Latest / Closing Sales in Nigeria - Sales For The Nigerian Business Person: The Sales and Marketing Blueprint / Why You Shouldn't Drop Your Prices (and What to Do Instead)

Transcript

Why You Shouldn't Drop Your Prices (and What to Do Instead) · Closing Sales in Nigeria - Sales For The Nigerian Business Person: The Sales and Marketing Blueprint

0:01
Hello and welcome. My name is Tavishima Aede.
0:04
I'm the host of the podcast that I'm making today's recording at
0:07
home. So there will be noise in the
0:09
background today on the podcast. But when you'll be looking at
0:13
should pricing be an issue when you sell complex products or
0:18
services? Again, the question for today,
0:21
should pricing be an issue when you sell complex products or
0:24
services? Now, the reason why we're
0:26
tackling this question today is obvious.
0:29
I'm coaching a bunch of people and they keep on saying I've
0:32
told my Olga the price, the price, the price.
0:35
So I hear that a lot. And my answer has always been
0:39
that, look, we're sales people, Let's forget this whole thing
0:42
about price. The price has already been
0:45
fixed. The price is beyond our control.
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And the truth of the matter is, if there are other people that
0:51
are selling this product or this service at this price, then it
0:55
means there is a way. So let's just be coming down and
0:59
let's figure out how we can sell this thing instead of saying the
1:03
price, the price, the price. Apart from that, I found a
1:07
natural practice that even when the ogre or Madame reduces the
1:12
price, guess what happens? The next complaint is still
1:17
people are complaining about the price.
1:20
There's a client of mine currently coaching their staff
1:23
again and it's something that they went through last year,
1:28
sorry, the year before people complained the price, the price,
1:32
the price. Our guy said, OK, no problem,
1:34
let's go and look for a cater of products that we can sell within
1:41
the same range but a lower price.
1:43
And they went ahead and they did that.
1:45
And guess what the main complaint was?
1:47
The price, the price, the price. So this thing is never going to
1:54
go away. Salespeople, I'm telling you
1:57
now, you will always meet someone who will say you are too
2:00
expensive. Even if you know that you're the
2:04
cheapest in the market, people will still complain about the
2:07
price. This price thing is never going
2:10
to run away. So that's why we're looking at
2:12
the question, should we be saying that price is an issue
2:19
when we sell complex products or services?
2:23
Oh, by the way, if you'd love to connect, you can call, you can
2:25
SMS or WhatsApp me on 08064662140.
2:31
So like I've mentioned today on the podcast, we're looking at
2:34
whether pricing is an issue when we sell accomplished products or
2:37
services. And the reason why we're
2:40
tackling that today is because lots of people assume that
2:42
pricing is a problem. The salespeople assume pricing
2:45
is a problem, and lots of business owners assume that
2:47
pricing is a problem. Now, there are times when your
2:50
price is genuinely too expensive, but that's a separate
2:54
podcast episode. But lots of times the price,
2:57
it's not really the issue, but it's also an interesting
3:00
dynamic. When people assume that price is
3:03
the problem, what do they want to do?
3:05
They want to reduce price. And this creates A downward
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pressure in this particular sales situation that you're in.
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Because let's face it, the average person wants to do
3:16
business in Niger is talking to two or three vendors, two or
3:19
three service providers and the person has three quotes.
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So you're quoting 15, the other people are quoting 14,
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Somebody's quoting 1/3. The person tells you, yeah, but
3:32
I have this quote for 1/3. So what do you do?
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You try and drop it to 1/3. The other person drops it to
3:38
213. Maybe one person tries to be
3:40
ambitious and they drop it to 1250.
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And what do you think the client is going to do?
3:45
Potential client is going to go and I say I found another quote
3:48
for 1250. So you see how it works.
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You're now creating downward pressure on price.
3:57
You've now engaged with the price war that you don't know
4:00
about. And truth of matter is that
4:02
nobody wins this price war, nobody because the person who
4:05
drops margin to the least price to the least, the person is
4:09
reducing their margins. You are eroding your profits.
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Business is really hard enough as it is.
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And let's be honest, how much are you making on one product
4:19
per one that you're selling? So the margins are tight enough,
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you're already dropping the profit, the margins even more.
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Nobody wins in a price war. Nobody.
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So no point starting it, no point taking part in it.
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And see, this is even the funniest thing about price wars.
4:40
When you get into a price war and you drop your margin, you
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now have to sell harder. At the end of the day, you need
4:47
to get more customers to make a living.
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In fact, those one particular case study, I can't remember
4:53
because I heard it on a podcast, but the consultant I was working
4:58
with them, the guy did the math for them.
4:59
The guy brought a board for them, things on YouTube I should
5:03
try and remember, and the guy calculated everything.
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So, OK, look, all of you are salespeople happy I say yes.
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So all of you, if all of you decide that let's give these
5:12
people 5% discount, what will happen?
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They couldn't answer. So the guy did the math.
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He did it 5% discount each person.
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To make up for that 5% discount, each person now had to sell 33%
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more. Hope you guys hear what I'm
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saying. Each person now had to sell 33%
5:33
more to make their quota. Sorry, not to make their quota.
5:38
Asking to make the level of Commission that is OK for them.
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So in other words, in your head you already calculated a certain
5:47
amount of money that is good for you, that is good for house
5:51
rent, that is good for school fees, that is good for Internet,
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that is good for every everything you need.
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You have that amount comfortable in your head.
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To reach that amount, you have to call a certain number of
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customers. So if that amount is, let's say
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one M is that amount and on each customer you're getting 100K
6:13
profits. It is all simple mathematics
6:15
that you need to sell 10 people and once you sell that 10 you
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have one M in your pocket. You now know that.
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OK, this month is settled. I'm worried about next month or
6:25
next quarter. No, let's say next month there's
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nobody that can spend 1,000,000 in 1/4.
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It's as unrealistic. Cost of living is too high.
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SO1M for this month I'm sorted. By the time you start
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discounting everybody 55 percent, 10%, you're moving 10K
6:45
on each person. You're only collecting 90K per
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head. You now have to sell some extra
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people to now meet up with that one M that you need at the end
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of the day. So that's the funniest thing,
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that by dropping the price now, you're increasing your work in
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the future. You're giving yourself future
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headache, serious headache. Because sales is hard.
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Selling 10 people was hard enough as it is by dropping the
7:10
thing, the price. Now see, I'm not good at math,
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so I can't do it, You know, I don't know what The thing is,
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but by dropping it, collecting 1990K, you don't have to sell
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some extra people to meet up without one M Selling 10 people
7:21
was hard, and you're doing the thing that will now give you
7:24
extra heads that you need to sell so that you can make up on
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the margin that you've lost people.
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I'm not explaining this incorrectly, but the example
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that I saw because Alton did it on this case on the whiteboard
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is very, very simple. OK, Well, not simple because we
7:38
need to know some math. I mean, I don't know math.
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When I saw it, everything really expanded my eyes.
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I say what? I give somebody 5% discount.
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Because of that, I need to sell 33% more.
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In other words, if before selling 100 people would have
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gotten me to my goal, I would now have to sell 120 something
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people or 130 something people to not meet up with my goal.
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That's some serious headache by giving yourself.
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So honestly on this price thing, nobody wins.
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So for those of you who are responsible for selling the
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price is the price, just leave it.
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Is somebody selling at that price?
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1 moment. OK, I'm back.
8:28
Sorry about that. We've been having some really
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wonderful weather in Abuja. It's been raining almost every
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day for the last week or so, and the rain has started again, so I
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needed to go close the windows. All right, so where was I?
8:44
OK, now I was in the middle of explaining how when you drop the
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price because you think you're trying to close this deal, now,
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you don't realize that you're giving yourself extra headache
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for the future because you already have a target for the
9:03
week, for the month, for the year.
9:07
And that target demands that you talk to a certain number of
9:09
people. When you reduce the amount that
9:13
you're collecting per head, you are increasing the number of
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people that you have to sell. So selling is hard, but they put
9:22
it this way. If you had a choice, as I mean
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you are capable enough to sell four people at 250K each to get
9:31
one M or to sell 1,000,000 people at one naira each to get
9:39
one M, which would you prefer? Let me repeat, four people at
9:45
250K each to get one M, the other one sell 1,000,000 people
9:50
one naira each so you can get one M.
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That is the kind of basic I'm talking about that you are
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putting yourself in that you don't realize you're giving
10:01
yourself extra work. So selling is hard, you might as
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well go through the trouble of selling to four people and make
10:08
your quota than to sell multiple number of people to make your
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quota at the end of the day, well profit margin.
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And if they move on from this, because I know that somebody who
10:18
is good at mathematics with having a look guy, your numbers
10:21
are wrong. So yes, even if my numbers are
10:23
wrong in principle, what I'm saying is correct.
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By reducing the price, you are increasing the amount of work
10:29
that you have to do in the future.
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Now let's see, OK, so is price the only factor that we can
10:39
tweak now when we're trying to close a deal or we're trying to
10:42
make a sale? Because you're talking to
10:43
someone, it looks like this thing is neck and neck.
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You know, if it be you might be you, it might be somebody else.
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And say, you know what, if you pay now, I give you 5% discount,
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is price the only thing that you can tweak, the only thing you
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can drop, the only thing you can adjust, the only thing you can
10:59
make concessions on, the only thing you can push forward.
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Is it only price? The answer is a capital NO.
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But before we go into some definitions, let's talk about
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what complex sales are first of all, so that those of us who are
11:13
listening will now know whether we fall into this complex sale
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or not. So what is a complex sale?
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The complex sale is when your product or your service has any
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one of the following, what will I say?
11:28
Features or characteristics, so #1 what you're selling is
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complex. Complex just means the things
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has many parts. Your solution or your service
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has many parts. That's what makes it complex.
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So selling a Gucci, like I'd like to say on the podcast is
11:45
simple because how many parts are there to a Gucci?
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Not that many. Everybody knows what a Gucci is.
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Number 1, you can see it on sight #2 the thing has to be
11:55
fresh. If you see it and the thing has
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some black, black color in it, it means that The thing is no
11:59
longer fresh. It's not going bad.
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Then what else? So you can see just two
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features. It has to look right.
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The thing has to be fresh. If it is, and let's not pricing,
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you see, it's not complex, but it's sending a car.
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On the other hand, now that's complex because there are many
12:18
moving parts you have to consider.
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Is it Toyota? Is it Corolla?
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So is it Toyota? Is it Mercedes-Benz?
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Is it Mazda? Which year was it?
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Is it fairly used? Abby is brand new for the fairly
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use, is it fairly use UK or fairly use America or is it
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fairly use Niger? You can say the number of things
12:37
that we're beginning to consider, many and many and
12:41
many. So considering some things like
12:47
commodities, Agusi, Gary Groundnut, it's relatively
12:55
simple. Buying a car, you can see it's
12:58
getting more and more complex because one has the number of
13:04
things you have to consider and the number of moving parts that
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put together to make this thing a deal.
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The number of moving parts are more.
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So is this simple or is it complex?
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The more parts you have, the more complex your thing is, the
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closer you are to being in the complex sale.
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The next we have to consider the price.
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Typically complex sales turn out to be more expensive.
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So agusi doesn't cost much. OK, well agusi it does cost
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much, you know, because of hyper inflation.
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But relatively speaking agusi doesn't cost that much.
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Meat doesn't. OK, well meat cost that much is
13:41
7 five per kilo, but you get the point relatively speaking.
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But then the car on the other hand, it's been a while since I
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asked. The last time I asked, I heard
13:51
that if I was going to get my own current version of the car
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that I use now and it's second hand was to buy it in the market
13:57
that half dropped between 11 and 14 M So you can see the price
14:02
goes up. So real estate houses,
14:06
expensive, What else? So you can see as the price is
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going up and up and up, the more complex things are getting.
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Then relationships. There are some relationships,
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there are some industries that relationships are required to
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close the sale. If you're in one of those
14:28
industries where relationships are really important, then you
14:32
are in a complex relationship. So real estate, for instance,
14:35
yeah, there's some complexity involved because people don't
14:38
just walk up to strangers and then just give them money like
14:40
that. People like to get to know each
14:42
other, do some research, you know, things like that.
14:44
Establish one or two relationships before you drop
14:47
money. So relationships are important
14:50
to closing the deal in real estate.
14:52
Relationships are not that important to closing the deal.
14:55
If you go to the market and you want to buy.
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So yeah, or you want to buy a Gucci or you want to buy beans.
15:03
So the more relationships are required, the more the complex.
15:08
The scenario that you are is another reason why relationships
15:15
are required in complex hill scenarios, because it's a form
15:18
of risk mitigation. Like I said in the real estate
15:20
thing, I want to know this person, what kind of person is
15:24
this? Is he a correct person?
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Does it sound shady? Does it sound shifty?
15:29
So it's a form of risk mitigation.
15:30
Building relationships. You're trying to size people up
15:33
before you drop money. Trust becomes an issue and then
15:37
also competency becomes an issue.
15:39
They're trying to feel people out.
15:40
Are they competent? Are they credible?
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Does it look like they can do what they say they're going to
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do? Does it sound like they can do
15:46
what they say they're going to do?
15:47
Do they have a history of doing those sorts of things?
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These are the kind of things that people try and source out
15:53
when they're in relationships in a complex sale.
15:57
Then sales cycle, complex sales cycles, sorry, complex sales
16:01
scenarios usually have long sales cycles.
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The sales cycle just mean the time between when you say hello,
16:07
when you say what's up and when you now collect your money.
16:11
So a goosey sales cycle is very short. 5 minutes.
16:16
You walk through the shop. Madam, how long time, how have
16:19
you been blah blah. How your children?
16:22
This economy got the help. Also you get a goosey.
16:26
How much is it? 5000 per cup?
16:29
Madam, Last time I came here you said it was 35 per cup.
16:32
Now you're saying 5. Hi Madam, why now?
16:34
OK, I want to buy 5 cups. Yeah, but you have to drop.
16:39
You have to reduce money for me, man.
16:41
Instead of that 5K for per cup, let me pay for two.
16:45
Then you have back and forth. But you know, tops 5 minutes.
16:48
You're done. Maybe 10 minutes.
16:51
If you're like my auntie, one of my auntie, she can price for
16:53
Africa. You spend 30 minutes in one
16:56
spot. I really hated going to the
16:58
market with her when I was a kid.
17:00
Because we'll go to the market 8:00 in the morning.
17:04
We'll leave the market until 2:00 in the afternoon.
17:06
Like what kind of madness is that?
17:08
And I'm the one that will be carrying the bag, spending 13
17:11
minutes pricing one person. Some people are terrible when it
17:15
comes to pricing. Where was I?
17:20
So that sales cycle. But now when it comes to buying
17:23
a car or to buying real estate, the sales cycles are longer.
17:26
Somebody will come, he'll look at the car, he will test it.
17:28
Let me think about it. Come back again, call you one or
17:30
two times. So bottom line, somebody comes
17:33
to look at the cars you're selling today, January 1st, it
17:36
might be until maybe like January 28th before the guy pays
17:40
longest sales cycle. Then the risks that are involved
17:45
in complex sales are usually more costly.
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If you buy a bad batch of a Gucci, what do you do?
17:51
You just throw it out and you go and buy a new one.
17:54
When you pass by the market again, you're harassed.
17:56
Do my same Madam, you showed me by the Gucci.
17:59
You might be able to guilt trip her so that she can give you
18:02
some some more of this one this time for free.
18:06
But when you make a mistake in simple sales, it's not that
18:11
costly. But in complex sales, if you buy
18:13
a car that was accidental, maybe the song was damaged, you didn't
18:17
catch it, but you bought the car.
18:18
You don't have to replace your song or when you're spending
18:20
money. So the risks involved are much
18:24
more costly. And then the number of parties,
18:26
that's also what determines is if a sale is complex.
18:30
So in simple sales, you're usually talking about one or two
18:33
people. So going to go and buy a Gucci
18:35
is just you and woman 2 of you going to go and buy a car.
18:38
On the other hand, you know you will talk to your friend, you
18:42
will talk to your wife, you talk to some people at work, you will
18:46
bring your mechanic. You can see that number of
18:48
people is beginning to expand to buy the car.
18:50
Now like 4 people are involved. If a man is buying the car, so
18:55
this man, his wife, then his friend, and then this mechanic,
18:58
you know 4 people. And then as you go up and up and
19:00
up, the complexity of increases. So these are the factors that
19:06
determine whether you are in a simple or a complex sales
19:11
scenario. The reason why I was splitting
19:12
it up is because when you're on a simple sales scenario, price
19:16
now assumes a different dimension.
19:17
Because in simple sales scenario, like you're selling
19:19
commodities, well, unfortunately price is more important there.
19:24
So you know you will price and well, you know you price
19:29
whatever can price the best win. But then when you're in complex
19:32
sales scenarios, it's not that simple.
19:33
It's not just the price because remember we spoke about price as
19:37
one factor, but then we also have to consider the complexity,
19:41
consider relationships, consider the sales cycle, consider the
19:45
risk and consider the number of parties.
19:49
So you can see that there are lots of things that we have to
19:51
play with when we are in the complex sales cycle.
19:53
So if you sell banana and groundnuts, then your situation
19:57
is effed up because price is the only thing you can play with.
20:04
If you can price well, you will stand your ground.
20:06
If you can't price well, you know people, people will ride
20:10
you. You can do some smart moves like
20:13
there's a lady who sells bananas and what she does is.
20:18
Every day outside my wife's office, the lady is there with
20:21
her tray and the bananas are always clean, like they look
20:26
like wonderful, like shaped from Indonesia or someplace always
20:31
yellow looking like the bananas, you know, like they bath with
20:35
truer soap or something, like very clean.
20:39
And the woman sells out quickly, quickly.
20:43
Like one hour. She has sold every single thing,
20:47
but The thing is she's there every single day.
20:51
So that woman, you know, she's smart.
20:53
So all I put it because it's good.
20:58
Bananas is fresh bananas, no wound, no stain, very clean.
21:05
She's in front of the office, so high traffic, you know.
21:08
So for highs, either you buy or you don't buy.
21:12
So yes, people who are involved in commodity businesses that are
21:15
some things that you can do. But generally speaking, if you
21:18
are in a simple price scenario, well, you know demand and
21:22
supply, the price is the price. But if you're in a complex sale
21:24
scenario, there are other things.
21:26
Remember the complexity of the product itself, we can play with
21:30
that. The price, we can play with
21:32
that. Relationships, we can play with
21:34
that. The sales cycle, we can play
21:36
with that. The risks involved, we can play
21:38
with that. The number of parties, we can
21:40
work with that. There are a number of things
21:42
that we can work with when we are in complex sales scenarios.
21:46
So you don't always have to drop the price.
21:49
You are not selling banana and groundnut.
21:54
So let's look at examples of industries in Nigeria that have
21:59
complex sales scenarios. So obviously, let me start with
22:02
oil and gas because that was my second degree oil and gas.
22:07
So oil and gas is very complex because you have different
22:10
stakeholders now, lots of people in the decision making unit,
22:15
lots of people you have to consult before you close the
22:17
deal. So oil and gas, depending on
22:19
what you sell, sometimes you talk to engineer, sometimes you
22:22
talk to procurement officer, sometimes you talk to the
22:24
finance executives, sometimes you talk to MD managing
22:27
director. Everybody has their own
22:29
different priority. Everybody has their own
22:32
different technical specs that they need you to make and to
22:34
meet. Everybody has their own budget,
22:38
everybody has their own return that they're looking at.
22:40
So you can see that if you're in the oil and gas space, it's
22:42
complex because they have different stakeholders.
22:45
Then of course, you know the price.
22:47
The thing is high value in oil and gas, everything we're
22:50
talking about is millions of dollars, not millions of naira.
22:54
Everything is millions of dollars.
22:56
So the financial risk is high. Then long sales cycle because
23:03
you have to do technical demonstration, you do due
23:05
diligence, there's competitive bidding, you know, contract
23:09
negotiations, you know, sometimes this thing can last,
23:11
you know, 8 months, nine months, one year, two years.
23:16
And of course, after sales support is something you can
23:18
throw into, you know, sweeten it.
23:21
But since it's not just about the equipment, then after sales
23:24
support becomes important in in this situation.
23:31
So you can see that if you're in the oil and gas space, you're in
23:35
a complex sales scenario. Don't be focusing so much on the
23:38
price. There are other levers that you
23:41
can pull on. If you're in good terms with
23:48
multiple stakeholders, you might be able to maintain your price.
23:52
You'll be able to demonstrate good return on investment, what
23:56
people are getting for their money.
23:57
You might be able to maintain your price.
24:00
If you realise that this is a long sales cycle and you play it
24:03
out the best that you can, you might be able to maintain your
24:06
price. So that's one oil and gas.
24:11
So all of you that are in oil and gas, you're in complex hill
24:14
scenarios. Then telecommunications, you
24:19
know, MTN and all that, mobile Internet technology, Internet
24:26
connectivity, all those things that is complex because you're
24:30
dealing with different stakeholders.
24:34
If you're selling into a business, you have to talk to
24:35
the chief information officer. The CFO might want to know also
24:39
chief financial officer, the compliance department, they need
24:43
to be brought into this deal as well because nobody wants to buy
24:48
something that does not integrate with the systems that
24:51
they already have or that you will now run into some
24:55
compliance issues from a legal standpoint.
25:01
And then you also have to worry about regulatory requirements.
25:05
So like Central Bank of Nigeria, for instance, for banks who have
25:08
some kind of requirements for the solutions that you're trying
25:10
to sell. So you have to worry about these
25:13
sorts of things. So it's complex.
25:16
Healthcare and pharmaceuticals that is also complex because the
25:19
person who is selling there, the person needs to have specialised
25:21
knowledge. You need to understand the
25:23
medical fields, you need to understand the specs of the
25:26
drugs that you're selling or the equipment that you're selling.
25:30
You need to understand all these things.
25:31
Reputation and trust becomes an issue.
25:35
And of course construction there's that's also a certain
25:38
level of if I there's a lot of complexity that is involved
25:43
there. So you see, these are some of
25:45
the industries that if you're involved in, you're in a complex
25:49
sales scenario. But the thing to note is this,
25:52
that when we say complexity, complexity and simplicity is a
25:55
scale. So things get more complex and
25:58
more simple. But you can't say this thing is
26:00
complex, this thing is simple. For instance, accounting
26:03
services. Is that simple or complex?
26:05
It depends. If you're talking to one person
26:10
and it's just for bookkeeping services and the person is a
26:12
simple sole trader, well, maybe that's a simple sale scenario.
26:17
But if you're trying to sell accounting and auditing services
26:21
to a bank or to a government, OK, no bank already have their
26:24
own to a government parastatal. So you think they're getting
26:27
more complex? So accounting services, is that
26:29
simple or complex? It depends.
26:32
Legal services, it depends. Could be simple, could be
26:36
complex. Solar installation, it depends,
26:39
could be simple, could be complex.
26:41
In fact, I'll say solar lots of the time, I'll say is mostly
26:43
complex. It's just that sometimes you're
26:45
dealing with somebody who's really, really paid up and can't
26:48
be hassled. So in that particular situation,
26:51
it might come off more as a simple sales scenario.
26:54
Weddings and event photography, is that simple or complex?
26:57
It depends. Event catering, simple or
27:00
complex. Commercial cleaning services,
27:03
cleaning people's house, cleaning people's office.
27:04
Is that simple or complex? It depends.
27:07
But just think of it as a scale. Things can get more complex,
27:11
things can get more simple. So everything has levels of
27:15
complexity. But the first set of industries
27:18
that I mentioned, those ones are always complex.
27:20
There's no oil and gas whatever. That is simple.
27:23
None. Now when you sell in these kinds
27:26
of environments in complex hill scenarios, what are the
27:29
different things that you have to play with apart from price 1
27:32
is I already mentioned it, the return on investment, what are
27:36
people getting back or the business impact or your value
27:39
proposition. As a very powerful level, the
27:42
idea behind value proposition, return on investment or business
27:45
impact is if you're dropping X amount of money, you are getting
27:50
Y&Z benefits in return. You have to be able to make that
27:53
kind of argument when you are in a complex hill scenario.
27:58
Like when it came to buying cars, buying my first car got a
28:01
Toyota was, you know, I looked at some brands that were
28:05
cheaper, but the guy said bro, yes, these cars are cheaper and
28:10
it was a matter of, you know, just money.
28:12
I'll say and bring it and take it.
28:15
But the thing about Toyota is that Toyota has resale value.
28:20
So why not just take the Toyota even though you pay more?
28:24
But The thing is when you're even ready to sell, you can even
28:26
come back to me and I'll even be able to buy from you because
28:29
Toyota has resale value. And when I look at it like that
28:32
was one of the things I discussed with my wife, I said,
28:34
look, you know what, these are our brands.
28:36
We can buy these brands or cars cheap.
28:38
But what this guy is saying about resale value and then
28:41
maintenance be like everything is making sense.
28:46
So there was some value proposition, there was some
28:49
return on investment, there was some financial impact or
28:53
business impact or some kind of impact conversation that was had
28:56
in that case. So when it comes to complex
28:59
selling scenarios, you should not just be looking at price.
29:02
You can be having value conversations and impact
29:05
conversations that yes or guy, I'm asking you for one M but is
29:09
1 M by the time you pay it. This is the value that you're
29:11
going to get for this one M. You can and you should be having
29:15
those sorts of conversations. Financial impact.
29:18
This thing I'm selling you. This is how it will increase
29:20
your revenue or this is how it will make it easier for you to
29:23
run your business or this is how it will make you much more
29:25
profitable. Be arguing those things.
29:30
Don't just say OK orga just OK instead of 1.2 just just bring
29:37
1.1 or just bring one M Don't just be so quick to drop your,
29:43
you know, don't be exposing yourself anyhow.
29:46
Argue the value. So there's financial impact.
29:50
This will make you money. In some cases.
29:52
There's operational efficiency. It will make it easier for you
29:55
to do XYZ. Then we can also play with
30:02
relationships and then build trust.
30:04
Complex sales are built on trust.
30:06
Let me repeat, complex sales are built on trust.
30:10
You can play with the trust. We can play with trust no more
30:14
by building consensus. Consensus just means we're
30:17
talking to multiple people within the account, which is why
30:20
I keep saying that when it comes to complex sales, some of you
30:23
are single threaded. It's a bad idea.
30:25
Single thread means you're only talking to one person in the
30:27
account. Nigerians, we already know this
30:31
kind of thing that if you want to get, you know, maybe your
30:35
uncle is in State House and you think you can get the contract.
30:40
If your uncle is the only person you're talking to, you, you have
30:43
lost, you should be talking to your uncle, you should be
30:47
talking to chairman of the House, you should be talking to
30:50
chairman of the committee. You should also be talking to
30:52
somebody in the state office for procurement.
30:57
You know, the more people you're talking to, the easier it will
30:59
be for you to secure this contract.
31:01
You don't just say my uncle is on the inside, let me go and
31:03
sleep. No, even along party lines you
31:08
don't just talk to OK, your uncle is within the ruling
31:11
party, so you now go and sleep. The more people that you talk
31:14
to, the better. Build consensus, get lots of
31:19
people to trust you. The more people that you talk
31:23
to, you'll be able to figure out who is interested, what are
31:26
their motivations, what is their interests?
31:28
Who can I schmooze with? Relationship trust?
31:34
We can play with that. Then there's also customisation.
31:38
That means you just tailor the solution to fit this particular
31:41
situation. Somebody can be saying one M is
31:43
too expensive, I guess. OK, well, you know what?
31:46
Bross is true. One M is on the high side.
31:50
Things are expensive these days. Yeah, I get you.
31:53
But The thing is this one M, these are the outcomes that
31:56
we're trying to give you and these are all the features and
32:00
the whatever that we've thrown in.
32:01
But however, pricing is not much of an issue.
32:03
It looks like we can remove this element and we can remove this
32:06
element, it will still solve your problem.
32:08
And if you bring it within this budget that you've spoken about.
32:11
So Bros, what do you think about that, Madam?
32:13
What do you think about that? That is customisation and that
32:16
is trying to tailor the solution because when it comes to complex
32:20
sale scenarios, it's not one-size-fits-all.
32:25
So solution design as some people call this is very, very
32:28
important. This solution that we're trying
32:30
to provide for the product or the service, how can we design
32:35
it so that if it's this exact person's needs, that's one of
32:39
the ways that we're controlling the, the, the, the conversation
32:42
around budget. That's what I've said in the
32:45
past, that as salespeople we should not be making on
32:47
principled concessions. And on principled concession it
32:50
does means this. If somebody asks you for
32:52
something, you say OK, That is our principal concession.
32:56
What we should be doing is we somebody ask you for something,
32:59
ask for something else in return.
33:01
If somebody says drop this price from 1.2 to 1.1, you can say,
33:05
OK, you know what, I'll drop it from 1.2 to 1.1, but then I'll
33:10
need you to help me. I can't go back to my organ and
33:13
say that I dropped this price to 1.1, maybe only bought one.
33:17
If I'm dropping this price to 1.1, you should help me and buy
33:20
4 instead instead of 1. See, that's an that's.
33:25
That's not an unprincipled concession.
33:27
The president asked for something.
33:28
He asked for something in return.
33:29
Now, the good thing about this habit is when you get into the
33:33
habit of asking for something, every single time they ask you
33:36
for something, guess what happens?
33:39
People will stop asking you for things.
33:42
I've seen this one first hand. By the time people asked me to
33:48
drop my price and I said OK, cool, no problem, we can do
33:50
that. We can drop the price, but we
33:52
have to now take out a couple of elements.
33:54
Which element would you like to remove?
33:56
By the time we do that two or three times they stop asking me
33:58
for stuff because they have seen the handwriting on the wall.
34:02
And I learned that from my wedding photography days.
34:05
They've seen the handwriting on the wall.
34:06
Every single time I establish him how to drop something, he
34:09
too want to drop something. By the time to remove price, he
34:12
wants to drop something and so they stop playing those games,
34:16
stop giving on principle concessions.
34:21
Now this whole thing of customizing sometimes it also
34:24
means you can be give some some flexibility when it comes to
34:28
payment terms. You can say, you know what, this
34:32
1.2 I can't drop it to 1.1. But what we can do is that for
34:36
you to take possession and bring 80% now the remaining payment
34:39
terms will start guide at so, so, so percent over the next
34:42
three months while I talk to you guys.
34:43
See that is OK for you see that's flexibility in payment
34:48
terms. We've kept the price.
34:52
We're trying to make payment terms easy for them.
34:56
Sometimes implementation is not just contract terms,
34:59
implementation terms, when are we going to start?
35:04
So it depends. We can play with that instead of
35:07
dropping price all the time. Then social proof, credibility,
35:13
that is also something that we can play with.
35:16
Social proof just means people outside live in the field.
35:22
They're already using this product, already using this
35:23
service. These are the results that
35:25
they're getting. So come and see for yourself.
35:28
Taste and see that this boy is good.
35:32
You don't have to be afraid doing business with me.
35:34
That is social proof. Last year we dealt with 50
35:38
customers, all the 50 customers that we did, 47 of them gave us
35:43
five star ratings. Come and see our Google profile.
35:47
See everything here. In fact, out of the 4732 are so
35:52
impressed that they sent us video testimonials.
35:54
Madam, this is my phone. See see my WhatsApp, see them,
35:58
see them, see them. Let me play this one for you.
36:00
In fact, Madam, this one was in a similar situation as you.
36:03
Let me play her own. Instead of going straight to
36:07
drop price, play up social proof.
36:10
You're trying to show their your credibility.
36:12
You're trying to tell them taste and see that this boy is good
36:18
taste and see that my product is good taste and see that my
36:21
service is good taste and see that this girl is on point.
36:25
That's what you're telling them. Social proof, case studies,
36:30
testimonials, all these things are very, very important.
36:35
That's why we should try getting these things from people.
36:41
References, word of mouth, endorsements.
36:48
In fact, by the time we're done with Madam So our souls wedding
36:52
Madam Casey was really really Madam Casey.
36:54
Which Madam and Casey the same one that you know, ma'am, in
36:57
case you were before really. She said she was impressed.
37:00
No, I'm telling you, ma'am, I'm serious.
37:02
The fact she said that if that she wouldn't mind talking to any
37:07
of her friends. In fact, after we leave here,
37:09
I'll Call My Name and kitchen so that she can talk to you.
37:13
That's testimonial there. That's word of mouth.
37:17
Those are some of the small, small tricks that some of us
37:20
used to play in the wedding space.
37:25
So very, very important. Then you can also play up your
37:30
industry expertise. That is what I am doing with
37:33
this podcast. I'm trying to to play off my
37:36
expertise. I'm trying to position myself as
37:39
a thought leader. When we will see as a thought
37:45
leader, see Nigerians will price everything.
37:48
But The thing is at least when you're a thought leader, the
37:50
level of pricing will is different.
37:55
So I'm not happy that I'm at the stage where when it comes to
37:59
pricing, it's not like before that somebody will not be
38:01
calling. The difference will now be 100
38:05
grand or something like that. So people will always price.
38:09
So yes, I have to sometimes get away with dropping 25K here, you
38:13
know, 30K here, 10K here, you know, that kind of thing.
38:16
While this is not like before, when starting off a wedding, in
38:20
the wedding and event space, you give the person a bill.
38:23
You say your bill is 400, they say what?
38:27
250 is all I have, so people don't price me that much
38:30
anymore. So if you can build up some
38:34
industry expertise, please do. It helps.
38:37
Your pricing will still be there, but don't be pricing you
38:39
like Groundnut so well. For me it's podcasting, public
38:48
speaking, webinars, conferences. Let people be seeing my face.
38:53
Let them hear my voice for you. Do it in the way you can.
38:57
If it is something as simple as you show up on your Instagram
39:00
every single day and you answer customer questions, even that
39:03
you're showing you that, you show people that you have the
39:05
authority. OK, let's go back to this
39:07
groundnut thing. Let's say you make groundnut
39:10
milk for mothers who can't like it.
39:16
Let's say, hey, let's say that's your business.
39:18
You want people to stop pricing you.
39:19
Anyhow, every single day go on your Instagram Live and answer
39:23
questions. Hello, my name is Cami, the Cami
39:28
the milk booster and today I'm making a video to respond to
39:32
questions that mothers have. The more question is truly, can
39:36
taking groundnut milk help in improving lactation?
39:40
Yes, it can because the World Health Organization says that so
39:43
so so and so different cultures also say this how some people do
39:47
this, Yoruba people do this blah blah blah blah blah.
39:49
Apart from that, groundnut has the different Groundnut has a
39:55
different vitamin, this different, this different, this
39:57
different that blah, blah, blah, blah, blah.
39:59
In fact, apart from lactation, these are the other benefits why
40:03
you should be using groundnut milk, not just as a milk
40:07
booster, but also because of the health benefits they will
40:09
provide to your baby. Thank you very much for
40:12
listening. I'm going to be back tomorrow to
40:14
answer another question. Until then, it's your girl Kemi,
40:18
the milk booster. You end the video.
40:21
Just keep doing that everyday. The mothers who are watching,
40:25
the potential mothers who are watching and who want the best
40:27
for their baby, they'll say that this Commission knows what she's
40:30
saying. When it comes down to pricing.
40:32
If you tell them that 15 litre keg of your, of your groundnut
40:40
milk is IS35K, even if they are pricing, you don't say 35 K,
40:47
please, we take 22 could be the thing that you say 35 K, they'll
40:52
be saying, I beg, can you take 33 K for one?
40:55
I want to buy 5. So you don't have to do
41:01
something as fancy as a podcast like I am doing, but there are
41:04
ways that you can build expertise in whatever industry
41:07
that you're doing. And you see, I just picked this
41:09
random case of lactation. Well, the reason why I picked
41:13
lactation actually is because they actually are people who do
41:16
that. I mean, when we, our kids are
41:18
much younger anyway, I used to be in this world, Let me put it
41:23
this way, as a concerned parent, you see all kinds of things and
41:25
you're worried about all kinds of things because my baby eating
41:27
well is my baby healthy, you know, blah, blah, blah, Basha,
41:30
you can show some kind of expertise.
41:33
So there are things that you can play with that will even stop
41:37
people from pricing you like Groundnut every time that they
41:39
see you. And then another thing that we
41:44
can do is service and support. You can say, oh look, you know
41:47
what, 1.2, that's the price. 1.2, we can't drop the price.
41:52
But however, as a token of our support, what we can do is we
41:57
will give you one or two extra services.
42:01
Somebody has just done on me before.
42:03
That's the second investor that I bought.
42:05
That's what the guy said. The guy said look bro, you know
42:07
the price is the price. The only thing I will do for you
42:09
is the first servicing is supposed to be on year 1.
42:13
So that year 1 servicing, I will do it for you for free.
42:17
Then after that, the next servicing will be 6 months
42:19
after. That's six months after
42:21
servicing, I will do it for you for half cost.
42:23
How do you see it? That's OK, no problem, let's go
42:26
ahead. So you see he kept his price,
42:29
but he say year 1 servicing for free.
42:33
Then the next six months servicing, we'll do it at half
42:35
cost. The other servicing that we're
42:37
doing, you pay me the full price.
42:39
So, and this is the price, I know some of you say he kept, he
42:44
gave money anyway. Anyway, let me just leave it.
42:48
I'm just trying to say that look, there are ways that we
42:50
can, we can look at this thing even if he gave up margin, he
42:56
didn't give margin on the system itself, the expensive 1, he gave
43:01
margin on the servicing end of it.
43:06
So service and after support or the after sale experience, we
43:10
can play with that. So, OK, this is almost 45
43:16
minutes, let me just bring this thing to a close.
43:19
The point I'm just trying to say is this, if you're in a simple
43:22
sale, if you sell banana and groundnut, you are in a tough
43:25
situation and I sympathize with you because nowadays that in
43:29
Abuja bottle of groundnut is 2K25, you know, I feel for you
43:34
because unfortunately the price is the price.
43:36
I mean, how much did you buy it that you don't want to sell it
43:41
and put your small margin on top?
43:44
You know, if you drop your price, you're in a bad
43:47
situation. So I feel sorry for those of you
43:48
who are selling in simple in simple sales scenarios.
43:52
But for those of us who are in complex sales scenarios, we can
43:55
stand our ground. And I have discussed a number of
43:58
things that we can do to help us stand our ground.
44:01
We don't always have to drop the price because remember, when you
44:10
drop your price, you're making things unprofitable for you.
44:13
Your margins are going down and you're creating more homework
44:17
for yourself because you have to sell more people.
44:20
In fact, this is even the biggest problem for me.
44:27
When you drop your price, you're giving your competition the
44:31
opportunity to shine because when you drop your price,
44:33
there's somebody who comes and the person sells on value.
44:38
The person will now look like the experts.
44:40
Those of you who are dropping the price, you will now look
44:42
like the cheap. Anyhow.
44:43
Anyhow, people as was part of all this and there's one bid
44:48
that I lost. This was in Kano.
44:50
I won't call the organization. You know, I called the lady up
44:53
and you know, she said it, that I dropped the price so much that
44:57
they could tell that I was not going to fulfill it myself, that
45:00
I was going to get somebody local to do it and they were
45:02
worried about quality. Man, nothing was a slap in my
45:06
face. I have.
45:07
That was the first time that I lost a bid because I was too
45:10
cheap. I say so you actually can lose a
45:13
bid because you are too cheap. If anybody had told me, I would
45:18
have said is a lie that I can't happen.
45:20
But it has happened to me. I have lost a bid because I was
45:23
too cheap. Now I do some business with that
45:28
organization and the difference is clear.
45:33
Yes, they complain that I'm expensive and the last time I
45:38
worked with them I know that I was the most expensive bid but I
45:41
still maintain them. Especially since you know like 6
45:47
years ago that once they gave me that slap to my face.
45:49
They say man, you lost it because you are too cheap.
45:52
So if you didn't know, know now you can lose a deal because you
45:55
are too cheap. You're so cheap they don't see
45:58
value in this thing. Again, it can be so cheap that
46:03
you're an unattractive partner at the end of the day anyway.
46:09
It doesn't mean that if you're the most expensive that you're
46:13
the most professional optional it.
46:16
It doesn't mean, but I'm just saying beware, you can drop your
46:19
price so low that you end up being the unattractive partner.
46:25
So think about it. I know that there are times when
46:31
we are broke, like we are mad broke.
46:35
And so we say, you know what, let me just drop price now.
46:38
Let me just close my eye. At least if I collect this one,
46:42
I should be able to put fuel in the car for at least for like 2
46:46
weeks, 3 weeks at least, at least fuel is sorted.
46:50
So I understand that there are those situations and I'm not
46:53
going to tell you that in situations like that, you should
46:56
stand on principle and say no, I'm not collecting this thing.
46:58
You know, that's for you to decide.
47:00
So, but I know we we've all been there, but this thing is not
47:05
going to last forever. So in those situations, you
47:09
know, I'll leave it up to you, at least if you close your eye
47:12
and you say this new give me one month of fuel.
47:16
Yeah, one month of fuel is still is still something.
47:19
At least you won't have to remove that money from your
47:22
house savings. But sharp think about it.
47:26
If you're on the complex sale, you don't always have to drop
47:30
your price. There are other things that you
47:32
can play with that will allow you to keep to stand the line
47:39
and collect the healthy profit margin that you need because
47:45
times are hard. Nigeria will go through
47:48
hyperinflation. This is not the time to drop
47:51
your margins. If you cannot increase price, at
47:55
the very least don't be dropping your margin anyhow because times
48:00
are hard. You drop the margin now, you're
48:04
increasing the amount of work that you have to do in the
48:09
future. Anyway, let me stop there.
48:13
So that's it, that's all. Remember, if you'd love to
48:15
connect, you can call, SMS or WhatsApp me on 08064662140.
48:22
Thanks for your time and attention.
48:23
I'll catch you next time. Same place in your headphones or
48:26
in your speakers.