As a consumer, have you ever had someone selling you something, such as windows, stereos, or cars, and first tell you a very high price, then later tell you a new, lower price for the same thing? That salesperson may have been using an old-school tactic called “price conditioning”. As a sales tactic, price conditioning is intended to make us feel better about a lesser price, even though it may be higher than we initially thought we wanted to spend.
When price conditioning is done to manipulate the customer, most people see through it, resulting in a lost sale. However, price conditioning is a very useful sales tool if it is done with integrity.
For example, your customer asks, “How much are new heating and cooling systems?”
Your reply with a price conditioning comparison, “Well, that depends on what is most important to you. Some customers are at the point where they have had several systems in their lifetime and know they want the most comfortable, quietest, healthiest, most efficient, and most reliable system. They might choose to invest twenty thousand or more. For other customers there are good, reliable, basic systems for ten thousand or less.”
In this example you have provided truthful information without any intention to manipulate your customer’s thinking. You have established “twenty thousand or more” as a potential investment amount. When hearing this number, from someone who can be trusted, it “gives the customer permission” to consider that amount money as more reasonable.
In our industry it used to be a common practice to offer a single “choice” and hope the customer would accept it. In fact, some did. If not, the salesperson would have reminded the customer what they might sacrifice if they didn’t include any upgrades or add-ons. Some customers viewed this tactic as pushy, but it was often effective, and the resulting selling success encouraged salespeople to use this technique.
Over time, the internet provided consumers with access to much more information about what they were buying. Marketing powerhouses like Amazon added seemingly unlimited choices. I’ve noticed that Amazon has continued to evolve its original choices model to include much more information, including specifications and video instruction. For many of us, shopping at Amazon is our first and only choice.
In addition, and perhaps most significant, there is the psychology behind giving choices. When offered a single system, the only answer is yes and no. When offered choices, it’s highly likely that your customer will be thinking about which one to pick.
The Power in Blending Price Conditioning and Choices
So, let’s put these two proven selling tactics together. Please remember the TRUST® tenant: Our commitment to serve our customers without judging what they will or won’t want or can or can’t afford.
How to Prepare your Choices:
- Four choices are proven to be the most effective.
- The choices are based on your initial discovery questions and the additional problem discoveries you made as you surveyed the house with the customer.
- Your best choice does not have a budget in mind. It includes everything that could take care of the customer’s interests and problems.
- Show the lowest monthly payment for each choice first.
- Show the total investment underneath the monthly payment.
- Your minimum, basic choice will address the customer’s basic needs.
- Then there are two choices in the middle.
- I suggest you avoid technical jargon or specification data with the choices.
- Example: Silver Bullet Price Page. Ask Andy or Angela to show you the TRUST® Edition.
Presenting the Choices with Price Conditioning at the kitchen table, showing the customer all four choices as you say:
“I’ve prepared four choices for you. They are based on what you told me you were interested in and what we discovered as we surveyed your home. The first choice doesn’t have a budget in mind. It includes everything that we could possibly do without cutting any corners. The basic choice is the minimum system that we could provide that would fundamentally address your concerns. Then there are two in the middle. Please keep in mind that we can mix-and-match among these choices to fit a budget that you would be comfortable with. You can see what each of the investments are. Would it be OK if I start with the best system first?
Properly done, price conditioning with four choices happens instantly.
Properly done, you will never be perceived as “the pushy salesperson”.
Properly done, you will sell more jobs, for more money, and create happier customers.
Who wouldn’t want that!