This post was written as part of the IBM for Midsize Business program, which provides midsize businesses with the tools, expertise and solutions they need to become engines of a smarter planet.
The last thing you want to do is to defend your pricing after it comes under attack by a low-priced competitor. Value is tougher to defend when you are on your back foot. Worse, there are stakeholders in every company who are easily swayed by the big lie that you can have better results, better service, and greater outcomes while making a smaller investment in those results.
- Sell your value proposition from the start: If your price is higher than your competitor’s, make that point clear from the very beginning of the sales process. It isn’t a secret–or it isn’t going to be a secret for long. Make it known that your price is higher but that the value you create is greater. Your value proposition is what it is; wear it proudly.
- Justify your higher price: All things being equal, your client is right to choose the lowest price. It is your responsibility to explain to them why your price is higher and why you are worth paying more. It isn’t obvious to them, and it isn’t there job to understand your value proposition–these outcomes belong to you as the salesperson. You justify it–and teach them to do the same.
- Take credit for producing the value you create: Your clients are under a continuous and unrelenting assault from your competitors. I once had a competitor send a letter to my clients telling them how much they could save by firing me and hiring them. Your competitors are aggressive. The time to defend the value you create isn’t after you are under assault. Report your results. Take credit for the value you create–and do so proactively, not after you are under pressure.
- Move to higher levels of value: Fear complacency. You need to move to higher levels of value. You need to move from new idea to execution to new idea. Creating new value will keep you one step ahead of your lower priced competitors and it will keep you off your back foot.
The real trick to defending your pricing and the value you create it do so proactively, to get in front of it.