How Open Should You Be About Price

One of the things that impressed me the most about the gym I belong to is that their price was posted on the front counter. A lot of the more expensive gyms you walk into guard their prices like they are a state secret. This makes me very uncomfortable.

I remember that there used to be a gym very close to my office. I walked in there one morning and said, "I want to sign up, can you give me the price". The answer: "no, you have to go on a tour of the gym first and them meet with one of our salespeople."

See ya! I never joined and that gym has gone out of business. They lost my sale because they missed out on two key sales points:

1. If somebody is at the peak of their buying emotion (they are ready) - do not make them wait to buy. Sign them up or sell them right then.
2. They refused to answer one of my questions making me distrust them and suspect that they were trying to pull something on me.

Now, I will say that I have been on the flip side of this when doing sales myself. Selling something as complex as advertising, many potential clients would say, "just give me your prices". Of course we would, but the client had no way to interpret them because the prices were completely out of context.

Often they would get one glance at a price sheet and say, "too expensive". The reality is that answer is mostly natural sales resistance, but also the client not understanding what he or she is looking at.

My recommendation is always give the client the information they want, don't come off like a sleazy huckster, and offer up more explanation. Try to have a natural conversation with them - 9.999% of people can smell a pitch a mile away and hate it.

"Can I get your prices?"

"Absolutely, here they are. We have a couple of specials that you might want to hear about as well. What questions do you have about the prices?"

"This is way too expensive."

"I know a lot of people get sticker shock when they first see the price list. Let me explain a little bit about our prices..."

It's important to keep the dialog going. If your prices are higher than your competition - you had better have a compelling reason for it. If you are less expensive than your competition - have those prices handy to show your client that you are lower.

Low prices to some people mean less value. I know it may sound crazy, but you also need to explain lower prices. In tests when people are given three choices of similar products with different prices - most people pick the middle price.

If you ever get a chance to walk around an IKEA take a look at a lot of their signage which explains how they keep their prices so low. They buy in bulk, use self-service, and ship everything in flat boxes for example. IKEA has successfully built a reputation for very low price, high quality, and incredibly useful stuff for the home.

Always try to see things from your customer's perspective. Would you trust a huckster that wouldn't give you their prices?

J D Moore - Marketing Comet