How to Have Better Pricing Discussions
During pricing calls How do you convince your prospect that your price is the right one?
You could tell them why your product is better than the alternatives...
Unfortunately, that is only going to get you only so far.
There are two methods to improve the quality of your pricing calls in a B2B SaaS environment that has there are both Sales Development Representatives (SDR) as well as Account Executives (AE) are involved in the sales cycle. Let's get to it...
Value Coaching
Price negotiations will surely fail if there is the need to differentiate between what you and your prospects view as value. While it's tempting (and actually more adaptable) to repeat the same company-wide values and talk points, it's likely to cause a disconnect between your and your potential customer. Sometimes it's simply semantics but it's important to understand your prospect's business. It is then possible to design your product or service in terms of what is valuable to their business.
This is the process I refer to as the value of coaching. This is a complex concept, but it starts by listening and understanding instead of talking. There are two methods to begin understanding what your prospects perceive as value:
1) A successful discovery process that is accompanied by a continuous conversation.
Try asking your prospect the following inquiries:
- The sales staff you spoke to uses (TOOL X). Which component of this solution is used most by your staff? What are you doing to address this problem today? Do you use any tools and are you responsible for the issue?
Consider this quote from Scott Sambucci, Founder of SalesQualia:
"Price is a benchmark for the value that customers perceive to be worth. If customers aren't satisfied with price, they are telling you that you have not yet expressed the value necessary to justify the expenditure ."
Sales reps are often unable to comprehend their customer's stack, and they often make statements too early. Asking these probing questions about how the prospect perceives the value of their current stack can help you discover how your product fits into it and then communicate that value to them.
Before entering prices be sure to determine what similar software tools the company uses. After that, you'll be able to shift your discovery around what benefits these tools can provide to their users and then address the space between.
Your prospect might see value in how long they spend using a product. The team they work with uses HubSpot for up to 5 hours every each day, making it a great investment for their company.
If your product isn't one that demands the user spend all day within it It is important to communicate to them why it brings benefits even though they may not use it for a long time.
Be aware that if you set the price too early the risk is that customers will be hesitant at the price. Find out what they value and discover an opportunity to connect with the business's challenges and ways they will perceive value (in other words, warm the salesperson a little). The best answers in sales are yes or no. If there's an inordinate amount of difference between the perceptions of value, it's both your and your prospects best interest to walk away from the deal before expending excessive resources.
2.) Leverage tools that give you insights into how people interact with your site.
It is difficult to make a good discovery as most prospects are eagerly trying to see a demo or get to the cost point. There are tools and strategies that you can employ to discover what is appealing to the prospects.
- Uberflip: create personalized content experiences for your prospects. Their analytics tool provides insight into which pieces of content your prospects are engaging.
The two methods listed above will help the prospects you train on value rather than assuming what they would like and offering the wrong solution.
Single Option Alternative
The second suggestion for making efficient pricing calls is to rely on the psychological concept of one-option aversion.
Behavioural scientist Daniel Mochon posits that customers are more likely to make a purchase if they are presented with multiple choices. He conducted an experiment where buyers were shown two brands of players for DVD. 32% indicated they would buy the first brand while 34% selected the second. However, when participants were presented with a single DVD player, just 9% (or 10% (depending on which type of brand they were shown) indicated they'd buy the product. This represents a 66 percent increase in sales by simply adding a second option for the buyer.
Despite selling B2B SaaS however, the human brain is able to approach almost every purchase decision this way.
This effect only increases when you are in B2B SaaS environments.
We researched the leading SaaS companies and found that over 65% had a consumer-facing multi-tiered pricing page with a contact-us/enterprise tier without a price.
Most companies will ensure that whenever a user fills out the "contact us' form that prospect's details are passed on to an SDR for the purpose of discovery, and finally to an AE for a deeper exploration, demonstration, and pricing. Prospects have come to love auto-service solutions as they have the ability the option of choosing a solution that suits their needs quickly and then purchase and deploy the solution.
When they first see your pricing page on your website to the price proposal, customers have the option of choosing and options. At the conclusion of the procedure, they're provided with just one option and price to buy the service.
I'd suggest replicating the self-service purchase experience for prospective customers while keeping the price hidden. This way you can frame your conversation as "These are a few different packages that suit our various customers, is there a particular tier or set of features/functionalities that resonates with your needs?"
From there you can leverage the power of's price guides to focus to the specific solution that the prospect wants.
When you know where your most interested is through your first discussion, you are able to create and price out 2-3 customized levels to meet their requirements. These come with the benefit of higher-level knowledge as well as the science-based principles behind single-option aversion.
Interactive Quotes can be used to create an entirely custom-designed guideline for each new prospect, ensuring they are met with the best possible options in terms of price and options.
It is also possible to incorporate Drift right in your price guides. Prospects can also ask inquiries while reading the price guide rather than having to send you an email. This can speed up the procedure. This allows you to modify the guide in a flash and brings you a step more close to closing the sale.
The Wrapping up
Pricing calls can be difficult and awkward. For building trust with your customers, speed up your sales cycle and ensure you are making more effective pricing calls
- Reframe your discovery process by value coaching rather than presuming what your potential clients perceive as worth
- Utilize single-option aversions and self-service pricing methods to benefit your business
