This blog is all about how to sell more, but a more refined question would be about how to sell more without dropping the price. It’s one of the questions that inevitably pops up in different forms at each of our Sales for Startups events. We’ve already written about sales tips for price negotiations and how to get your first paying customers.
The question about price that came up this time was answered by two of the panel members – Patrick Barnes and Philip Tnee. Philip is a former Facebook Client Manager who now heads Sales at Purpleclick Media, a leading SEO and SEM company in Singapore
Patrick is the CEO and Cofounder of Advocately, a platform that offers advocacy programs for B2B SaaS companies. Both of them have been working with various organizations across different markets.
Question by Aradhana: So as a company who is starting to cater to a different market, a service company, how do you tackle a prospective client? Fixed it was your ideal client, you’ve addressed the pain point, you don’t want to send out that breakup email. Their only point for stalling.. They know you are awesome… they know you’re really good is price. And it’s not that because you are outrageously expensive. They know what the market rates are.
They’re just, like Zal said, it happens a lot in India, but it does tend to happen a lot in Asia, I mean they know you are good. So, is there a way, as a service company, to explain to your client that is the number of man hours we gonna put up, it goes to your point where you said that you know we’ve got 35 engineers working on it. Do you think that helps, or how much do you let go just so that you are established in a new market or a new territory to get you know your first initial clients, whether it’s a different industry or a new market? Like, how do you gauge that? And I know this is a tough one and I’m sure there isn’t a 100% solution, but I struggle with that being a service provider, because people are always… they want to build a rocket with 5 dollars… so..
Patrick Barnes, Advocately: I think anytime pricing is discussed, there needs to be.. there needs to still be an exchange. Like, it’s not just like oh cool, we’ll make the price lower. Is this okay? It’s not cool, we understand that it’s a first project, we are just starting out. Like, we are happy to do something with the price. If we do something with the price, then you pay us today. Like , you do like oh… actually, no do it. You know like, what can you pay right now? Okay, right.
Will you do a 2-minute video case study with us and not only allow us to distribute it, you’ve got a bigger audience than us. Could you distribute it to your audience? And then you almost come up with, what you do is while you break, you can close deals (a), you can make sure you get the money, and you get some distribution, but you’re still maintaining parity with the client.
Cool, you understand, it’ll just be for this job right? Once we review and then all of a sudden you are selling future business at a higher rate than the day whenyou discounted. There will be a couple of things that potentially start considering. But, it could be there’s a problem that’s not related to price that you don’t necessarily know about. It’d be something else to consider, but there are couple of triggers that might probably explain.
Zal Dastur, Lucep: And I think Philip talked about earlier where you mentioned pivoting. So you make sure that you get to trade, right. Like, okay fine, what else, I’m not gonna lower my price, maybe I give you something a bit extra or something like that…
Philip Tnee, Purpleclick: Yeah, just to add on to that, if your product is … You are able to actually accelerate the consumption of your product, whatever it is you are selling, you know, that could be something that you can sacrifice margins on as well. You go up to a higher spend coming over a longer period vs you know, getting them a higher price up front. And I think that could be incremental because they are gonna upsell themselves in the time to come. You know they love your product and it’s a good fit all and stuff. So it’s just a matter of time and that’s some, one of the approaches you take with your clients as well.