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Trust In Pricing

by Doug Davidoff | Oct 8, 2010 5:03:02 AM

Everyday, I hear salespeople complain and moan about how customers are so price sensitive.  They tell how customers are less loyal than ever before or how companies’ sole buying goal is to commoditize sellers.

I always caution that these are symptoms of a much deeper problem.  At the root of the problem is a complete breakdown of trust that buyers have with sellers - especially in the area of pricing.

A common sellers' practice that drives me around the bend and contributes to this distrust is how sellers pad their pricing on opportunities that they perceive to be easy or already won.  When sellers price their offerings from the perspective of "how much more can I get," instead of pricing from the perspective of creating a true win/win - they are begging to be commoditized; after all that's what the seller is doing to the buyer.

I understand that this practice is as old as the world of selling is, and I understand the motivation to "get what you can" when profit margins have the type of pressure that they do.  But - and this is a big "but" - in today's drought, there are no easy one's.  You may trigger a shop cycle when you didn't need to.

I remember when I was young and first entering the world of sales.  My mom cautioned me about some of the darker behaviors that occurred in that world.  I asked her how would I know if something would be a mistake and she told me, "Doug, just pretend that whatever you do will show up on the cover of New York Times, if it would embarrass you - don't do it."  I think the same advice applies to your pricing.