Why Showing Your Prices Will Generally Increase Sales
One of the first questions that anyone will have about your product is how much does it cost. My argument is that in most cases answering that question early is a good thing for sales.
I have heard (and don’t ask me where – probably in my car selling days) that price is about one third of the buying decision. I agree. I think people start with 3 basic questions and if any of these result in too resounding a NO then the prospect is off to another product/vendor with little chance of a rescue.
1. Does the object look like a solution for my problem? – this is a broad question based on the preconceived idea that lives in people’s heads. To keep the car theme: when people start looking for a first car they generally have an idea in their heads, it is the dream. To many young girls it was (and probably still is) a sporty looking automatic in red. The dream may also have a specific shape attached like a “Toyota Celica”, “Mitubishi Lancer” or even “Hyundai Excel”. If the car they are being shown does not match the dream the buyer will shake their head and walk away. Many people don’t want to acknowledge the dream they carry. That is a shame as it would make it easier for them to find “the one”. If asked, the person will say they have no idea what their dream is. Most people don’t want to let on simply because they are afraid of falling in love too easily. Sad. Selling against the dream is hard but not impossible. Sometimes familiarity (a test drive and lots of talking) will allow someone to transfer their dreams to a different shape so long as the offered solution is genuinely better than anything else they can find. In reality this is selling to the core of the dream and not the shape that overlays it.
2. What does it do (or what are the features)? – too often sales processes gloss over the real features of a product. There may be lists but they don’t explain what the product can do to solve real situations. The 2nd question is really the point of beginning to ground the dream in reality. You could rephrase the question as “how does this thing fit my dream?” I would always rather find out what my customer wants (this always points to the dream if not fully exposing it) and then show features that match the wants and needs. I hated pointless 6-position selling where I had to drag the prospect around the car showing them a pile of things they didn’t care about. If they were a Street Racer I showed engine, suspension and then stereo. The boot/hatch area was solely for sub-woofers, never groceries. I would talk of modifications my other customers had made and what worked and what didn’t. I filled the dream before I let anyone drive the car. Doing anything else tended to waste time and result in either burning up scarce profit in negative negotiations or worse losing the customer to an inferior competing car that cost more than mine
3. What will it cost me? – there is no point in making, or letting, someone fall in love with a Ferrari when they only have $15,000 to spend. Far better to save everyone’s precious time and let the customer find a realistic match for their dream elsewhere. Price is the final grounding in reality for the dream. If people really believe in their dream they will spend to make it happen. If they can’t afford their dream then either their dream needs to be adjusted or you need to let them go because they are not a sale at all. The more positively the customer can answer the first two questions the less they will stress over the price. All genuine customers understand that dreams need to be paid for somehow so I believe hiding from price can only be negative.
I have laid the questions out in this order because I think that this is the order that they get asked in the customer’s mind. However I believe that the order can appear different a lot of the time because either the customer circles around the three questions several (or many) times in the process of a sale or poorly directed customers attempt to focus on only one (usually price).
I firmly believe that displaying price is a must. A thing has a price and to hide it can only be game playing. Customers don’t like to be toyed with. Salesmen hate it even more so why start such a lose lose scenario? If you start playing then it is even harder to stop a misbehaving customer who is only completing what you started.
How you should Show Prices on your Web Site
Unless price is your main competition strategy (and you better think carefully before you do that) then price should not be on your home page. Answer questions 1 & 2 first and then show what has to be traded to fill the dream. Prices should first appear at the page that has an overview of your product range e.g.
Product 1 – 4 wheels, steering, engine, paint $8,990 drive away more info
Product 2 – 4 wheels plus spare, air conditioning, stereo, windows, seats, tow bar $12,990 drive away more info
Then on the actual product page show the price at the Buy/Inquire Now button. Every time the customer clicks to go on they are saying “yes” which is a win win progression. They like what they see and you are developing a happy customer. You can consider removing price at the overview stage but monitor this to be sure that it isn’t costing you sales from confusion. Most customers will look at the more expensive products to see how much better they are for the price. Consider putting in a comparison chart so customers can see quickly which price/feature set suits them best. Remember that customers are looking for a solution to fit their (not your) dream and lifestyle.
A Case Study
I had a client in a small school start-up. I said to them that they should put lesson prices on their web site. They looked at me in horror saying that if they were to do so they would get no calls and competitors would just undercut them. I suggested that if competitors wished to undercut them they already would have and if their prices were fair then they wouldn’t lose anyone genuine. I asked them what the first few questions were that were asked in every phone inquiry and price was common to all.
The guys decided to trial prices on their web site and when I caught up with them a few months later for a launch party the greatest initial skeptic came to me and said that I was spot on about displaying prices. I replied that yes displaying prices may reduce the number of phone calls but those that did call should be better qualified. The other fellow jumped in and said that I didn’t understand, the number of phone calls was up and so were enrollments! Mothers loved that the prices were so great and that money was one less thing to worry about when putting Johnny in a class.
If I haven’t convinced you then put some tests on your un-priced system to see if there is a point where you are losing prospects. Do a lot of people leave your site in the shopping cart (just looking for a price)? Do people call or email looking for the price, or even worse “the best price”? Build a better value proposition and let price be a natural part of answering those three questions and I am confident that when you test again the results will be much better for most (if not all) products.
If you want me to work with your business then please visit BRM Web Consulting
