Price and Value Are Not the Same

My Grandfather used to say “Price without quality is waste.” What he meant by that of course was that getting a good price on a bad or wrong product was not a good deal.

 

He ran a small grocery store for nearly 50 years. He started when all grocery stores were small and it was his philosophy on price vs value that allowed him to survive when the “corner stores” were being devoured by the Supermarkets. 

 

He knew that “price” was simply what people paid and that “value” was what they received in return. When people were convinced that there was additional value to be had they would willingly pay an additional price. 

 

Good organizations and great salespeople know that same thing. They do not sell on price, they instead sell the value that their product or service offers their customer. 

 

To be sure there are some people who buy almost solely on price. Most often these buyers won’t be tempted by value because they are relatively short-term thinkers. A common refrain is “I can buy two of these for what I’d pay for one of those.” That could be true but what they fail to see is that the “one” will perhaps last 4 times longer than the “two.” 

 

But here’s another reason so many people seem to buy on price: poor salespeople cause them to make that mistake. 

 

Poor salespeople do not have the ability to communicate the value their product provides the customer. When a poor salesperson, or more likely, a poorly prepared salesperson hears their price is too high they immediately begin thinking they need to discount their price to earn the business. What they don’t understand is that they aren’t “earning” anything by accepting less for their product or service, they are merely buying a sale. 

 

When a salesperson buys a sale it’s likely everybody loses. The salesperson and their company obviously loses; they have built value into the product and they are not receiving the money they need to sustain that value. 

 

But here’s a surprise; the customer likely loses too. They lose because the product or service that they want will eventually go away. If it doesn’t go away the service that came with it will decline and they will really need the service because the value and quality in that product will almost certainly decrease over time. 

 

When I was just a kid I’d be at the Farmer’s Market at 4:00am on Saturday morning with my Grandfather to hand select only the finest, freshest fruits and vegetables that our customers would buy later that day. 

 

I suppose that most people don’t remember those days but when I walk into the produce area of my local supermarket today all I see is the stuff we wouldn’t touch back then. Today if you want truly high quality fruits and vegetables you either go to a speciality market or you go directly to the Farmer’s Market yourself…and you pay more, especially at the specialty markets,…because you see value in the quality. 

 

It turns out, price without quality IS waste, maybe not a complete waste but you’re certainly not getting what you pay for.

 

If you’re a salesperson today then learn the difference between price and value. Understand that you’re doing your customer a disservice by not explaining the value your product or service provides to them.

 

They may feel lucky getting a good price today but the sting of poor quality far outlasts that lucky feeling. 


Your customers, and most every bit of research supports this, your customers would rather pay a fair price for true quality than receive a low price on an inferior product. When you understand that absolute fact then you understand what you need to know to actually earn a customer’s business.

What Are You Selling?

In the factory we make cosmetics; in the drugstore we sell hope. – Charles Revson

Charles Revson, the founder of Revlon Cosmetics, was not a well liked man. 

He was so offensive in fact that vendors often refused to do business with him. But in spite of his personality he still managed to build a multi-billion dollar cosmetic empire.

That’s because he knew what he was selling – and it wasn’t cosmetics.

His quote above said it all. His ads sold hope by using most of the ad’s space on images of beautiful movie stars and glamorous models. The add copy made bigly promises of instant beauty with nearly no effort. He understood that nobody really wanted cosmetics, what they wanted was the beauty. So that’s what he sold.

I remember one of my first sales managers telling me that the best salespeople sell verbs, not nouns. When it became obvious that I didn’t understand what he meant he clarified it by saying they don’t sell the steak, they sell the sizzle.

Through the years I’ve come to understand that the best salespeople don’t sell their product, they sell what their product can do for a prospect. 

The challenge here is really two-fold. First you have to be selling a product that benefits someone. Then you have to find that someone it benefits and show them how it helps them.

By the way, if you are trying to sell a product without benefits then you need to find another product. If your product is the equivalent of an artificial appendix then it may work great but finding a market for it will be nearly impossible.

If you want to sell more next year then don’t sell what you’re selling, sell what people are buying. Don’t sell what your product is, sell what it does and most importantly sell “why” it does it.

Develop the mindset of helping your customer, not just making the sale. The very best sales professionals know that the more they help the more they sell. The very best sales professionals are passionate and enthusiastic about how their product or service helps a customer and they pass that enthusiasm to their prospects.

Just remember, people will seldom actually buy your product, they will buy what it does….for them.

The People Business

I was very fortunate years ago to have a mentor who was also a great salesperson. Whenever someone asked him what business he was in he would answer “the people business.” 

My mentor’s name was Jack and for 40 years he owned a commercial heating and air conditioning company. When asked how he got “people business” out of heating and air conditioning he replied, “simple, my business is about helping other businesses and organizations provide a comfortable and productive working environment for their people.” 

Jack believed that every business and every product was in some way about helping people. He often said that if your product or service didn’t in some way benefit people then you wouldn’t be in business for very long. He taught me to never sell my product, he taught me to sell what it could do for the people who might buy it. 

The moment a business or it’s leadership lose sight of the fact that, regardless of what they sell, they are in the people business their potential for long-term success begins to decline.

If you’re in business, any business, then you are in the people business.

There should never be a policy, process, or procedure that is more important than people. Your people are your business, both the people who work for your business and the people who are served by your business.

Years ago the pilots of the now merged Northwest Airlines went on strike. It was very contentious and both sides, the airlines and the pilots union, starting running ads on local radio to “get their side of the story out.” Basically each side said the other were complete idiots. 

I wasn’t too sure about flying on an airline run by idiots but I was certain I didn’t what to fly on a plane piloted by someone considered to be an idiot by the very airline that hired them. I don’t really know much about the airline business but I do know some stuff about the people business. Something one of the striking pilots said during a radio interview has stuck with me to this day.

The pilot said the airlines whole problem was that they were trying to make customers happy while doing nothing to make their own people happy. He said he believed it impossible to have happy customers if the people tasked with making them happy were unhappy.

I doubt whether that was the airlines “whole problem” but it was absolutely one of the biggest. Northwest Airlines forgot that they were in the people business and they also forgot that their employees were people too.

I believe in measuring pretty much everything a business does, you need a yardstick to see progress and determine opportunities for improvement. However, when your metrics become more important than your customer…or your own people, then you have a problem. Metrics are a guide to success, they are not a bible for success. 

When people are involved in your business you will sometimes need to throw the numbers out to do the right thing and remember, people are always involved in your business.

Put people first and your business will last!

Did You Ask?

Salespeople get what they ask for! If I had a dollar for every time I’ve said that I would probably be writing this from a beach somewhere in the Caribbean. That salespeople get what they ask for isn’t always true but it’s true far more often than it is not. 

Salespeople who consistently ask for the order will nearly double or even triple their closing percentages. Just by asking for the order!

Early in my sales career I discovered that an incredibly high percentage of sales calls ended without the sales person ever really asking for the  order. One day upon returning to the office from a sales call my sales manager asked me “if I asked?” I answered “did I ask what?” He said, “did you ask for the order?” 

My answer was of course I did, I always did. So he asks me how I asked, what words did I actually use to ask for the order. When I hesitated a bit he knew he had me. When I said I asked the customer “what do you think?” he just smiled and said that next time I should really ask. 

I learned through the years that questions like “what do you think” and “how does it sound” are not order asking questions. They are flimsy substitutes that salespeople use when they don’t have the confidence required to ask a real order asking question. 

A real order asking question is one that requires a yes or no answer. They are closed-ended questions that leave no doubt as to the intentions of the prospect, they will either be doing business with you or not. 

Good salespeople always ask for the order. Great salespeople know when to ask. 

Great salespeople earn the right to ask for the order by working with their prospect to determine how and IF their product or service will actually help the customer. They ask a ton of focused questions that help their prospect see the fit between the product and their situation. 

When the salesperson has helped the customer see the benefits of their product and how it will help them, then they have earned the right to ask for the order and ask is what they do. 

They ask by saying something like “may I have your business?” They ask directly. They wait for a yes or no before they say anything else. They get the order.

Even if you’re only a good salesperson and aren’t sure what questions to ask, even if you’re not 100% knowledgeable about your product or service, always asking for the order will increase your sales. 

If you don’t believe me then prove me wrong by asking, it’s the only way you’ll ever know for sure. 

There is No Value in Free

When I was growing up there was a little bakery in our neighborhood that sold the best brownies. They were 10 cents each or two for a quarter. They sold lots of brownies 2 at a time.

I wonder to this day how long it took for people to figure out that the “deal” wasn’t such a good deal.

I think the pricing worked because everyone loves a bargain. We love bargains so much that sometimes we don’t stop to even figure out if we’re really getting one.

Salespeople were just people before they began selling so they are just like everyone else, they love a good deal too. They especially love offering them to their customers and prospects. So much so that they often throw around the word “free” as if what they are offering is no better a bargain than 10 cent brownies selling at two for a quarter.

Thoughtful, professional salespeople don’t offer anything for free. They don’t need to because they add value, real value to every transaction.

Salespeople who offer “free” anything are also more likely to attempt to earn business by selling on price. That is a short-term strategy that is not sustainable in the long-term. When you sell on price you eventually lose on price.

So here’s some guidance for salespeople looking to be more professional: Understand that the only things truly free are those that bring no value to anyone. If your offering something of value to your prospect then stop saying it’s free.

Share with your prospects that you’re willing to absorb the cost in order to provide them with additional value, or that you and your company are willing to make the investment on their behalf for some additional product. If something offers real value then it can’t be free, somebody has to pay for it. If that somebody is you or your company then tell that to your prospect, don’t just devalue your offering by being lazy and saying it is “free.”

If you’re a professional salesperson and you, your company, and your product bring real value to customers then say so, repeatedly. To most people, if only subconsciously, “free” means “worth nothing” even if the free thing is something they want.

Always look for ways to ADD value, not subtract it. You will sell more, at higher margins, and you won’t have to offer anything “free” to do it.

Now, go sell something!