Welcome to SALES with ASLAN, a weekly podcast hosted by ASLAN Co-founders Tom Stanfill and Tab Norris, geared at helping sales professionals and sales leaders eliminate the hard sell. At the end of the day, we believe that selling is serving. ASLAN helps sellers make the shift from a ‘typical’ sales approach, to one that makes us more influential because we embrace the truth that the customer’s receptivity is more important than your value prop or message.
The goal of these interviews is to spotlight various experts in the world of sales and sales leadership – sharing informational stories, techniques, and expert interviews on the sales topics you care about.
The following are notes from Ep. 138 – The Price is Right: How to Defend the Value of Your Solution
In this episode, Tom and Tab take on a topic that is dreaded amongst most sellers: price objection. They deliver a positive approach to this tough subject, sharing how to defend the value of your solution and respond to those objections that may crop up when discussing price with your customers and prospects.
Listen to the conversation here:
Or check out the full transcript:
00:13
Tom Stanfill
Welcome to another episode of SALES with ASLAN. I’m your host, Tom Stanfill here with my trusty guide and co-host Tab Norris. As we affectionately refer to him as Dr. Norris, the Chuck Norris of sales training.
00:30
Tab Norris
Thank you, Tom. Always a pleasure seeing your bright cheery, face.
00:35
Tom Stanfill
Good to see you. My friend. Good. We, we, we kind had, we replayed, I don’t know if this, but we played an oldie and goody last week on oldie, but goodie kind of got, went back in the archives and pulled in a new episode and went deep. One of our more popular episodes. Cause I know you and I were on vacation. We.
00:54
Tab Norris
Were, we took a week off. It was this be honest.
00:57
Tom Stanfill
Yeah, go ahead and take a little shape. And we took it together. That’s how much we love each other. We took it together, a little golf vacation with our close friend, Jackson Roper, shout out to Jackson Roper. We love Jackson – Happy birthday. We want to talk and kind of get back on track here Tab. We want to talk about something that I’m seeing a lot in the market as I’ve been working with sales organizations. I know you have, I want to talk about what most people think is the dreaded price. Objection.
01:33
Tab Norris
Yeah.
01:34
Tom Stanfill
The, the old, the, the customer that says, Hey, your price for this is what I was told at a workshop. Recently, I was delivering in San Diego. Your price for this is 15,000 and the competitor’s price for this 14,000.
01:50
Tab Norris
That’s a little gap.
01:51
Tom Stanfill
Okay. Here, I want to talk about Tab real quick. Before we dive into this bending price and defending the value of our solution or, or responding to the price. Objection. You could have several different topics to think about – categorizes topics, but that’s all we’re talking about is how do we defend the value of our solution? I want everybody to listen to this podcast to think of this as a positive, not a negative. It’s yeah. I want everybody, because here’s the why this is a positive. If, if you’re working for an organization to listen to this, if you’re working for an organization that offers the lowest price and you’re in the market, they don’t need you.
02:35
Tab Norris
Yeah. That’s true. Very true.
02:38
Tom Stanfill
You are a walking billboard.
02:40
Tab Norris
Yeah.
02:41
Tom Stanfill
You’re just supposed to show up until, Hey, we’re the cheapest or the cheapest. If you’re not working for the price, that’s a good thing. Your role is to demonstrate the value of your solution and why the decision makers should pay more. So that’s a good thing. That’s a challenge that you should be up for and excited about, because that means that you’re bringing value to the organization and to your customers. That’s M tab, what are you seeing out there?
03:06
Tab Norris
Same exact thing. It is, and it’s, it’s one of those things where at first it feels like it’s how are we going to overcome this? How are we going to do this? This just seems too big of a gap. If it’s mostly talking about flipping the flipping our script, just kind of thinking about it from a completely different perspective. I, I, it reminds me of when I first started in sales with Motorola, were 30% higher than all of our competition. It was the greatest first job because it set it up in the beginning. Exactly what you just said. If I didn’t know that why in the world, they would spend 30% more. I didn’t have a job. I would never sell anything. And it was great. There was no option to come even close to dropping the price to fix, to fit. So it was awesome.
03:55
Tab Norris
I think we’re really in that spot now, there’s just so many pressures and things going on in the marketplace right now that I think price has just bubbled up. I think I’m seeing it a whole lot more than I was before.
04:06
Tom Stanfill
Well, and the two, because customers have so much access to information about what’s what does this thing cost? There’s so much, so much information on the internet. They would probably like, look, you’re not providing value to me in, in, sharing information about your product or what it costs, ? Why do I need to talk to you versus there’s no hiding there. So yeah. It’s funny. You talk about where you started. That’s actually, I started in for an organization, my first sales job, I was selling mortgages. I was a loan officer. Talk about a tough value sell and they’d say, okay, so this is back when mortgages were 13%. Somebody would come to me and say, okay, well you’re quoting 13%. The other, the competitor’s quoting 12 and a half percent. That’s going to cost me $40,000 over the life of the loan or whatever it is.
04:57
Tom Stanfill
I just make that number up. Why should I pay $40,000 more to close the loan with you? But, here’s the thing I learned to answer that question. I love what you talk about is flipping the script on this, because really what we want to change. This is kind of where it starts is we want to change the mindset from overcoming an objection to helping the customer make the right decision. It’s in the customer’s best interest to go with a lender. Who’s was, you know, a cheap lender. They were offering cheap price where they could change the price right before closing, or you go to closing and you can have a moving van pull up. All of a sudden they’re like, oh, you know that 12 and a half percent now, 13 and a quarter, do you want to close? Or you want to start over?
05:42
Tom Stanfill
And that happened all the time. There was all these kinds of, there was all these reasons why customers should pay more for the mortgage. Anyway, I love look forward to diving in.
05:51
Tab Norris
Well, good. Well, I, I’ve heard you talk about this before, and I’m excited about you sharing the wisdom that you have around this. I’ve heard you talk about, what’s required to pull this off and like, in some steps, I believe there’s some things that are required and then some steps that you really need to go through in order to be effective. Can you tell us a little about what’s required?
06:18
Tom Stanfill
Yeah. That’s a, that’s a great way to set it up, but I do think, I think there’s another way to say this. If there’s a certain, a couple of things that have to happen before you respond to the price objection, or you can’t effectively. Right. Number one thing that needs to require is you need to be able to, you need to go through discovery first.
06:36
Tab Norris
Yeah.
06:37
Tom Stanfill
In just like we talked about in the setup, if our mindset is to help the customer figure out why they should pay more, you can’t help them make that decision unless you’ve been through discovery. Otherwise you’re just like, I don’t know. How you should just pay more. You should pay 50,000 because it’s better because I think it’s better are. What happens is reps just start talking, you start saying, well, this is why some people, pay, you should pay more. And this is why it is. The guys will, that doesn’t apply to me. Well, well, it should apply to you. Well, what about this? You just, you don’t have two things. You don’t have the relationship and you don’t have information. If you don’t go through stubborn, you don’t have a relationship and you don’t have information, relationship determines, influence. If you don’t have a relationship with the customer, they’re not going to listen to you.
07:26
Tom Stanfill
They’re not going to be receptive. Discovery is where the relationship starts and you also need the information you need to understand. What’s their informal decision drivers. What really, they care about what they really value. What’s the what’s at stake. If they don’t make it, when they’re going to make the investment in your solution, how did, why do they need it? What’s it for it’s all of those things we need to know in discovery. We need to uncover that and discovery before we ever can make our case as to why they pay more. Otherwise it’s just arrogant. Just to assume we know.
08:00
Tab Norris
How to lay leverage.
08:02
Tom Stanfill
I got a lady come to my house. Recently. We were talking about renovating and I’m like, I don’t know if I know discovery. I don’t know if I should. We’ve talked about this on the podcast. I don’t know if I should pay that much for what you’re offering and just like, here’s why you should. I’m like, you don’t even know me.
08:20
Tab Norris
I.
08:21
Tom Stanfill
Said, what if I’m selling my house next month? Could I do that? Well, I don’t know. I just know they told me right here to say that you should pay more.
08:29
Tab Norris
Punch the button. Here you.
08:30
Tom Stanfill
Go. Right. Here’s my three bullet point. We got to go through discovery first. That’s good. Secondly, you need to understand the value of your solution. Why customers should pay using the analogy we started off with why they should pay $50,000 versus 14 and why they shouldn’t. Right? Cause there’s times where they shouldn’t invest more right. There’s time. We should know that before we ever dive into discovery, I, I was one of the examples of that is early on in the Azilen days tab, I was setting up a training in Philadelphia somewhere. It was like outside of Philadelphia. I don’t know. Maybe it was near Princeton. I can’t remember exactly what it was, but I had decided, what, I was going to lead this workshop and I was in charge of it and I had to set it up. And, and I talked to two places.
09:22
Tom Stanfill
I talked to a really cool quaint in a little boutique hotel. Right. I talked to a conference facility. Two very super expensive the conference facility was let’s just say in my mind, expensive, it was like $15,000. And the other place was like $2,000.
09:41
Tab Norris
All right.
09:42
Tom Stanfill
You know, it was like, so.
09:44
Tab Norris
Yeah, the boutique, I mean, it says the boutique place that have much cooler curtains.
09:48
Tom Stanfill
Yeah. It was like low plate in the little pan. Probably. Yeah. It probably wasn’t. It was probably something like 10,000 versus 2000, something like that to rent the facilities. And, and I talked to the conference people and I said, what do you cost? What do you, what do you charge? She said 10,000. I said, well, that seems expensive. I can say it. This boutique hotel for 2,500. They got a conference room and it seems fine. She didn’t really know what to say. And.
10:17
Tab Norris
There you.
10:18
Tom Stanfill
Go. I was like, okay, so guess what? I, I chose a little boutique hotel. The AC went out. It had no it support. The projector went out, I mean, it, we couldn’t get food. It was hot. I would have paid 15,000. I would have paid much more. I said, but she didn’t have a clue as to why all she did was say, this is the pause. She couldn’t tell me why I should choose the boutique hotel or why should choose the conference center because she hadn’t figured that out.
10:56
Tab Norris
Yeah. I think this is really important because I think it’s, we just changed our whole perspective as salespeople getting EV all of us to change our perspective. It’s other centered, it’s all about serving it. It should make you mad. It should make you mad that sales person didn’t do their job and know really the value of their solution. It hurt.
11:20
Tom Stanfill
It hurt me. I was saying there, why didn’t you tell me? I mean, I called your sales rep for a conference center and I called you to talk to you about it. You didn’t say, I just said, that seems really expensive. And they’re like, yeah, it’s more,
11:35
Tab Norris
I just, it’s crazy. I know, but it really is. This we’re not trying to be pushy. We’re not just trying to shove something down somebody’s throat. We’re saying we needed to know the value of our solution so that we can serve the customers that needed to be served.
11:50
Tom Stanfill
No know, I was working with a software company who was calling customers to renew their software or upgrade to the next version and they’d memorize their script. And, they’d call people and the people would say, no, or they would struggle to sell it. I finally said, why is it in this person’s best interest to upgrade? And they gave me several reasons. Let’s say, that’s great. So now what’s the impact of that. They did a pretty good job of describing that. I said, why isn’t it in their best interest to upgrade?
12:26
Tab Norris
They don’t like that one.
12:28
Tom Stanfill
That was like, I was saying, like there, the sun’s not going to come up.
12:33
Tab Norris
There could never be a reason.
12:34
Tom Stanfill
It’s all the sun will always comes up. Let’s say, I said, they literally couldn’t answer the question. I said, see, you don’t have integrity and you don’t have credibility if you can’t tell people why they shouldn’t pay more. I said, well, what if they were selling their business? Should they upgrade their software? Well, I, I don’t really,
12:53
Tab Norris
I don’t care about that cause.
12:56
Tom Stanfill
I don’t care about that. The good news is when why people should pay more, you find people who need to pay more. When you recognize why people shouldn’t pay more, you don’t waste your time trying to chase down opportunities that don’t exist. There’s a reason why that company developed a $14,000 solution. Yeah. Like in this case, there might be situations where people need the cheap solution. It doesn’t really matter. They’re doing it for some reason that it did. They it’s short term, whatever. There’s a real good reason why people need a $50,000 solution. We gotta figure that out before we can. We effectively do to, you know, respond.
13:29
Tab Norris
That’s really good. Let me, I’m going to kind of summarize this, Tom, basically two requirements before you effectively can respond, right? Number one, discovery first is really important. Making sure that you understand the value of your solution. We used to always say, I used to do this in training years ago. I don’t do it anymore, but I would say, Hey, you guys ever heard this little poem or nursery rhyme or whatever, it’s called. Mary had a little, what did we already have? And everybody says, lamb, it married. Didn’t have a snake. Married, didn’t have a little lizard or anything like that. You didn’t even have to think about it. You just knew it was lamb. I always tell people, that’s the way you need to understand the value of your solution. It has to be that ingrained in who you are that you don’t even have to think about it.
14:15
Tab Norris
Like it’s just, it comes out of you.
14:18
Tom Stanfill
That’s where you speak with confidence because the confidence comes from knowledge. I know that if you, if you go to that boutique hotel, here’s what I know. If you have an it problem, you will have nobody. Who’s going to be a guy that does a little janitorial stuff. Does the trash, does the laundry? He’s the guy that’s going to do it. That’s what I know versus here. Now, if that, if you don’t need it support or AC or food, you should go to the boutique hotel.
14:47
Tab Norris
You got to go have a little chat. Box.
14:54
Tom Stanfill
Chicken boutique tab, a wanting to share, too, that I got this, a recent study that gong did, which is an AI tool, which records, records, calls and kind of tracks, literally comes from tracking 500,000 calls. Okay? So, it can track high performers and low performers and prepare what the high performers are doing on calls and what the low performers are doing on calls, the high performers. They’re three times more successful when they address the value of their solution and talk price 40 plus minutes into the call.
15:33
Tab Norris
So discovery.
15:34
Tom Stanfill
First, then the people that answer the price question, the beginning of the call. There’s not only just, it’s not just a rational approach. It actually works. It’s like, if you wait longer, the call, you develop a relationship, determines, influence, and you have the information that you need to respond because what’s important to them. Yeah. And you also just don’t sound arrogant.
15:58
Tab Norris
Yeah. I love it. All right. So that’s, those are requirements required. So give us the steps. Give us the first step.
16:04
Tom Stanfill
What’s the first step is you need to determine why they’re asking for a lower price. There’s actually four reasons. I am yours, a different strategy for each reason. One of the reasons is they just think they’re supposed to ask.
16:20
Tab Norris
I was trained that way. I will always ask until I die.
16:23
Tom Stanfill
I mean,
16:24
Tab Norris
It’s so true.
16:26
Tom Stanfill
I’ve always asked, I don’t care where we are. Well, you guys offering a deal on that.
16:32
Tab Norris
Allows.
16:32
Tom Stanfill
Us to negotiate. And, and I, I remember I was at a situation. We had worked with a client, gosh, this is 20 years ago. Tab. We worked with a client, did a major initiative with them and it was a super successful and everybody loved it. And the licensing came up for renewal. Like really contract comes up for renewal and the purchasing person calls me and she says, and you could tell you, and this is the thing when people are asking for a discount, but they don’t really mean it. You can, if you pay attention, you can kind of hear it in their voice or their body language and how they answer it, ask the question. She’s like, so we’d like to do, we’d like to renew our contract. We’re considering new in our contact, but we’d like a discount. I go, why. It’s like, so, and so here’s the strategy you want to talk about flip the script.
17:25
Tom Stanfill
We want to flip the script here and have them sell you on why they want a discount. Yeah. Because and be, and I like to be, can kind of confused saying, so explain it to me. We delivered the solution that you asked us to deliver. You had tremendous results from that solution. Everybody loves it. You fully adopted it. Why would you throw it out, start over and then ask for a discount when we’ve been able to hit all the objectives. She couldn’t explain it to me.
17:56
Tab Norris
I’m just supposed to do it. That’s how she gets her bonus. Yeah. I mean, I have learned that a lot of these people or whatever, if they can get you to come off of a number, they get up, they get spiffed on that or they make money on that. They’re going to try to work you as best they can. The bigger the deal, the more that goes on.
18:12
Tom Stanfill
Yeah. You’ve got to, when they ask for price, you need to ask the question, tell me why are you asking? You got to peel the onion. We’ve got to ask them some clarifying questions to get to the why you’re asking that. If we do that well, we’ll realize in the first category, the reason they’re asking is it just, they’re just, I’m in purchasing and I’m supposed to negotiate. Yeah. Right. It’s really, that based on how well they make their argument. If you stay confused, like why are you asking? They won’t have a very good argument and then you’ll know that. Okay. They’re just, they’re just the second person though, likes to negotiate. The second reason people are asking is cause they liked to win.
18:57
Tab Norris
Yeah.
18:58
Tom Stanfill
Now this is somebody who just loves to negotiate. I’m not that guy. I don’t really like to negotiate. If I.
19:04
Tab Norris
Suggest.
19:07
Tom Stanfill
Our project,
19:07
Tab Norris
A friend Jackson, it’s like, oh, I got it. Got to tell them, can I tell this story? This would be great. This is Jackson’s story. It just hit me. This, this sums up somebody who’s like this. We were at in college and we’re at a sporting goods store and I’m getting a ski jacket to go snow skiing. I get the jacket and I’m checking out. It’s the.
19:29
Tom Stanfill
$1.
19:30
Tab Norris
$30. I don’t even know what it was. It was a worst ski jacket ever. We’re leaving and I could care less. When we get up to the thing, we’re checking out and Jackson’s application Ram says, so what do we get for this? Because he’s buying this coat. What is he going to get? She goes, nothing. He got it on sale. And he goes, well, that’s not accepted. We can go get this coat a lot of different places. And we may just do that. How about, how about some socks? How about you just throw in a pair of socks and the lady’s like, no, I’m not throwing in a pair of socks. He goes, are we going to have to go get these jacket somewhere else? Something you got to have something back there.
20:06
Tom Stanfill
The goat jacket,
20:09
Tab Norris
I’m buying the jacket. He’s not even buying the JAG. Finally.
20:14
Tom Stanfill
He.
20:14
Tab Norris
Goes, how about one of these softballs? They had the yellow and she goes, take the softball. Okay. So we’d go to this week. We’d go to the guard and he’s just beside then he got a yellow softball. I said,
20:33
Tom Stanfill
Oh.
20:33
Tab Norris
My God. But I’ll always remember that yellow. So anyway, I’m sorry. I had to tell it.
20:38
Tom Stanfill
That’s a funny story. That’s so perfect of that person. He doesn’t care about the softball. All of a sudden, he, it was him against the lady. I think it was, he said it was a lady and he wants something. He’s going to leave there with something. And so, Hey, this is the takeaway. Figure out your softball before you negotiate, you got to figure it. For the person who you can tell, just wants to negotiate. They, they kind of have a, a win, lose mentality, and don’t be intimidated by them. Give them, figure out what your softball is.
21:16
Tab Norris
There’s gotta be a softball line, right? Those soft balls, throw them away. They had decided the socks. They had good margin on, but not that,
21:24
Tom Stanfill
But what can you give them?
21:26
Tab Norris
That’s really good.
21:27
Tom Stanfill
Yeah. That was perfect. So figure out your softball.
21:31
Tab Norris
Step one is determining why first should always, are they just a person that always asks?
21:37
Tom Stanfill
I just ask and they don’t really care. They’re not, they’re not in there. Hey, can we have it? It’s like, I might’ve been, I might’ve had a joke and I have said, Hey, can we get something to go jacket? And she says, no, I go, okay. Versus Jackson says, what about this? And you’re like.
21:54
Tab Norris
The wind category. Okay. Third,
21:57
Tom Stanfill
The third is, see the value. They do see the value. No, no, Tom. I’m with you. I see that. We need to pay $50,000. Not 14, but I got to get funding. I got to sell it internally. I got a problem. So your strategy there is to partner.
22:16
Tab Norris
Yeah. I’ve had that one that didn’t happen that long ago.
22:19
Tom Stanfill
Your strategy there is. Okay. So here’s the mistake. Everybody makes tab. When, when they realize that they’re not talking to the decision maker, they moved. They try to move past them. Yeah. Right. They try like, okay. It’s like, you were tied to somebody at a party that’s talking to you, but they’re looking past you to see who else they want to talk to or where the food is. You’re like, yeah, not really. You know? You don’t feel drawn to that person for obviously it hurts the relationship. What we want to do is stop and sell the evaluator. First, don’t go past the evaluator, make sure that you and that person, or on the same page and that they are going to be an advocate for you. And so win them over. Love the one you’re with what’s that song. Crosby still love the one you’re with.
23:04
Tab Norris
Maybe we should add some music.
23:06
Tom Stanfill
We should have some background. So sell them. Then, well, the way I think the best way to get the decision maker into the, into pulling them into the process is to know what your process is and lead that process. If you have a very defined process for establishing the value of your solution, like you go through assessment of the, what their gaps are, and what’s in meet with the other people that are part of the other stakeholders and then deliver your recommendation. You want to be able to articulate why those steps are critical. Through that process, you’ll draw the decision-makers in because they may not be comfortable. They may not know how to take you to the ultimate decision maker, but if you have the process defined and why those steps are important, that makes it easier for them to go to the other stakeholders.
24:01
Tom Stanfill
If they’re multiple people or just the other stakeholder and say, Hey, this is how this is an interesting partner we’re working with there. They’ve said in order for them to figure out the best way to solve our problem and the value of our solution is to do the following steps. I think it makes sense. And that’s going to involve you know? It helps them bring them in because you don’t want somebody else selling your solution for you.
24:22
Tab Norris
Yeah. Well, if I’ve got an example, because I don’t know if I’m, maybe our listeners have been in this situation too. I thought I was in good shape. Now tell me if this fits. Like I was working with the VP. I thought they were the decision maker. I mean, he, they positioned themselves like they were, it looked all good and everything. And so it worked out great. And, but we get down the road and all of a sudden we run into this big budget issue because after I really figured out what the solution was, and it was much bigger, it was just bigger than what he had budgeted for. I didn’t, he didn’t talk about that. All of a sudden I could just tell it, this is becoming an issue. He said, this is not a deal. And so,
25:05
Tom Stanfill
Okay. Can I make a quick point about that? Because like, it’s really good to stop on that. The, if you’re working with the evaluator, they can’t change the budget.
25:14
Tab Norris
Yes.
25:15
Tom Stanfill
You can change. You can change their beliefs about what’s the right solution, but you can’t change the budget. They don’t have the power, the authority to change the budget. Their job was to go look for the solution that was designed by someone else. Yeah. Their job is being evaluated based on their ability to go find the thing, somebody else. The first thing you got to do is get them to see, oh, okay. Ma you, we wanted to buy something for 14, but I now believe that we need something for 50, but if they don’t believe that, yeah, you can’t then go to the decision-maker. So I love that. You’re bringing that up.
25:51
Tab Norris
Yeah. Cause that’s exactly what happened because we did discovery, went through the whole process. He’s going, my gosh, this is way above what I have budget, but I like it. I said, well, can we go get this money? He goes, well, I said, who can find, find these funds? And he said, well, the president. I said, well, can we meet with him? He goes, I guess I said, we’ll set it up. Let’s the three of us sit down and happens all the time. Let’s sit down. Let’s talk about if it’s worth adding extra 50 K to it. Great. If not, that’s fine too. It sounds like you want to do it. Let’s just do it. We get to the meeting, Tom. We started talking and it gets all, he gets the valuator. So I was getting really uncomfortable. Cause we started getting into this stuff and I’m telling him, you got to do it.
26:30
Tab Norris
He kind of goes, well, John, or whatever that president’s name was. He said, this is well above the scope that, we have budget and laid out in this thing. He said, so you think we should maybe to save $50,000, we should kind of not that and really not do the whole plan. That tab just laid out. That’s really going to show how it was going to drive the change that we want to get. He goes, that’s ridiculous. Of course we’ll find a $50,000. I mean, it was like his as if it was a quarter and it just instantly evaporated. It’s exactly what you’re talking about, but I did have to win over the evaluator first, before I could get that meeting.
27:06
Tom Stanfill
Evaluators, not going to allow you into the kingdom, it’s going to make them look bad. There’s only one reason to evaluate or allow it, that escorts you in to the, to meet the right people. It’s because it’s going to make them look good. You’ve got to spend time with them to get them on board, get them comfortable, get them aligned with you on what, what, align on the same, recommend on the same recommendation. When that happens, then they’ll walk you. They’re still gonna be a little nervous,
27:34
Tab Norris
A little nervous,
27:35
Tom Stanfill
Ultimately they’re saying this is going to make me look good.
27:39
Tab Norris
Yeah.
27:40
Tom Stanfill
This is going to help me in my career. I’m doing, I’m helping the company by bringing in an alternative idea to the decision maker, but you don’t want somebody else to sell your solution. The thing that you talked about there, I think that’s helpful is if you get the evaluator to describe the process that they’re going to walk through, that will help reveal to you. Who’s involved. Tell me, so let’s just, and I always like to kind of do the magic one strategy. I’ll say, look, if you just, let’s just assume we may have, we waved a magic wand and you decided, oh, this is the best possible solution. And you know, it’s what you need. I’m not saying that’s how you feel, but let’s just assume that you go, yeah, this is exactly you Azlan offers or XYZ company offers exactly what I need and I’m willing.
28:33
Tom Stanfill
I, and I, I believe the value is this what would have to happen?
28:37
Tab Norris
Yeah. That’s a great way what would.
28:38
Tom Stanfill
Have to happen now? He says, well, I’d have to do this and I’d have to do that. And I have to do this. And then you believe it. I’m not saying you do, but you believe, oh yeah. Now you’ve got a plan to work together to then go make that happen. You back up and say, so the first step is for you to make sure that’s actually true. The next thing we’re going to do is we’ll go through that process to make sure we help you partner PR partner with you to make sure that everybody else sees the value.
29:06
Tab Norris
That’s really good. That’s a much better way to do it. Cause the way I did it, I got lucky .
29:12
Tom Stanfill
Yeah.
29:12
Tab Norris
Well, much better to set it up. I like how you’re saying that it’s much better to set it up in the beginning. The more you can do that. I think the more effective.
29:20
Tom Stanfill
Now, the only reason you wouldn’t do that is because, the evaluator is against you.
29:25
Tab Norris
Yeah. Well, yeah. That’s.
29:26
Tom Stanfill
True. Evaluators. Like you can tell they’re in bed with somebody else there or go to the competitors, the brother-in-law, the predators, whatever. And that’s just not gonna happen. You got to risk going around them.
29:41
Tab Norris
That I can say that. All right. So we’ve got all right. This has got to determine why, right?
29:46
Tom Stanfill
The leather fourth, the fourth reason why is really the purpose of this podcast is they don’t see the value. They really don’t see the value. Right? The strategy here is to identify the value gap. Okay. Other words. The working example that we have is pretty clear. You know, there’s a $14,000. Maybe we should make it 15 because in the mass release.
30:11
Tab Norris
14 really throws me off.
30:13
Tom Stanfill
It just happened to be the story, but let’s say 15,000. So we’re 35. There’s a value gap of 35,000. I didn’t think that we can’t just bridge the 35. We need to show why it’s worth probably a hundred.
30:23
Tab Norris
Yeah.
30:24
Tom Stanfill
Right. We can’t just say, yeah, it’s exactly 35 books. At least what we need to do is specifically identify the value gap. What is it that we’ve got to make up? And so, yeah. I, I, so that would sound something like, yeah, we looked at your competitor and it seems to do the same thing. It costs 15,000 and yours costs 50.
30:52
Tab Norris
So it’s a refrigerator. It keeps the, it keeps the cold.
30:56
Tom Stanfill
$5,000. It keeps your food cold. This refrigerator cost a thousand dollars and it keeps your food cold. Like.
31:06
Tab Norris
God.
31:09
Tom Stanfill
By the way, a real objection is when they want to know the answer.
31:13
Tab Norris
Yeah.
31:13
Tom Stanfill
Like they’re asking you, they’re not playing games. Like in the other situations, it’s there’s of gamesmanship there. Like maybe they act like the decision maker, but they’re not. Or they’re, it’s like, they’re negotiating. This is the person that says, Hey, they don’t keep your food cold. Why should I pay?
31:31
Tab Norris
Right. Which is you want, you’re dying for that. You hope that you get to that.
31:35
Tom Stanfill
I want that conversation. You want that conversation. Right. Now that really leads us to step two is where we need to now start. Now we need to respond. So we.
31:45
Tab Norris
Validated,
31:46
Tom Stanfill
Right. Well, we need to respond, but here’s the first thing we did when we respond. This is where a lot of people get off the rails. Right? The, they think the next thing you need to do is talk about your solution. That is not the next thing you need to do. The next thing you need to do is validate their point of view. You need to be able to say to them, look, I want to demonstrate it. Not don’t look at it as though they just teed it up for me to make my presentation. You need to now demonstrate to them that you really get it. Yeah. You’re currently in this process of doing this, your business is at this stage, you care about this. This is what you want. You’re thinking why in the world would I pay $35,000 more for something that’s exactly the same.
32:27
Tom Stanfill
You want them to say exactly.
32:30
Tab Norris
Got it.
32:31
Tom Stanfill
Exactly. Because what you’re looking for there is you’re looking to create receptivity and build the relationship again to your, what the message is you’re going to deliver in the last step. And step three. The second thing I would say to that is you also need to demonstrate that you respect their position and that you really don’t know them that well. I like to say things like, and what? It may not make sense to pay more.
33:00
Tab Norris
So drop the rope.
33:01
Tom Stanfill
And what we call, drop the rope. Don’t try to pull them to paying more. Don’t try to pull them to your position, drop the rope. I like to say, you know what? You may not need to upgrade software.
33:10
Tab Norris
Yeah.
33:11
Tom Stanfill
There’s companies, there’s people that I work with. I love to say that. I love to like, yeah, you may not need to. This is only, you may not. You may be to stay in the boutique hotel.
33:20
Tab Norris
Yeah.
33:20
Tom Stanfill
You may not need to stay in our conference center and instead of them going, yeah, you’re right. They actually moved towards you instead of away from you. You are drawing them and getting them excited about now, they’re going to ask you ultimately, why should I pay more? That’s the last, anything tab you want to add to the validate? Cause I know you’re super good at that. Well, I mean, I remember if Tom, you talked about the licensing, you gave me an example of a time where you drop the rope and I thought it was just beautiful example of how you drop the rope when somebody gives you a price. Objection.
33:54
Tab Norris
Yeah. That was a, a large healthcare company. We’ve gone through the whole process where we’re kind of wrapping it up. It said, checked all the boxes and we’re wrapping it up. Everything we’re all good and safe. So, the way we price is we have our, we have a daily rate and then we also have a licensing intellectual property, which is very important, but it’s, it’s just like, if you buy, some software, it may cost 5 cents to make it, but there’s, you’re paying $350 for it because it’s all the intellectual property. We go through the whole thing and the lady goes, okay, everything looks great. We’re ready to go. Except for this licensing here, this intellectual property piece. Just take that off. If you just take that out, then we are good to go. I said, totally not a problem. All we’ll have to do, I’ll go ahead and get that out of the contract.
34:43
Tab Norris
So we’ll get that all handled. All I’ll need to do is we need to think through this . Cause I’ll just, if you could just let me know the program that you would like us to teach to your team. If you could get that over to me, then I’ll have to take that and then I’ll have to kind of go and certify our team on that program. She goes, well, we don’t have a program. That’s why we’re talking to you. I said, then we probably ought to leave that line item in that.
35:06
Tom Stanfill
Contract.
35:11
Tab Norris
I said, yeah, that’s what that is. It’s the 20 years that we spent building a program so that we can take this and deliver it to your people. That’s the real value of this whole thing. She’s like, all right, we’ll get this thing signed and over to you right now know she’s right. She had the,
35:28
Tom Stanfill
If you have a program or you just need us to train them on, product information or something, that’s not been proprietary us. It doesn’t require any R and D and all the time and effort energy. And there’s no value for it. Lee, I’m open to doing that. Well, we don’t have that. Yep. Oh, well, so at that moment that said sincerely, and I think that’s the key. You need to really have somebody in your mind that needs it in somebody in your mind that doesn’t need it. Cause then if you could describe both those situation, you’re sincerely dropping the rope. Again, when you do that, sincerely, you are drawing people to ultimately addressing the value gap.
36:05
Tab Norris
Yeah, that’s good.
36:07
Tom Stanfill
The last step tab, we’re almost at the final,
36:11
Tab Norris
What.
36:11
Tom Stanfill
Everybody’s been waiting for. Step three. Step one, determine why step two, validate their point of view. Don’t jump, rush to your, delivering your message, validate their point of view until they say exactly, which also includes drop the rope. Then lastly bridge the value gap. There’s two things that bridge the value gap one. There’s the message and there’s delivery. Okay. They’re both equally important, but let’s talk message first. Okay. We want to deliver a message that communicates an ROI or a cost benefit. In other words, you can do both. That’s great. In other words, you spend this money, you don’t save any money. You’re going to get more money or it actually doesn’t cost you what you think it costs you. It actually will cost you less. It’s either a saving you money or it’s making you money, but there’s some financial benefit. Now there could be emotional benefit too, but that one’s a little, that’s usually more, it’s more communicated in it’s what’s, it’s kind of intuitive to them.
37:16
Tom Stanfill
It’s like the way you’re talking about it. Like it’s a, hopefully it may be something about one of their decision drivers could be, Hey, it’s, it’s redundant, it’s like, it’ll never break down and you’ll never have to spend time over on the weekend because the system always run. So that’s.
37:34
Tab Norris
Still got cost benefit.
37:35
Tom Stanfill
To it, but it’s still got a cost benefit, but you’re not going to say, and you’re going to spend time with your family.
37:40
Tab Norris
You’re right. Yeah. Just think you’re going to think of the stress level is going to come down. We’re going to go.
37:45
Tom Stanfill
Drink.
37:46
Tab Norris
You’re going to do more yoga.
37:47
Tom Stanfill
Yeah. Like, if stress is a great example, like stress is this issue like they’re overwhelmed or they really want a career, they’re looking for advancement in their career. You don’t want to say things like, and you’re going to get a promotion. The people I work with 50% got a promotion you’re not going to, but you’re going to say things that deliver that message. Ultimately you’re going to send her around. I know this is obvious to most people, but this is where we have to figure out a way to de to come up with some ROI that bridges the gap. Like what’s the, if I’m going to spend $35,000 more, what am I going to get? Right. What I’m going to get. It kind of going back to the licensing thing to have, I like to tell that in a story. Yeah. In part of this, again is the prepare.
38:34
Tom Stanfill
But, but cause you’re not going to develop this on the fly, but to tell a story, like I had the situation with a large, it manufacturer like seven years ago, we’ve been in business about 20 years and I had the same question about licensing. They were like, well, they really were struggling with like, well, we’re thinking about developing the program ourselves versus paying for licensing. We like your training and our people, but we don’t know if we want to pay for program. And I said, so yeah. Well, well let me, let’s talk through that. I said, and in 1996, which is 20 years ago, I spent about 120 hours, I think, no, actually not a hundred twenty two hundred fifty days. Sorry I got to do 250 days developing the program. Right. Because you and I, I calculated this.
39:19
Tab Norris
Lots of times.
39:21
Tom Stanfill
It was about the time that us together, we spent, developing the program. I said, we deliver the first program. There was really no ROI. It really wasn’t that great. And we didn’t really have tools. And the content really wasn’t that clear. And were entertaining, We spent 250 days at our first attempt and had never been tested. It was okay, but the outcome was poor. I said, very fast forward, 20 years, I we’ve now spent 7,200 days. We’ve tested the program and hundreds of organizations, thousands of sales reps to 20 plus country, I can demonstrate ROI, this level of ROI results. And I have all of these tools. I said, so if you don’t pay and I’ve got four trademarks because it works. You’re where I was in 1996. And where are we? So, and obviously I didn’t say that in a way that would be offensive, but I said, back to dropping the rope, if you don’t need an ROI and you’re not really care about the return on investment and the results, then maybe you needed to develop.
40:35
Tom Stanfill
And if you’ve got the time, right. It was, but it was telling a story that was able to communicate why we felt that it made sense for them to pay more.
40:46
Tab Norris
I love it. Perfect example. You, so message kind of making sure you got the right message, right? You got to have a return on investment. You have to have some amount of cost benefit analysis. And what else?
41:01
Tom Stanfill
The other thing is delivery. This is something that gong also study, which I thought was fascinating is that when people pause after they deliver price, the high-performers pause. I think they were twice as effective.
41:18
Tab Norris
Oh, the old paws.
41:19
Tom Stanfill
Or in other words, they’re not, it’s not that they it’s a technique. It’s just, they’re competent. People say what’s the price, $50,000. Well, we could, we, but we could, we probably can negotiate that. It’s like it because people believe what you believe. If you’re confident and you deliver the price with fewer words and you pause, people will believe it and pay more. So there’s a delivery there. I think it’s just important is that we need to believe, and this goes back to prepare. We need to state it with confidence. Like if you call it a grip and you were thinking about going to a reservation rep, you think about going to four seasons, which is one of the nicest hotels in the country. You’re wanting to go to Maui and the four seasons in Maui, they said, how will you say, how much is it?
42:07
Tom Stanfill
They wouldn’t go. Yeah, well, it’s kind of expensive. It’s, it’s like $500 a night and it’s like, no, they would go, if you want to stay at the nicest hotel in Maui or on the big island, it cost a thousand dollars a night. They have no problem because they believe the value. And I think.
42:25
Tab Norris
They know it.
42:26
Tom Stanfill
If you, but if you called the Marriott courtyard.
42:31
Tab Norris
And he.
42:31
Tom Stanfill
Said, he said it’s $700 a night. They were like, well, maybe I could get you a discount.
42:39
Tab Norris
Yeah. I can finally not 25% off that,
42:42
Tom Stanfill
By the way, I always say it is, you should tell at six state the price of your solution. Like you’re telling time, what time is it? Yeah, it’s 3 56.
42:52
Tab Norris
That’s just, it is what it is.
42:53
Tom Stanfill
It’s just, it’s the price of,
42:54
Tab Norris
I understand the value of it and I’m confident in it. And you should be too. You should be really feel really good about this.
43:01
Tom Stanfill
If you don’t, then you need to go back to the requirements and figure out who either you skipped discovery or you’re not sold and you need to get sold. You need to do your own analysis and feel competent. Don’t listen to what management is telling you. Right? You gotta now listen to them in, but don’t just accept it without investigation. Now if you accept what they say and you go, that makes sense of it. You believe it. And you don’t need further investigation. Fine. If you’re just saying it, because they told you to say it’s going to break down.
43:36
Tab Norris
Yeah. That’s good. All right. Why don’t we do this? Can you kind of wrap us up? Can you pull it all together for that?
43:42
Tom Stanfill
Pull it all together? Yeah. So big, big topic, right? How do we defend the value of our solution? How do we respond to the price? Objection to requirements. You’ve got to go through discovery first to figure out what’s important. What do they want? What’s at stake here. What other decision drivers? Not just their formal, but informal decision drivers. What’s the value of your solution. You’ve got to know that who should pay more and who shouldn’t. We got to the three steps, determine why they’re negotiating because there’s only one of the four is because they think it’s not worth it. We need to validate their point of view so that they’re receptive to our response. We need to bridge the value gap. We need to come up with a message that we can deliver the demonstrates, why they should pay more, either ROI or cost or both, and then how we need to deliver it with confidence.
44:34
Tab Norris
Love it. Awesome. Good stuff Tommy.
44:37
Tom Stanfill
Beautiful. Well, thanks everybody for joining us for another episode of SALES with ASLAN. If you find that it’s helpful Tab, let’s encourage people to give us comments Tab, or we want it to have, we need to currently do encouragement plus tell your friends, plus it helps other people find us. If you find it benefits you, give us some comments and rate the podcast, it helps other people find it. So thanks for joining us. And we’ll see you next week, on another episode of SALES with ASLAN.
