Tuesday, October 13, 2009

The Lowest-Price Assumption

A common trap that we fall into when the economy is bad is assuming that a low price will guarantee a sale. That's called the lowest-price assumption. While a ridiculously high price will ensure no sale happens, we can't assume that a low price is all the customer is looking for.

Even in tough economies, people want high quality stuff. They don't want the cheapest, poorly made item. They still want the best, or at least something they consider high quality.

So if we make the lowest-price assumption, it means we feel the pressure to provide the best product at the lowest price, which of course means we lose either way: if they don't buy, we lose a sale, and if they do buy, we lose money.

It still comes down to relationships--do customers trust you, are they comfortable telling you what they want--do they want you to get into their businesses? If all of that is a yes, then the rest is easy--providing them with the product they want at a fair price.

If you don't do the above, there isn't a low enough price that will overcome it.

Barry LaBov
LaBov and Beyond

1 comment:

  1. Good post, and the last point is something a lot of people overlook, whether they are selling a product or service or looking for a job. Their brochure or resumes says a lot about "you're going to like my product" but neglects to say enough of "by the way, you're going to like me too." Simply liking the person from whom you're buying is a significant part of a sales experience.