The real price of discounting your offer

Tuesday November 3rd, 2015 is a day I’ll never forget.

For the first time in my life, I wake up in Frankfurt, Germany - I’ve got a 1 night stopover on my way to Windhoek, Namibia.

I’ve already missed one flight the day before, and I’m stressed about making this next one. So I buy a train ticket to the airport, hop on with all my luggage, and settle in.

After a few stops, 2 transit police come through the carriage.

They check my ticket, nod, and keep walking. All good. I go back to staring out the window and checking the time.

But a few minutes later… they come back.

Now they’re loitering right next to me. Silent. Watching.

They wait until the last stop before the airport — the doors close behind us — and they ask to see my ticket again.

They tell me I’ve bought the wrong one. My ticket doesn’t include the airport zone. And they’re going to give me a €120 fine.

Panic sets in.

I don’t want to miss my flight filling out paperwork. And I’m an unemployed traveller with no money so it’s going to hurt the hip pocket too.

They lead me off the train and corral me off to one side of the platform.

They demand to see my passport, and I show them. But something feels off.

They start pushing me to pay the fine in cash, even though they’ve got an EFTPOS machine. One of them reaches for my passport, saying they’ll need to hold onto it until I pay.

That’s when alarm bells start ringing.

I keep my passport in my hand — firm. I let them see it, but I don’t let go.

Then I notice something that makes everything click.

One of them is holding a clipboard.

And on it are numbers, stacked vertically.

€120

€80

€60
€40 is circled at the bottom

They’re offering me a “discount” for paying cash.

And just like that, I realise: this isn’t real.
This is a scam.

They run this trick with every unsuspecting tourist they find, and haggle down the price for cash.

I tell them to issue me the fine. I take the piece of paper they hand me… and I bin it the second I get through airport security.

Who knows — maybe I’m wanted in Germany now. But I made the flight.

So what’s this got to do with your business?

Everything.

Because what those scammers were doing is exactly what happens when you discount your services to try and close a sale.

You think you’re being helpful, that you’re increasing your chance of a sale.
But what you’re really doing is eroding trust.

Discounting is a fast-track way to look less legitimate.

It signals to your prospect that the original price wasn’t real. That maybe the value isn’t either. That you’re willing to make concessions before the work has even started.

And once you open that door, it sets the tone for the whole relationship. You subconsciously start deprioritising that client. You feel a bit bummed out, knowing you’re doing the work for less. And that can affect how you show up — whether you mean to or not.

What to do instead - 5 steps to handle objections

In my experience, price objections aren’t actually about the price. They’re about perception of value.

Try these 5 steps the next time a prospect raises price as an objection:

1. Empathy - thanks for your transparency, I understand.

2. Elaborate - could you tell me more about that?

3. Isolate objection - “[objection they mentioned] aside, is there anything else holding you back from partnering with me on this?” [If they do mention something else, go back to step 1]

4. Reframe value - “[objection they mentioned] aside, what do you like most about the offer? This gives you a signpost to where value lies for them.

5. Trial Close - “sounds like you love [x,y,z value they mentioned] - that’s why the [pricing / timing / scope, whatever their initial objection] is that way. With that said, do you feel comfortable moving forward?”

If you work through the process and the price is STILL a blocker, the next step is to offer the option of reducing the scope to fit within their budget. You could say something like:

“Which parts of the scope would you like to remove to fit within your budget?”

Just don’t become the corrupt transit police officer with the clipboard, writing down lower and lower numbers.