BY Jessica Helinski
How do you respond to discount requests? Giving discounts isn’t necessarily a bad thing. If done strategically, discounts can encourage a sale along. Plus, they can actually add value for you in the long run. Or, they can help you disqualify a sale that would have stalled due to lack of budget.
And sellers certainly face cost-related objections, according to SalesFuel research. 37% of sellers say top objections they hear include:
- The price is too high (cited by 34%)
- Buyers don’t have the budget (34%)
- Buyers can find it cheaper elsewhere (23%)
Why be cautious when responding to discount requests?
But many reps offer discounts early in the relationship just because the prospect asks. HubSpot's Michael Pici warns reps that offering discounts too soon risks the following:
- Devaluing your product or service
- You immediately put price in the spotlight
- You lose bargaining power
But, if the prospect mentions discounts early in the sales process, what do you do? Luckily, Pici has some great advice.
He admits that it can be challenging, noting that “you must satisfy your prospect’s expectations without destroying your profit margin.”
He shares different replies you can give when confronted during different stages of the sales process, making it easy for you to satisfy the prospect and maintain your leverage.
During the first call
If asked about discounting during this stage, Pici suggests redirecting the conversation to what the prospect is looking for and their needs.
Ask about pain points and any specific challenges they are having and tell them that this can help you determine a more accurate discount estimate.
“If the price of your product or service largely depends on the individual prospect’s needs, goals and situation, it’s too early to discuss discounts,” Pici explains.
You need to know the total value of the deal before you can offer a discount that works for the customer and remains profitable for your business.
But, most importantly, acknowledge the mention of a discount in your response. You don’t want the prospect to think you are ignoring the request or blowing it off.
Explain that you’d love to talk about discounting but need more information to properly do so.
Another possible response is to note the discount, then ask if price will be a major obstacle for them. This can clear up whether the prospect truly can’t afford the standard price or is simply looking for a better deal.
If they say price won’t be an obstacle, proceed with the sale. If it is, explore their budget further and determine whether they’re a viable prospect.
During negotiations
Facing discount requests during the negotiation stage can benefit from a slightly different approach. Questions for asks at this point in the process can be met with a simple, one-word response: “Why?”
This will immediately help determine whether the buyer genuinely needs a lower price or is simply testing whether you’ll negotiate.
Some buyers who ask for a discount may be willing to pay the full price once they realize the price isn’t negotiable.
If their response suggests there really is a deeper reason for requesting a discount, you can then proceed with addressing those pain points.
Consider asking, “What would be a reasonable discount?”
This turns the discount request into a question to determine whether the buyer doesn’t see the solution’s value or simply can’t afford the price.
If budget is the issue, offer a less expensive option rather than discounting the same product. If they still want the higher-priced option at a lower price, return to the conversation about the product’s value.
“If your prospect says they want the more expensive product at the lower price, on the other hand, return to the value conversation,” Pici explains.
These approaches can help you better respond to discount requests when they pop up. Instead of immediately caving, you can expertly uncover the true reasons behind each request and move forward to reach a win-win scenario.
