Handling Difficult Pricing Feedback
If existing customers are giving you less work and naming price as an important reason why, ask them to be as specific as possible about where your pricing has become an issue. Good customers, especially those otherwise content with the relationship, are happy to share their benchmarking with you because they know they will benefit from helping their suppliers know where their pricing issues are. It will probably be too late to win back what you lost on price, but you at least know what to do going forward. Take that feedback to heart for your pricing to all new opportunities, not just that specific customer.
If prospective customers are consistently pressuring you on pricing across the board, you should adopt the steps above but with awareness you’re likely to get less honest feedback than from existing customers. Before blindly throwing around large general discounts and cutting rates, look for internal benchmarking information by talking to recent hires, seek external benchmarking information on what specific issues may exist, and/or refresh all your internal cost estimates across your offerings. You want your corrective actions to be as specifically targeted as possible, to ensure you’re attacking both near-term issues and longer-term items that would otherwise persist after the short-term situation improves.
Of course, it’s best to stay ahead of the pricing environment and avoid broad-based negative pricing feedback in the first place. We can never fully avoid or prevent losses on price or negative pricing feedback, but we should also seek to proactively stay ahead of the situation. Losses on price are an incredibly expensive way to learn your pricing is out of whack. So:
This advice works in all economic environments, but especially in difficult ones like we are experiencing. Don’t give up, don’t go off schedule, and don’t wait until you’ve lost millions of dollars of opportunities to figure out where your pricing needs to change. Listen to your customers, ask them for information, see what your own people already know, go to other external sources if need, and stay on top of your internal costs.
Never stop doing this.
Needle Moving, Funnel Expansion. Revenue Hunting. Culture Creator. Sales Leadership & Accountability.
4moJoel - that last bullet resonates most on the Sales front. Sell your price to how you’ll bring value to the clients future success. How their issues, needs, and goals will be met and achieved by your services and team. Do this, do so early, ahead of the competition, and your price will hold much stronger. Being early let’s you showcase strategy and consultive support. Better value. Let the late comers commoditize themselves, having to focus on price first, and thus missing the chance to lead with expertise … Less value, dollar to dollar.
Life Coach & Sales Consultant to High Performers and Businesses || 15+ Years in Corporate || Over $1B in Career Sales || Built Multiple Six-Figure Businesses || Certified Coach || Host of The Honor You Podcast || Speaker
4moGood thoughts - too many reactive pricing convos taking place! I'd also say, which is probably painfully obvious but goes overlooked - pay attention to your pricing. Lots of sales people and ops folks don't even know what the actual pricing is (gasp). ;)