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4 Simple Steps to Escape the Price-Driven Sale

Price matching is killing you. That’s right, I said it. When contractors compete on price and throw out low-ball offers just to get the business, they’re actually killing their business.

That was one big take-away I came home with from a conference where I listened to John DeRosa, Jr., Sales Manager at IKO Roofing Contractors. A wise man, he argued, and I would tend to agree, that most contractors compete on price, in some way, shape, or form.

When it comes down to it, you, Mr. Contractor, do not want to lose a sale and will match a competitors’ price, no matter how low you have to go. Even though your poor margins are screaming and begging for mercy, you have bills due and payroll to make.  So you take the low-ball offer.

But it doesn’t have to be like this.

You can do better.

You will do better!

Take a leap of faith and don’t drop those prices! Here are four ways that you can get past competing on price alone:

1. Know the Company Story! Your salespeople have likely done hundreds, if not thousands, of in-home presentations. But do you know how well they present your company’s story? Maybe? Maybe not.

A well-articulated company story is crucial to generating credibility and gaining trust. How has your company stood the test of time? Is it a family-owned business? What kind of third-party ratings can you brag about? Is there a great anecdote you can include about how your company overcame x, y, or z obstacles?

If you aren’t convinced that your salespeople have your story down, ask them to record their sales presentations with their smartphones. Of course, they’ll want to make sure they ask the customer if it’s okay that they record a portion of the conversation, but the vast majority of customers will not have any sort of problem with this request – and you’ll have a much better idea of how well your salespeople are selling your company and not just your product!

2. Show AND Tell Many contractors are tempted to position themselves as “the best,” or “the most reliable.” But everybody says this. And if everybody says this, how can YOU be the ONE contractor telling the truth? All of a sudden you become “Johnny Fibber” and the customer is escorting you out of their house with a pitchfork.

It’s great that you believe you’re the best out there (and I’m sure your mom feels the same way), but you’ve got to do more than say it. You’ve got to show it.  How can you show folks that you’re the best without carrying a huge sack of trophies everywhere you go?

Photographic evidence.

That’s right, many people are visual, and it can go a long way in terms of persuasion if you can show them positive reviews, photos and/or videos that illustrate exactly what they should expect from your company. Pictures of your work, accompanied by glowing stories from satisfied customers will give your potential customers the “permission” they need to believe in your ability to get the job done right.

If you’re looking for a way to show your work off, look no further than Adobe Slate. This free App for the iPad allows your technicians and salespeople to scroll through photos and captions to tell a seamless, professional story of your business.

3. Guarantee satisfaction It is true that many contractors guarantee satisfaction. But are you really willing to put your money where your mouth is? I mean really?

What if you didn’t ask for payment until the customer was satisfied? Do you think you might lose some business in the way of people who claimed they were not satisfied? It’s likely you would. But this guarantee is so strong that people can’t help but believe the underlying value proposition. You have to give your prospects a reason to believe that you are truly different.

When you run the numbers, it is likely that your monthly payout costs would increase – maybe significantly. But it is also likely that you will be more than compensated by the significantly higher price that you are able to charge.

Your brand equity will grow by leaps and bounds, bolstered by a sterling reputation that is reinforced by a strong guarantee.  You will be able to charge a premium price, which will in turn help you pay a premium in terms of compensation for the “right” people with a high degree of skill.

4. Ask for the sale! It may come as a surprise that many salespeople don’t actually ASK for the sale when they’re done with their pitch. They don’t want to seem like the pushy sales guy. You know the one: the creepy, leathery used car salesman with the handlebar mustache and his shirt unbuttoned down to his belly.

If you’re in charge of these guys, it is critical you remind them they’re not shady salespeople. They are, instead, honest and dedicated individuals who have the customers’ best interests in mind and want to sell them the best product and/or service possible. It’s all about how they see themselves. If they see themselves as having integrity, it frees them up to ask for that sale at the end.

They are not pushy. They are interested in the best possible outcome for the customer!

Customers are desperate to find the differences between you and your competition. So give them some reasons (that are more important that price) to choose you!

The devil is in the details when it comes to differentiating your product and/or service. But, if done right, this strategy will allow your business to charge a fair price without losing business.

– Matt Csanyi

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