Max Bottaro

Psychology over Economic principles

When I first started in sales, I had a very scientific view of selling: “When the buyers perceived value of the product matches the price, a transaction will occur”. This brittle supply and demand view of sales got me sales, but they were mostly low balls. I figured if they didn’t want to buy at a certain price, just keep knocking off dollars until they agreed to buy. The art of selling is far more complex than just cutting the price until a prospect agrees to buy.

In parts of Africa, I am told that there are no set prices in markets. All prices on goods are set at ridiculously high values, and it is customary to argue the price down to a reasonable level. A traveler, who wasn’t aware of these cultural customs, was asked to pay roughly $7 for a head of lettuce. The man angrily paid in his haste, and left. The next day that vendor refused to sell to him, his quick buy was perceived as rude. By not agreeing to engage in the customary back and forth that accompanies these native transactions, the travelling costumer was seen as curt and snobbish.

The point is the perception of a deal is far more powerful than a monetary deal. Humans are not economic computers that calculate net worth and personal demand, if someone feels like they are getting a deal, that’s all that really matters. They will be a content buyer, and you will be a richer salesman.

So how do you increase the perception of a deal without lowering your prices? You create a struggle, or a battle. Make the prospect feel like they have to work to get the deal out of you. Here are some tools to help create the perception of a struggle:

· Offer smaller non-monetary add-ons: “Ok, I’ll throw in some extra bags and belts, but you can’t tell my supervisor”.

· Lower price somewhat, but justify the discount, otherwise your price seems arbitraury and you lose credibility: “I understand the price is a bit high… If I could get you a $100 discount, and I’m not saying I could for sure, but if I did, would you buy? I am willing to give up my commission on this sale because I am 1) trying to hit a weekly bonus 2) A few sales away from winning a trip 3) you are the last house of the night, etc…”. The reasons for the discount at the end are extremely important. You can’t just slash prices and not justify, it seems sketchy. Try not to lie about the reason though, In my sales job we always do have bonuses and trips to win for just that reason- to justify discounts and close deals. The bonuses really do exist, though.

· Make sure the costumer thinks you are bending over backwards, even if the request is small and reasonable. “Alright, Mrs. Jones… I will call my supervisor and see if we can’t get you a trade in for your older unit, but we generally discourage it. If I can make this happen, you have to promise to keep this deal between us, O.K.?”

· Get the costumer to throw in something small as well. “I think I might be able to give you a discount for your old vacuum, but you have to tell 3 friends about us, deal?” (This is one of my favorites, it really gets the costumer thinking they have outsmarted you… the truth is I don’t give a damn who they tell; as long as they feel they screwed me and not the other way around.)

· Get a commitment before you try and close a deal- build up suspense. “Ok Mrs. Jones… if I get you this discount, can I welcome you to the Kirby family? I am not sure if I can authorize this big of a discount, but at this price you are serious- not just curious, right? You won’t make me look foolish if I call the office and ask for this price, will you?”

Then I’ll lean forward like I am about to do something really intense, and make a call to my “office”. I always let it ring a few times, then hit them with the request’ “Hey Sean, I know we don’t usually do this, but I am with Mrs. Jones right now, and she agreed to buy if we could get her deal x… I know it’s a lot to ask, but I was thinking it might be worth a shot because of our competition… are you serious!… Ok I’ll ask her- Mrs. Jones, do you promise to keep this deal between us? Really, you won’t tell anyone?” At this point I’ll stick out my hand, AKA my ‘payday wand’ and welcome her to the Kirby family. This is called “assuming the deal”.

The point is people feel like they got a deal if they fought for it, so the best thing to do is create a struggle and eventually give in to a smaller request as opposed to lopping off a larg amount of cash right from the start. You can close a deal by discounting $1000 in a minute or $100 in an hour. It’s up to you.

“Closing isn’t about price- it’s about compromise” – James Peterson, Top Dealer in the Northern Region