Tweet

Sales is Discounting Again

Written by: Rebel Brown

Article Overview: How many times have I heard this cry from clients? Always makes me wonder if corporate citizens understand and appreciate how hard selling can be - especially if you have little air cover and not much ammunition. The fact is that if sales is discounting it means the company, and particularly marketing, hasn't done its job. I'm not trying to pass blame - just pointing out a 'relative' truth.

Sales is Discounting Again

How many times have I heard this cry from clients? Always makes me wonder if corporate citizens understand and appreciate how hard selling can be - especially if you have little air cover and not much ammunition. The fact is that if sales is discounting it means the company, and particularly marketing, hasn't done its job. I'm not trying to pass blame - just pointing out a 'relative' truth.

Sales people salivate for dollars. Come on, we all know that. At least the good ones salivate - they'll do whatever it takes to bring the revenues into your company so their wallets are happy. Those are the reps you want working for you. So if they are discounting - before you blame them, take a harder look.

Sure you'll always have a select few deals you discount to open a door or seed a market. But those are exceptions, not the rule. Especially if discounting means that reps are losing money out of their own pocket. If reps are discounting consistently, then something is wrong.

Don't immediately assume it's because the sales reps can't sell your value. Their natural inclination is to do just that and make more commission dollars. So if the whole force is discounting, something else is going on. Look beyond the sale force. For example:

• The Product. This is the last place technology companies want to look, and probably the first place they should focus. It's human nature to fall in love with your children, er creations. That's what our technology products often become as we develop them, enhance them, nurture them. But more often than not when sales is discounting the product, its capabilities, design, stability, architecture - something is off the mark. So just admit your kid isn't that cute, and find what it needs to make it more attractive.

• The Story. Sales reps will act to fill a void. They have to - it's the nature of what they do. If you don't give them a story that customers understand, believe and care about - then they'll do whatever they have to do to create that story. If that fails, they'll cut the price. It's sales nature. So get the story right, and work with sales to make sure it works for them and their customers - not just for the citizens at corporate.

• The Target Market. Just because they were your best customers in the past, don't assume they are for this product or time period. Like you, your customers are evolving and changing, following their own Phoenix flight plan. Make sure you're still a match and if you're not - either switch markets or products. Discounting is often a sign that you're aim is a bit off in the market.

• The Trust Factor. If customers don't trust that you're the expert partner they've been looking for, they won't pay you full price. They'll want a discount for the risk they perceive they are taking. Make sure sales has the evidence to demonstrate your expertise and prove relevant successes.

• The Comp Plan. But what if the reps don't lose that much money for discounting? What if they can discount a deal to the point that you lose money - and they still get paid, maybe even slapped on the back for it? If you think it doesn't happen, look around you.

My point is - discounting is a very telling behavior. Here and there, it's not a big deal. But when it starts to happen consistently, then it's time to pay attention and fix the reason it's going on.

And stop immediately assuming sales is to blame. Sometimes it is a management issue, but more often than not they're doing the best they can with what they have been given.

Related Articles
  How to Keep Sales Up In A Down Economy
  Build Value Not Discount To Avoid Becoming A Commodity in Your Industry During Good or Bad Times
  Why discounting is bad for business
  The Dangers of Discounting
  Why Discounting is Hazardous to Your Business

Article Tags: ammunition, architecture, capabilities, commission dollars, corporate citizens, exceptions, human nature, job, love, money, natural inclination, nbsp, place technology, relative truth, sales reps, strong sales, technology companies, technology products, ul, wallets



Related Forum Posts
Online Sales and Marketing vs Traditional - Hi Evan, I am noticing that many of the posts in the Sales/Marketing section deal with online marketing, SEM and and SEO and Affiliates. I was wondering if it might be a good idea to separate that section into two; 1) Online Sales and Marketing; 2) Traditional Sales and Marketing
Re: Online Sales and Marketing vs Traditional - [quote="ltrahan":31w9r2iz]Hi Evan, I am noticing that many of the posts in the Sales/Marketing section deal with online marketing, SEM and and SEO and Affiliates. I was wondering if it might be a good idea to separate that section into two; 1) Online Sales and Marketing; 2) Traditional Sales and Marketing[/quote:31w9r2iz] I second the request...
Hello From Marietta GA! - Hello All! My name is Tim Naylor and I am in Direct Sales! I am glad I have found EC's sites and I hope to learn and share a lot!
taxes in canada - Well in Canada we only have a few provinces and the Sales tax is slightly different. Here in Ontario the Goods & Services tax has reduced to 5% from 7% in the last year due to the promises made by the government in place.
Re: Watch What you Read - I agree. i believe more video's should be like Jeffery Gitomers video's under his Sales rant. They are typically not more than 3 minutes. His model seems to be; 1. Main Message (or Point) 2. Example 3. Next steps to put it into Action take away the extra "blabber" and you've got viewers that will come back.


Share this article with your friends. Fund someone's dream.

Leave a comment below or share on the left and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.

Tweet

Newsletter

Get advice & tips from famous business
owners, new articles by entrepreneur
experts, my latest website updates, &
special sneak peaks at what's to come!

Name:
Email:

Popular Articles

Google Panda and Your Search Engine Rankings

Too Many Sales Reps Are Wimps

Ready for a Fresh Image?

Suggestions

Email us your ideas on how to make our
website more valuable! Thank you Sharon
from Toronto Salsa Lessons / Classes for
your suggestions to make the newsletter
look like the website and profile younger
entrepreneurs like Jennifer Lopez.