When Do You Talk Price in a Sales Cycle?
I need some help with a debate our sales team is having: As a sales professional, when do you talk price in a sales cycle?
A little back story
This year we hired our first sales professionals at Ideal Candidate. We currently have the team broken out into sales development reps and account executives. For a quick primer on the difference between these roles check out this excellent Salesloft infographic.
One of our account executives suggested that we don’t talk about price on the first call but instead focus on building value about our solution so when the conversation about price happens, it’s directly linked to the value we bring. This started a (friendly) debate with the two sides summarized below.
The argument for talking about price early
It’s important to qualify a lead as early as possible in the sales cycle so you don’t waste their time or yours. Like it or not, price is a big part of qualification. Yes, if you talk about price on the first or second call with a customer they may get sticker shock, especially if they don’t understand the value that you can bring them. That’s a risk. But what’s more risky? Losing a prospect due to sticker shock or getting 2 weeks and 3 meetings into a sale just to find out that you’re not even close on price?
A good sales professional can talk price early, and manage the sticker shock if it happens. If your prospect is completely turned off by the price, odds are no matter how much value you demonstrate they would never have bought in the first place.
The argument for talking about price later
Steli Efti over at Close.io has a good video above discussing the classic argument for not providing price information straight out of the gate. You need to take the time to understand your potential customer, their budget and needs, and how they will use your product or service. Then, once you’ve collected this information you can demonstrate the value of your product/service and show how it will become an investment rather than a cost for your customer. If you give pricing information on the first call, you may trap yourself into quoting too high or too low.
Agree with him or not, Steli lays down a good argument for holding out to get the best and most accurate pricing information for your customer after you’ve already demonstrated the value of your solution. Curiously enough, Close.io has their pricing on their website, so they handle price long before the first sales call, somewhat counter to his advice.
Where do I sit?
It seems that delaying the price discussion is the popular strategy, but I like talking price early. A suggestion from our advisor Charissa Franklin really nailed how I feel about this topic: Try to build value before talking price, but if a customer asks you point blank “What’s the price?” don’t dodge their question. You risk frustrating your prospect and putting up an information road block which can discourage them.
There are indeed complex purchases where it is literally impossible to provide a price on the first call. However, if you are a SaaS product, with only one product line, and you truly feel there is value in your solution—don’t be afraid to talk price confidently.
What’s worked for you when discussing price in your sales process?
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