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The best marketing advice I ever received…11 October 2011
…Never sell on price!
In the midst of the Supermarket Price Wars, and reading about Sainsbury’s joining the fray, I am reminded of Selling to Win by Richard Denny, sales trainer. His basic rule was “don’t sell on price!”
When you sell on price, you devalue yourself and your product. When you sell only on price you run the risk of coming up against someone else who will produce exactly what you do, but cheaper – and there will always be someone cheaper! Someone will always turn up and undercut you – even if it loses them money to start with.
If there isn’t something else about your product or service that makes someone want to buy only from you, then you’re always going to struggle.
So what is all this Price-War stuff? Surely Tesco, Sainsbury’s and Asda know this rule?
Of course they do.
And anyway, how can they all be the cheapest? Because there is small print. They use terms like ‘comparable’ items. They drop the price on certain items they think will attract customers and hike up the price on others.
Doesn’t it all seem a bit desperate? I know we’re all tightening our belts and the average pound sterling doesn’t go as far as it should, but it all smacks of panic. And it’s going to end badly. When you start selling simply on price at this kind of level, someone goes out of business.
Personally I would prefer it if rather than trying to one-up their competitors, supermarkets would be honest, improve their service and their quality. Standards have slipped across the board. More and more packaging is added to make us believe that we’re getting better value, when we’re not. We all know the tricks that these stores play, why not be upfront about it?
So what can the small business learn from all this?
Don’t sell on price.
Know your benefits. Know why people buy from you. If you are being undercut by someone, add value – don’t take it away!
And be proud of your prices. Ever noticed how you assume something is expensive if a store doesn’t show it’s prices? And yet when a store shouts it from the roof-tops in big neon lights, you assume the price must be good? Don’t hide from your price.