, but it would be wrong. Study after study has shown that price is not even in the top five.
I learned something in the first year and a half in the car business in 1974 that I have carried with me and taught to hundreds of others that speaks wisdom: Only 4% buy price and the rest buy something else. That something else is value, your personality, your service, product or vendor reputation, product reliability, and many others. Yet that statement just kind of slips past us too quickly and we don't really catch it, so I will repeat it again more clearly: ONLY 4% BUY PRICE!!
I tell you that I have never learned anything quite as valuable as this and it has proven to be true time and again. Yet, everywhere we look, we see price being shouted, printed, posted, compared. It is only that they have not learned this lesson probably. True, price is important. It is definitely in the top 10 (about number 8 on many lists), but it is not the main determining factor. Perhaps a better way to say it is this: Only 4% buy price, but 100% talk price. When they talk price, it is partly out of habit and training. Advertisers are training people to think price, when that is not what will determine their actual decision. It's kind of like a smokescreen. To me, talking price all the time is trying to compete over the lowest gross profit. What sense does this make? Perhaps the objective is to appear to be competitive, but when advertising price it is the lower price that is supposed to win, right? This automatically means that the price will have to decline as others join in the fray and try to also be competitive. Good luck.
A true price buyer will buy the lowest price regardless. The good news is that that person is only a 4 percent occurrence. If you have a 4 percent buyer and you don't have the lowest price, you will most likely lose the sale. You can talk about anything you like, but a price buyer is buying price. That's what they do, so don't be amazed. Just realize this is true. The good news is that there are 96% of the buyers who you can talk to that are not making their decision solely on price. Rejoice! Let the competition have the 4%! You focus on the 96%! Sounds like a great strategy to me.
Here's a quote to think about: "Advertising is the price companies pay for being un-original." - Yves Behar. Think about that for a while. It is an interesting thought. What is unique or original about you, your company and/or your product? What sets you apart from the crowd of price slashers? What value(s) would a customer get from doing business with you that they are unlikely to get with a competitor? Word of mouth is the best advertising ever, so what would your customer tell their friend that would get that friend to come see you? What is your uniqueness?
Here's a mantra to work with. Take a deep breath and breathe out slowly while chanting, "Features, Benefits, Services, Value. . . . Features, Benefits, Services, Value. . . Features, Benefits, Services, Value. . ." Get that vibration of success, the clarity of wisdom, the eye of the sale--this One sale--as you see it morphing into many, many sales. . . Meditate on these daily and price will be a washed-up has been, an insignificant triviality.
Coming up: Pricing Strategies and fun.
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