By Stefan Christensen – Do you automatically lead with price when you sell? What happens when you bring a product or service to market at the lowest price? Does this hurt or help your bottom line? At the most basic level, business owners may be tempted to look at what competitors are charging, and then price their solutions on the lower end of that spectrum. It’s understandable to want to be competitive and price in a way that does not create a budgetary obstacle for potential customers, but what other implications exist?
Business owners who take the above approach will argue that consumers really only care about price when they are making buying decisions. However, as someone who began their career in sales as a car sales person, I’ve seen examples of the contrary. The automotive market is highly competitive. In fact, manufacturers constantly have price incentives that help dealers virtually give vehicles away. Yet Tesla has managed to be the number one selling car in California with prices ranging from $35K to a hefty $100K. Compare that to most other manufacturers with inventory priced between $18K – $50K. Cars don’t have to be commodities, and neither do the products and solutions you sell.