What an item is worth and what an item is priced at are often used simultaneously in many retailers’ marketing materials and sales pitches. Many customers will balk at an item they don’t think is worth the price by saying, “It’s not worth the money.”
And why not?
Too often discounts have been the first resort for retailers who want to attract new customers or increase their overall sales. Retailers have overused this to a point and have now found that slashing prices are no longer a can’t-miss way to drum up business and pump some life into their sales.
Those discounts also a lose-lose proposition for the store. And this is especially true as savvy millennial customers cherry-pick the best item with the deepest discount and avoid the profit-filled add-ons.
It’s like they go to the bargain matinee but never visit the concession stand.
In the short term, discounts eat directly into retailers’ profit margins. Outside of a new location or product launch, discounting to make sales is never a winning proposition.
For an established retailer, it’s like trying to lighten a sinking ship by throwing the cargo and the people overboard. It may work, but then what’s the point of the ship?
In your case, you keep attracting dirt-scratchers who will only show up for the discount. Soon, you won’t be able to pay your bills. Those losses will rob your neighborhood of a great store.
In the long term, making everything all about price devalues your products.
The price you can sell an item for is the price that customers will expect you to sell it for. When you end your promotion, coupon, or other discount and try to return the products to their original prices, customers will see it as a markup instead of a return to the basic value of the item.
So will your employees, who probably can’t afford your premium items anyway - and certainly not at full price who will tell your customers to wait for the next coupon, promotion, or sale.
Relying on value selling eliminates these problems. The price of an item, in terms of actual dollars, becomes secondary to what the product can provide for the consumer.
The Weakest Link
Price is the weak link in the sales process. When salespeople harp on and on about how something is on sale or cheaper, all the customer can think about is price and all the money coming out of their wallet. This distracts them from other considerations like the quality of the product and whether it will best serve their needs. It becomes a logical choice. Buying at a brick and mortar store has never been a logical choice. With stastics that one family in ten uses a storage facility, it is clear we all have too many clothes, accessories, and furniture. As long as selling is centered on the logic of price, the salesperson will be at a disadvantage.
A Position of Strength
The easiest way to avoid this weakness is by putting your sales staff in a position of strength. They need to know how to sell. Giving them the skills and knowledge to focus on selling the value of a product will allow them to avoid those down the rabbit hole conversations about price. While it could involve an intimate knowledge of individual products, it is much more about understanding, listening for, and observing the unique buyer motivations. Armed with these tools, your salespeople can keep the conversation focused on benefits (value) instead of costs (price).
Making Every Sale a Value Sale
Customers come into your store with their own notions about the value of products. It could be based on a friends’ recommendation, a web search, or on something they saw. They may not want to buy higher-priced items because they don’t feel that there’s a difference in quality or value. What they don’t have is the wisdom that sales training will give your salespeople. Using that wisdom of how products compare based on customer feedback and their training, salespeople can show customers that there really is a difference between good, better, and best.
Getting it to Work for You
Value selling needs to occur every time a customer walks into your store. It can’t be second nature to your salespeople, it has to be first nature. With the chance the shopper’s smartphone will cheap, buzz or vibrate, there’s no time for winging it.
Well trained salespeople will automatically rely on value selling in any sales situation.
To sell value over price, your salespeople will need to know how to sell using these three skills:
Customer Communications. When talking with customers, your salespeople need to be examining the customer’s preconceptions and motivators to buy. Why, of all the days they could walk in, did they come into our store? Every bit of information the customer provides will help your salesperson create a narrative that connects the value of the product to the customer’s wants. Once that connection has been established, the customer begins to see the product as an asset instead of a cost. And you see the true ROI of your training efforts.
Product Mastery. Your salespeople need knowledge that extends beyond product descriptions found on a tag or a box. Many of your customers already have that from a basic web search. Your staff needs to know how products are used in a variety of situations, so they can match the value of the product to the needs of a wide variety of customers. They also need to know about product add-ons that increase the value of the original product well beyond the increase in price.
Overcoming Preconceptions. Now that your salesperson has the customer thinking about value, it’s time to talk about levels of value. Some customers always go for the cheapest items, believing that the product won’t last anyway. That’s simply not true. In today’s marketplace there are plenty of vendors cutting corners with plastics, polyesters, and fillers. Your sales staff can help a customer see that by educating them what goes into a premium item. Instead of a single, low-margin sale to a jaded shopper, you can make a higher sale to a customer who now has a better understanding of the quality you offer.
Value-based selling should be the foundation of all of your sales efforts. Establishing the value of your items and educating your customers about that value makes it possible to avoid the discounts that eat into margins. It puts your salespeople on strong footing, allowing them to deal with customers on the basis of product benefits as opposed to product costs.
Your products have value and you know what that value is or you wouldn’t have them on your sales floor. Discounts undercut that value and make customers view anything without a markdown with suspicion.
Don’t rely on discounts to move merchandise for short-term sales. If you want to grow your sales, giving your salespeople the tools and knowledge they need to convey the true value of your products to your customers will do just that.
Get our weekly newsletter updates. Read our mailing consent T&Cs here
The 5 Shifts Brick-and-Mortar Retailers Are Making to Generate Up to 20% Higher Profits Every Month
Are you a hungry brick-and-mortar store owner who’s ready for a fresh, people-obsessed strategy? This training is for you if you want to grow your business using a powerful customer experience formula proven to make your cash register chirp.