Offensive or Defensive Pricing Reveals

There is a good reason not to discuss pricing until you’ve done enough discovery work to understand the investment that is necessary to produce the outcome your dream client needs. This is especially true in larger, complex deals where different levels of value can be created and different investments required.

Destructive Defensive Reveals

In many cases, refusing to share your pricing can make you look defensive, as if you are concealing something. Hiding your pricing is a sign that it is higher than your competitors, even though there is nothing inherently wrong with having a higher price than your peers.

That defensiveness gives your prospective client the feeling that you are uncomfortable with your pricing, and that it is so much higher that the act of simply saying your price out loud will cause your prospect to disengage and immediately withdraw from any further communication. When you are defensive, it looks as if you cannot justify the delta, and when you can’t, neither can your prospect.

This defensive revealing of your price can work against you when your price is higher.

Using Pricing to Differentiate

When your price is higher because you create greater value and need to capture more to deliver it, it often makes better sense to go on the offensive and immediately disclose your higher pricing—especially when you can easily justify a higher price.

By sharing the price very early in a conversation, you can also share the reason your price is higher than your competitors, how you invest the difference in your prices to create greater value, and why your clients believe this is the right decision to make.

You can also explain the concessions, trade-offs, and risks your prospective client is going to be forced to make by selecting an alternative with a lower price. These concessions, trade-offs, and risks are the higher cost your prospect will pay for accepting the lower price.

You may believe that a lower price makes it easier to win. This isn’t true. In more cases than not, it’s the value that is being created that matter more than pricing, unless you don’t believe and behave as if this is true.

Filed under: Pricing

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