How to sell more with the “law of price equalization”

How to sell: Many times buyers put the squeeze on salespeople because they think that they are doing their job and saving themselves some money.

 

Let’s introduce you to…..

 

Law of price equalization – All things aside no matter how much you look for a product and what you pay for that product it will end up costing the same as a similar product or service that costs more.

 

Now this law may not fall under the category of covert hypnosis but it does go hand in hand with persuasive selling skills and abilities.

 

So you are a skeptic and that is perfectly ok and normal.

 

Do some quick math here.

 

You buy a widget for $10 that was built correctly and will last for 5 years.

 

You are able to find another “similar” widget for 7 dollars but it was made to last 4 years and is made with lesser quality products and has a higher failure rate.

 

Off the top of your head what one do your buy?

 

Well your own answer may change.

 

Depending on what order you looked at the two widgets may actually determine what one you buy.

 

This Law of purchasing justification is what all sales processes are built around.

 

The law of purchasing justification happens when a person or group looks at a product or service and decides that one option is better than another based upon pricing, features and benefits.

 

Within this rule it is almost impossible to compare products or services.   

 

Some people would pick the widget for $7 while others would pick the one for $10; so what one is the better option?

 

The $10 widget is the one that would work and meets the criteria and will last

 

The $7 widget will work but will need to be fixed more often plus you took the extra time to go “shopping” to find that product and the intangible here is how much is any unit of your time worth.

 

Many time consumers get caught up in all sorts of research to determine what option, service or product that will work better for them. In the meantime the consumer who bought the $10 widget can get on with their life and know that the widget will last.

 

Many times consumers who get caught up in finding the “best deal” cut quality of products or sacrifice service to make up the difference of a few dollars only to have to pay more in the long run.

 

One of the biggest lies to ever come out of a college classroom is the saying of the “Lowest cost with best quality” these two options are direct opposites of each other. It is not possible to have the best quality and the lowest price ever. This is a case of either or but not both of the options. Something had to be sacrificed in order to get the cost lower and that means that the “best quality” is out. The saying should be medium product with and even price is what you are going to get.

 

You can usually tell how long a company is going to last by the words that are advertised in their marketing:

  • ·         Affordable
  • ·         Discount
  • ·         Low cost
  • ·         ‘highest quality and lowest cost”
  • ·         Best value

 

These are normal signs that a company is in trouble and will have to make changes in the future and will either close or will force themselves to raise their prices or use a discount product.

 

Ok so you are right the largest retailer does advertise something similar but they are not the lowest cost on all products. They make up the difference in other products or services so they do not always have the lowest price unless you go to the competition and get the price and then come back and prove it.

 

This “time and effort” would eventually take up whatever cost saving time was spent in order to purchase the product or service.

 

Now there are a few places where the Law of price equalization would not work for some people. If you needed a car and you were going to buy a new one this law would not work if you were to compare a 458 Ferrari to a Chevrolet Malibu. Yes they both will get you were you need to go but they both were built for different purposes. So in an event of different purposes this rule does not work.

 

Many times you will find insurance companies advertise lower rates but in order to get those rates they must raise the cost of deductibles. By the time that you pay for the deductibles you may end up paying more but some people are willing to take that risk and then justify why they did what they decided to do.  

 

The Law of price equalization works more into your favor as most products are made from less companies or competitors. In many instances most products are made from the same exact parts in 3 or 4 plants with multiple brand names with different prices even though they are the exact same product.    

 

The last part of this law is that when a lessor quality product or service is used that product or service that is less will eventually cost more over time when the better quality service or product could be substituted.

 

By taking the time to evaluate what the better product or price is you may find yourself spinning your wheels where you could have gotten on with your life.

 

Persuasive selling skills and techniques may help you sell more over time and increase sales percentages. Knowing how to explain how to save your clients time or energy may be your best ally instead of fighting over price.

 

Explaining the law of price equalization does take some practice with role play before trying to explain this to a potential client.

 

As always I would like to thank you for your comments and or questions.

 

Now go implement!

 

Scott Sylvan Bell

11 thoughts on “How to sell more with the “law of price equalization””

  1. The abilities for sales success are somewhat dependent on the Law of price justification. When a consumer is uneducated it’s impotant to use your selling skills of persuasion to prevent rejection and to make certain the uneducated consumer doesn’t purchase incorrectly. I wish I had a sales proffessional with me when I shopped for my first set of tools. I must have spent a couple grand buying weekend the weekend warrior tools my grandfather had in the basement. Had I spent $500 or $600 more, they might have lasted more than a week and a half.

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