The Price Shopping Lead

The Price Shopping Lead

By Ian Richardson, Managing Partner, Richardson & Richardson Consulting LLC

The Price Shopping Lead

In an earlier blog, I dove into the difference between a lead and a referral. We discussed the difficulty associated with marketing generated leads, including why it can be so difficult for a sales representative to close them and why you’re 3 steps behind with a lead versus a referral. In this article, I’m going to explore my favorite type of marketing generated lead, the price shopping lead, and why they’re so great in my mind.

The three types of marketing generated leads

Before we dive into my favorite type of lead, it’s prudent to review the types of leads you’ll get from marketing initiatives. I’ve found throughout my career that there are three types of marketing generated leads. Those leads, in no particular order are as follows:

  • An organization has a new leader or manager whose responsibility includes the product or service you offer, and they are looking for competitive options as part of routine due diligence.
  • An organization has a provider for the product or service you offer, something negative has occurred, the organization or a subsection is hurt, angered, frustrated, or confused by the negative outcome, and is looking to potentially make a change.
  • An organization has a provider for the product or service you offer, their provider has raised their rates for that product or service, and the organization is not seeing enough value from that provider to continue moving forward with them and is evaluating competitive options.

What’s so great about the price shopping lead

So why do I love the price shopping lead so much? They’ve given you permission to talk about money up front. This lead will self-identify that they are concerned around cost of the product or service they’re current consuming from elsewhere.

They’ve given you a major concern! What else could you hope for at the top of a discovery call? The technique I use with these leads has been tried and true for more than a decade, and I’ll lay it out for you below.

  1. Explore what they’re currently receiving: Get a hit list of what they understand they’re buying.
  2. What were they paying previously, and what are they paying today: You need to understand current outlays and historical outlays to be able to have the conversation get deeper.
    1. If they push back, don’t get stressed. “I heard that you’re concerned about sharing costs, is that right?” Be ok with silence here. If you heard wrong, then confirm what their concern was and get what they’re paying from them. If they are concerned about sharing costs, move into the following “I can understand and relate to that. I’ve been concerned about sharing pricing information before when finding a new provider as well. Our pricing is fixed, regardless of the organizations we service. You wouldn’t pay more or less than someone down the road who has the same needs, problems, and goals. Since cost is a concern for your organization, I need to make sure I understand the current expenditures as we continue to explore a potential partnership.”
  3. After you have what they’re paying, it’s time to dig in and find problems and explore ways to justify the new costs: You certainly don’t want to charge less than the competition for business. “So, in a perfect world, there are never any problems with a relationship or [products/services]. Nothing is ever perfect – What could be improved in your current relationship with your current provider?”
    1. Explore the responses: Ask “why, what does that mean, how does that impact your world, how does that impact your team’s world, what does that cost when it happens” and other similar discovery questions to get a good understanding of what the prospect finds “not right” about their relationship.
    2. Remember this person is concerned about money: Dig into that. Find cost after cost that may be hidden about “little” things that are bothering them – monetize it any way you can.
    3. Areas of cost are usually consistent of hard costs (such as dollars spent on a product or service), soft costs (such as payroll), lost revenue (such as clients or prospective clients leaving the organization for a different provider / cancelled appointments), and opportunity cost (time spent solving this issue that could have been spent elsewhere).
  4. Explore what would make them willing to pay more. This is a key area to dive into. You have what the new cost would be, and you have that they don’t see value. Stitch together a future state: “So Mrs. Customer, if those issues we explored were fixed, and you received all of the products/services you were currently paying for, would the cost that your provider is now charging you be ‘worth it’?”
    1. If yes, you have all you need to pull together a value proposition presentation to win the business.
    2. If not, ask “What would need to be done to make that cost acceptable?”
      1. If there is nothing that would make them see value, you can disqualify this lead.

Final Thoughts

Marketing leads are tough to close, if you don’t have a solid sales process you follow. If you have a process, any qualified lead can become a customer with patience and time. Start working on your ability to break through a price objection now so that you too can find the joy with a price shopping lead.

If you’re struggling with closing marketing generated leads, figuring out how perform a good discovery around price shopping leads, or creating a strategy on how to raise your prices, Richardson & Richardson can help. Check out our case studies for stories of organizations that we’ve assisted with similar issues and download our white papers for deep dives on tools you can use in your organization. If you’re wondering where to start, book a complimentary session with one of the Richardsons today to come up with a plan on how to move forward.

 


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