If you've worked in sales for even a hot minute, you've probably encountered the seemingly impervious "it's too expensive" objection. Never fear, this blog post is here to help you parse and overcome these objections both smoothly and effectively.

What is a price objection in sales?

Have you ever had a dance-off with a customer over prices? Not a literal one, unless your sales environment is a whole lot more exciting than most of ours. But, a figurative one. You drop the product or service, the customer counters with "that's too high,” you jump back in with a justification of the price, and so it goes, back and forth. Welcome to the battle royale of sales—the price objection.

Price objections pop up when customers believe your product or service is a bit too heavy on the ol' wallet. It's important to remember that it's not always about the actual dollar amount. Instead, it often arises from a lack of understanding–the customer just can't see why your product is worth their hard-earned Dead Presidents, or digital equivalents thereof.

3 proven strategies for overcoming price objections

Your first instinct upon hearing a price objection might be to drop into a defensive stance like a wrestler ready to grapple. Hold on, there, tiger. The key to overcoming price objections isn't brute force; it's finesse. Let's break it down.

Understanding the customer's perspective 

Empathy is your secret weapon here. Put yourself in the customer's shoes. Are they hesitant because they don't see the product's value? Perhaps they're unfamiliar with the market rates for this kind of service. Knowing their unique concerns will help you tailor your responses considerably better.

Demonstrating the value of the product or service

If the customer can't see why your product is worth its price, then put on your magical 'show and tell' hat. Highlight the benefits that directly address their needs or pains. Explain how your product provides long-term value or saves costs in the long run. The aim here is to reframe the conversation from price to value.

Negotiating effectively

Sometimes, the old game of give-and-take comes into play. Though we're not necessarily advocating for slashing your prices at every objection, a little negotiation can be beneficial. Consider flexible payment terms or bundling services to enhance the perceived value.

5 sales scripts for handling price objections 

Nope, we're not handing you a playwright's handbook but providing potential scripts can help you navigate the murky price objection waters more confidently.

Script #1: "I completely understand where you're coming from. Let's break down the value this product/service offers and see if it aligns with your needs."

This script is your classic one-two punch combo. First, you’re acknowledging the customer's perspective (That's the empathy jab!) and immediately following it up with a counter-offer that redirects the conversation from cost to value (Boom! The value uppercut!). The goal is to refocus the discussion on the long-term return they'd be getting from your product or service.

Script #2: "It sounds like budget is a concern for you. Would flexible payment terms help make this more manageable?"

This script shifts the conversation from the total price to flexible payment options. By doing this, you're showing your willingness to work within their financial constraints, allowing them to see the product as more accessible and affordable, thus potentially diffusing the price objection bomb.

Script #3: "That's a fair point, and a lot of our customers felt the same way initially. However, they found that the increased efficiency/productivity/profitability they experienced with our solution quickly justified the investment." 

Here you're playing into the herd mentality by referencing other customers who had similar concerns but were glad they made the investment. This can help reassure your customer they're not alone in this concern and there's a happy ending on the other side of the price objection rainbow.

Script #4: “You've said that [specific product feature] is important to you. While there may be cheaper options out there, they don't provide this particular feature. Wouldn't you agree that the added benefit would be worth the investment?"

This script directly connects the product's value with the customer's needs. By pointing out how your product uniquely addresses their requirement, you're nudging them to reconsider the price in light of the distinctive value it offers.

Script #5: “I see the price is a hiccup for you. Suppose we could demonstrate how our product/service could help you save/cut-down on your costs in the long run, would that make a difference?"

With this script, you're highlighting how your product/service is a strategic investment that will pay dividends down the road. It pushes the customer to think beyond the initial price and consider the potential long-term financial benefits.

How to adapt scripts to different situations

Navigating the spectrum of customer objections is a bit like improv. No two players, or in this case, customers, are the same. The beauty (and the challenge) lies in adapting your performance, or script, to the character standing across from you. So let's delve a little more into adapting scripts for different situations.

Think of your script as a loosely assembled Lego structure. Each situation requires you to rearrange those blocks to fit the specific narrative. This flexibility allows you to respond effectively to various objections, from the blunt "it's too expensive" to the more nuanced, "I need to discuss it with my spouse."

Begin with evaluating the specifics of the objection. Is it based on sticker shock alone or a deeper concern? An "it's too expensive" objection could mean they view your product as a gratuitous luxury rather than a need. Alternatively, the "I need to discuss it with my spouse" could indicate they're not the sole decision-maker, signaling it might be helpful to provide additional collateral they can share.

For instance, when a customer claims your product is simply too expensive, use a script that focuses on the long-term value, cost savings, or unique advantages your product brings. Your script might be something like, "I understand where you're coming from. Let's look at how our product gives you more bang for your buck over the long run."

On the other hand, if the customer mentions needing to garner another's opinion, your script can provide the information necessary for them to sell your product on your behalf. You might respond, "Absolutely, I understand. Let’s go through some key points you can bring up in your discussion."

Understanding your client's pain points also plays a massive role in script adaptation. If they’re in a competitive industry, stressing the advantage your product can give over their rivals might help. For a budget-conscious client, focus on cost-effectiveness or ROI. Your script should respond to their unique challenges and concerns.

Remember, the aim isn't to mechanically recite a script, but to use it as a scaffolding to give structure to your response. Adaptation is about personalizing and tailoring your script in real-time to suit each customer’s needs. It’s about listening, understanding, and communicating in a way that directly addresses their objections.

It's empathetic improv at its finest: you hear the objection, respond to it, adapt your script, and always, always stay in the moment. Because in sales, as in improv, the magic happens when you're fully present and genuine in your responses. Handling price objections can then become less of a stumbling block and more of a stepping stone to closing a sale. Just remember to read the room, listen to your customer, adjust your Lego blocks, (err… your script), and tackle those objections head-on.

Case study: Overcoming price objections in car sales

If you've ever bought a car, you know it's often a dance between what you want and what you're willing to pay. The sticker price can sometimes feel like a blow to the gut. That's precisely what Carl's Crazy Car Corner (name changed to protect identity) found themselves grappling with—customers who loved their high-quality vehicles but balked at the prices.

Carl, the head honcho of the dealership, noticed that their sales folks were frequently stumbling into the "it's too expensive" objection. Customers were walking out, leaving the sales team frustrated and the dealership's potential profits slipping out the door. We're not talking just a small blip in sales here; it was turning into a trend that could spell serious trouble for Carl's Crazy Car Corner.

Knowing they needed a strategy revamp, Carl enlisted the help of a sales consultant. Together, they dug into the nitty-gritty, taking a deep dive into dozens of sales conversations to understand the recurring patterns. They noticed that while the team was excellent at singing the praises of their cars' features and performance, they stumbled when it came to addressing price objections. It was like watching a well-oiled machine suddenly sputter and stall.

The new plan involved a shift in how the team approached price objections. Instead of shying away from discussing price, the team was trained to pivot the conversation towards the long-term financial benefits of investing in their cars. They began to emphasize elements like the durability of their vehicles, the premium service plans they offered, and the potential for higher resale values due to the excellent quality and maintenance record of their cars.

Simultaneously, they started offering flexible payment plans and attractive warranties, further adding to the perceived value. We're talking about changing the conversation from "It's too expensive" to "It's an investment worth making."

With these new strategies in place, the Carls Crazy Car Corner team noted a drop in the frequency of price objections. They saw customers more willing to discuss options and, importantly, were closing more deals. This change didn't happen overnight, but the persistence paid off, resulting in happier customers, a motivated sales team, and increased profits. 

In essence, by flipping the script and focusing on value over cost, Carl's Crazy Car Corner turned their price objection predicament into a success story. They realized that a price objection isn't a definite roadblock, but a detour signaling the need for a more value-focused conversation. So, the next time a customer throws a "it's too expensive" curveball, remember the journey of Carl's Crazy Car Corner. It's all about demonstrating value, baby!

5 common mistakes to avoid when handling price objections

1. Don't get defensive.
2. Don’t make assumptions about why they’re objecting to the price.
3. Avoid arguing over the price. 
4. Resist the temptation to drop the price immediately.
5. Don't overlook the importance of demonstrating value.

To dodge these pitfalls, keep your cool, stay focused on the customers' needs, and remember, if they walk away, it's not a reflection of your selling skills. Everyone loves a good deal, but the best deal is the one that provides real value.

Training your sales team to handle price objections

Salespeople often fear price objections like garlic to a vampire. However, with effective training, they can learn to handle these objections confidently and seal the deal.

Drill them in the art of empathetic listening, teach them to demonstrate value instead of justifying price, and get them comfortable with negotiation techniques. Plus, practicing common scripts couldn't hurt. Magical is a great sales tool for this reason—you can share your most effective scripts and email templates so everyone on your team can use the same playbook.

Conclusion

Price objections can seem like the Darth Vader of the sales universe. But remember, the force is with you. Armed with empathy, focused on demonstrating the value, and equipped with negotiation techniques, you'll master handling price objections in no time. So the next time someone objects, remember it's not all about the money. Show them the value, grasshopper, and they'll show you the money.