How Many Choices Should You Offer When Negotiating?
If you think giving prospects a variety of choices is a good idea, you may want to think again. Rather than simply showing diplomacy and earning trust, offering choices can actually cut into your revenue. Tibor Shanto, of Renbor Sales Solutions, suggests that reps don’t offer choices. “While there are some pros and cons, there are three reasons you should not give choices…,” he writes. Read on for two of his three reasons why you may want to reconsider this strategy:
When you offer choices that vary by price, prospects are likely going to select the mid- or low-priced option. Often, reps will offer three tiers of pricing to put less pressure on the prospect. And, usually, the highest-priced option is never chosen–and that potential revenue is lost. So why set yourself up to lose money? “When we change the approach to presenting the best option [with] one price, one decision [is] much easier to make than three,” Shanto explains. “Quicker sales, more revenue, no unhappy customers.”
Successful salespeople present themselves as subject matter experts. During the sales process, reps uncover the issue(s) facing the prospect. Then, using their expertise, make a recommendation. “As a subject matter authority, you build the right to make a recommendation based on your expertise, experience, and support of the company,” he writes. “Imagine if you went to an expert for help, a doctor, and after they talk to you, examine you, and share their prognosis, [they] offer you three options. Would you not look to them, the expert, to make a recommendation?” With that hypothetical, Shanto makes an excellent point. You can’t position yourself as an authoritative expert if you can’t confidently offer a single best option.
In his article, Shanto makes a convincing case for not giving prospects choices. If presenting options is part of your strategy, consider his advice and whether offering options really helps you in the long run.
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