The Solution to DiscountingBy John Barrows | December 28, 2016
2016 is ending and I’m guessing a bunch of us are offering up major discounts to get clients to sign by the end of the year so we can hit our quota or accelerators. I get it — I do — but we need to be better than that and should instead do what we can to reverse this horrible trend. Discounting has such a negative impact in so many ways it’s worth pointing out a few things to gain some perspective.
The Deal With Discounts
- Salespeople make a bigger deal about price than buyers do
- Whoever feels the most pressure will make the most concessions
- Discounts kills credibility and creates a negative perception of you and your solution
- Discounts set the stage for future discounts
So what’s the remedy?
A Big Fat Pipeline
There are some negotiation and objection handling techniques that can help but the best solution I’ve come across is to have a BIG FAT PIPELINE. The more legitimate, healthy opportunities we have in our pipeline the more confident we can be in dealing with negotiations and therefor the less we discount. With a big fat pipeline we can put ourselves in a position where we WANT their business, we don’t NEED their business. When we want their business we sell the right way. When we need their business we do some shady stuff.
Also, as this relates to “closing,” the biggest challenge or problem with closing is that we tend to close on our timeline, not the clients. We need to hit our monthly, quarterly, or yearly quota which is why we push for the wrong reasons and use discounts. When we push to close on our timeline we tend to push the client away and destroy whatever rapport we’ve built up with them. When we close on their timeline we can push for the right reasons. And a big fat pipeline allows us to close on their timeline.
Prospect, Prospect, Prospect
This is why prospecting on a regular basis — even monthly, quarterly, and at year-end — is so critical. Spend 30 minutes a day prospecting in some way, shape, or form. It can be cold calls, direct e-mails, searching through LinkedIn, asking for referrals, or whatever: just do it. If you’re sick of feeling cheap and using discounts to close all your deals then prospect every day. You’ll soon have a consistently full pipeline and will see what happens to your confidence and your ability to manage discounting.
To start off 2017 with a big fat pipeline, check out my Filling the Funnel online portal for tips on prospecting and discounting. I’m also offering whatever individual help I can through direct feedback on SnapChat (johnmbarrows) where I’ll answer any questions you have.
Let’s #makeithappen together in 2017!