What are the best ways to handle price objections from customers and competitors?

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Price objections are inevitable when you launch a new product or service, especially in a competitive market. Customers may compare your offer to cheaper alternatives, or question the value of your solution. Competitors may try to undercut your pricing or offer discounts to lure away your prospects. How can you handle these challenges and convince your customers that your price is fair and worth paying? Here are some strategies to help you overcome price objections and close more sales.

本文章的要点总结

Demonstrate value:

Shift the focus from what your product does to how it benefits the customer. Instead of tech specs, paint a picture of the customer's life improved by your product, making price a secondary consideration.
Be market savvy:

Show customers you're not just selling; you're an expert in your field. Explain how external factors influence pricing and where your offerings stand in the market, adding depth to your value proposition.

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Ferenc Fekete

I help startup founders launch…
Sinead Lawson

Business Development professional |…

1 Understand the root cause

Before you respond to a price objection, you need to understand what is behind it. Is it a genuine concern about affordability, or a sign of hesitation, confusion, or lack of trust? Sometimes, customers may use price as an excuse to avoid making a decision, or to negotiate a better deal. Other times, they may have unrealistic expectations, or lack information about your unique value proposition. By asking open-ended questions, listening actively, and empathizing with your customer, you can uncover the real issue and address it accordingly.

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Sinead Lawson

Business Development professional | Defence technology & interconnect solutions
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Know your market; your transactional party might not! Be prepared to demonstrate that you are an expert in your market, bear the ability to factor in exogenous macro factors and have a rationale behind your pricing structure. Complete competitive analysis and benchmarking. ?What are the more prevalent cost-drivers? (E.g. raw materials, overheads, interest) ?Is your supply goods-based or service-based? ?What is the current economic climate and projections for the short to mid term? ?Where do you identify your goods or services on the spectrum of low-end to high-end? ?Is it a suitable classification? The ability to be perceived as an expert and educational source adds further value to the transaction and future access to you.

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Liton Kobir

Digital Marketing & Advertising Strategist | 13+ Years Experience | Google Ads Partner Since 2015 | AI-Powered Marketing & Advertising
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If someone objects to a price, you should understand why and react in the right way. To find out what the real problem is and how to solve it, ask open-ended questions, listen carefully, and show empathy for the customer. This will ensure a satisfactory result.

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2 Focus on value, not features

One of the most common mistakes that startups make is to focus on the features of their product or service, rather than the value that it provides to the customer. Features are what your product does, but value is what your product does for the customer. Value is the benefit, outcome, or solution that your product delivers, and how it helps your customer achieve their goals, solve their problems, or satisfy their needs. To overcome price objections, you need to demonstrate how your value outweighs your price, and how your product is different from and better than your competitors.

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Ferenc Fekete

I help startup founders launch market-ready apps without the need for an in-house tech team. Co-Founder at VeryCreatives
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To effectively communicate value over features, shifting the narrative from mere product specifications to the tangible benefits a customer will experience is crucial. Instead of saying, "Our software has a 256-bit encryption," emphasize, "Your data's security is our priority, ensuring peace of mind with top-tier encryption." Similarly, rather than stating, "Our vacuum cleaner operates at 2000 watts," convey, "Experience a cleaner home faster, with powerful suction that captures even the finest dust." By reframing the conversation, you're not just listing what your product can do but illustrating how it can make a difference in the customer's life.

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Ashfaq Shah

Head of Corporate Business - Pakistan @ Emirates | Partnerships, MarComms, Corporate Sales
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Address concerns with value-based messaging, showcase unique features, offer flexible pricing options, and highlight customer success stories. #SalesTips

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3 Use social proof and testimonials

Another way to handle price objections is to use social proof and testimonials to build credibility and trust. Social proof is the evidence that other people have used and liked your product or service, and testimonials are the positive feedback and reviews that they have given. By showing your customer how other people have benefited from your product or service, and how they have overcome similar challenges or objections, you can reduce their doubts and fears, and increase their confidence and desire. You can also use social proof and testimonials to highlight your competitive advantages and unique selling points.

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Liton Kobir

Digital Marketing & Advertising Strategist | 13+ Years Experience | Google Ads Partner Since 2015 | AI-Powered Marketing & Advertising
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People who don't like the price should use testimonials and social proof to build trust and trustworthiness. Social proof shows that customers have had good experiences, while reviews show that customers have given good feedback. You can boost your confidence and reduce questions by showing how other people have dealt with similar problems. Bring out your unique selling points and competitive benefits.

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Ferenc Fekete

I help startup founders launch market-ready apps without the need for an in-house tech team. Co-Founder at VeryCreatives
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Testimonials serve as powerful tools in the sales process, acting as third-party endorsements that resonate with potential customers. A startup offering a premium software solution might face price objections. The startup can address price concerns by presenting a testimonial from an industry expert praising the software's features and ROI. Similarly, a B2B company can leverage testimonials from key clients, highlighting how the product led to increased efficiency or revenue growth. Such testimonials validate the product's value and emphasize its distinct advantages over alternatives. Video testimonials can be impactful, as they offer a human connection, allowing prospects to see and hear real users vouching for the product's worth.

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4 Offer a trial or a guarantee

Sometimes, customers may need a little push to overcome their price objections and make a purchase. One way to do this is to offer a trial or a guarantee that reduces their risk and increases their satisfaction. A trial is a limited period of time where your customer can use your product or service for free or for a low cost, and experience its value firsthand. A guarantee is a promise that you will refund or replace your product or service if your customer is not happy with it. By offering a trial or a guarantee, you can show your customer that you are confident in your product or service, and that you care about their success.

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Ferenc Fekete

I help startup founders launch market-ready apps without the need for an in-house tech team. Co-Founder at VeryCreatives
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Offering a guarantee for B2B SaaS - especially high-touch products - can be a game-changer in alleviating price objections. Performance Guarantee: Assure clients that your software will deliver specific results within a defined period. For example, a CRM tool might guarantee a 10% increase in lead conversions within the first three months. Uptime Guarantee: If the software experiences more downtime, offer compensation, such as a month's free subscription. Money-Back Guarantee: If a client is unsatisfied within the first 30 days, offer a full refund. This shows confidence in your value proposition. Onboarding Guarantee: If a client needs help with onboarding, offer additional training or support at no extra cost.

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5 Stand your ground

Finally, you need to stand your ground and not compromise on your price too easily. If you lower your price too quickly or too often, you may undermine your value and credibility, and attract customers who are not loyal or profitable. You may also create a bad precedent for future negotiations, and invite more price objections from other customers. Instead of discounting your price, you should reinforce your value, and offer other incentives or concessions, such as payment plans, bundles, or bonuses. You should also be prepared to walk away from customers who are not willing to pay your price, and focus on those who are.

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Agnès BROC

Fondatrice & directrice @Strategic Design + Professional associate @Strategic Research
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Il faut effectivement apprendre à assumer ses prix. Pour cela, formez vous à la négociation (ce qui a été mon cas, avec succès). On vous apprendra : 1) à répondre “oui” quand on vous dit “c’est cher” puis à attendre que la personne développe, en silence, sans prononcer le moindre mot. Vous affirmez ainsi très simplement que vos prix sont justifiés. 2) à ne pas diminuer son prix sans contrepartie. Par exemple “je baisse de tant mais je supprime une présentation orale.” Ou je baisse le prix unitaire mais en augmentant les quantités achetées”. Dans le cas contraire, on peut penser que vous avez gonflé vos prix initiaux.

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6 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?

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What are the best ways to handle price objections from customers and competitors?

1

2

3

4

5

6

1 Understand the root cause

2 Focus on value, not features

3 Use social proof and testimonials

4 Offer a trial or a guarantee

5 Stand your ground

6 Here’s what else to consider

Startup Development

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What are the best ways to handle price objections from customers and competitors?

1

2

3

4

5

6

1 Understand the root cause

2 Focus on value, not features

3 Use social proof and testimonials

4 Offer a trial or a guarantee

5 Stand your ground

6 Here’s what else to consider

Startup Development

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