The Facts: Why a Customer Chooses You in a Recession

By Jeremiah Wilson

My company ContactPoint has stood in front of businesses large and small, to teach them how to get more sales. And we often start by asking this question: Why does a customer choose you?

How do they determine where to buy a product or service — especially during a recession?

After I ask this question, hands always shoot up: “Price!”

Wrong.

Based on our research, price is NOT the number one consideration for someone making a purchasing decision in most industries.

Now, before you stop reading in disgust, let me clarify: Price is a consideration and a specific price range is a big consideration. However, in a consumer industry, more than 80 percent of the time, price is NOT the number one reason a customer chooses you.

So what are the biggest reasons a customer decides to buy from a certain business in a recession?

    • Value. This can mean different things for different people. To one person, value can mean a combination of price and quality. In other words: a good deal. For someone else, value means being treated well. For someone else it may mean “feeling” like they made a good purchasing decision after the fact. Value is especially important during a recession.
    • Confidence. Customers must be confident that they were well taken care of during the purchasing process, and confident that they’ll be taken care of in the future. Your actions control this outcome. Are you treating the customer in a way that engenders confidence? Are you acting like a salesman or making educated recommendations as a trusted consultant? Are you treating the customer with respect and kindness? These actions build confidence.
  • Trust or “Like.” Finally, the number one factor a customer — either consciously or subconsciously — considers when making a purchasing decision is whether or not they like and trust you. This is even true during a recession. It’s simple, really: We like to hang out with people we like and trust. We like to work with people we like and trust. And, yes, we like to buy stuff from people we like and trust.

Think about it this way: if your employees were more likable on the phone, could your price be five percent higher than the competition and still get the business? You bet. What about eight percent or more? Depending on the situation, and the customer, absolutely.

If you can get a potential customer to like you, you can avoid or overcome almost any price objection. But, instead of attempting to get to know customers, instead of getting them to like you, what do most employees do? They immediately quote a price or they try to price match, in a last-ditch effort to get the client. Your employees feel like the recession forces them to do this. They feel like the bad economy demands a lower price. But, in most cases, all this price convincing is simply unnecessary. Just get the customer to like and trust you.

3 Ways to Get the Customer to Trust and Like You

1. Tone. When you’re speaking to a customer on the phone, the words you use are only 14 percent of the message you’re communicating. The tone of your voice is 86 percent. If you sound happy and engaging, the customer will like you.

2. Validate. Make sure the customer knows you’ve heard his concerns. Make sure she knows that you care about her. That’s the key. Phrases like “I understand what you’re saying” or “So let me make sure I understand correctly,” followed by a restatement, are really, really important.

3. Questions. Ask many. Make sure they are open-ended. Think why, what, where, when, and how. Everybody likes to talk about themselves. If you ask questions and are legitimately interested in the answers, the customer will like you.

And remember — don’t fall back on price. Price is a cop out. Immediately quoting the price is an excuse for an employee to avoid getting to know the customer. This is true for a major B2B account or a B2C business. A computerized answering system can quote a price. Humans can — and should — do better.

Additionally, immediately matching a competitor’s price is an excuse for an employee to avoid building value in your product.

Our statistics prove that if you avoid quoting price at the beginning of a phone call, you will close substantially more sales.

Remember, price is not the number one reason people buy from you. Whether or not they like you is.

Jeremiah Wilson founded ContactPoint in 2001 with a patented device that records customer phone calls, allowing companies to hear what their customers hear. Prior to that, he specialized in logistics, customer service and sales training, and was assistant to the counselor of economics at the U.S. Embassy to the Czech Republic; he currently serves on the board of directors for various global companies.
Originally published: Nov 8, 2011

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