Its unfortunately true and seldom works as planned, but lowering the price to increase sales is a frequently attempted and usually a failing concept. In fact it could lower sales. Its not the price that counts the most.

The true underlying principle for closing sales is to deliver a perception of value to the potential customer. It has been demonstrated time and again that price alone is not the determining factor in a customers buying decision process. Service, quality, guaranty, and perceived value are held to be more important then price every time this issue is studied.

The more important factors all combined can cause a buying customer to purchase something more expensive because of the perceived value the whole package appears to be offering. Thus a training program, or in house repair, or whatever the benefits may be,  the perceived value as determined by all the benefits, supports a customers decision to purchase a more expensive deal then may be available elsewhere but sold with less perceived value.

This is frequently accomplished by “free” add ons to the basic product or service being offered and works very well. Be it non related gifts or additional accessory packages, upgrades at no additional charge, extended guaranty, anything to increase perceived value.

In other situations it may be simply preparing the sales presentation to demonstrate increased intrinsic value by identifying cost savings while operating this product or services which may result in extra longevity, or future savings or greater earning potential of the service or product, all adding value to the customers perception of what he is considering buying.

Thus the retail return or gross profit percentage when reselling the product to the business purchaser may be more important then the purchase price.

The conclusion being that any sales presentation or advertising and marketing program to be as successful as possible must include a serious effort to demonstrate and elevate the perception of value to the customer and if successfully done far more product or service will be sold.

To increase sales revenue and profitability don’t lower the price, increase the perceived value.

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