Low Average Sale Price (ASP)
Are you leaving money on the table?
01 | Understanding the Problem
It’s all about LEVERAGE! Protecting your pricing or selling additional products and services in the initial sale is about leverage and too many salespeople give it away. The problem lies in a few areas:
- Lack of confidence is salespeople to ask for more for fear of losing the sale
- The inability of salespeople to know why a prospect should buy the offering in the first place
- The sales team is unable to demonstrate the VALUE in their solution
- Defaulting to the “base” package. The sales team lacks knowledge of the buyer’s business problems and therefore they are unable to provide the appropriate solution for each unique buyer.
Protecting price and selling more requires focusing on the buyer’s business challenges and why they need a new solution. Far too often salespeople jump to conclusions, do a poor job of discovery and quickly move to the dome or product pitch. When this happens, salespeople give away the leverage needed to defend their price or the higher-priced solution.
02 | Diagnosing the Root Cause
Have you listened to your team’s discovery calls? How quickly do they go to the pitch?
How quickly do they start talking about the product?
Open up the CRM. Look at the notes. How detailed are they? Do they contain a detailed description of the prospect’s business problems? Do they quantify the problems they are currently facing and looking to solve? Do they include the root causes or reasons why the problem exists? If not, your team does not have the leverage to defend your price nor do they have the data to support a recommendation for a more expensive, but better-suited solution.
03 | How To Fix
To fix low average sales price (ASP), sales teams need to create an environment where they have the leverage to challenge the buyer when they push back on price. They have to create an environment where the buyer sees the value BEFORE the end of the sale. They have to position their price or their higher price solution as the best value for the issues they are experiencing today and the cost of achieving their desired outcomes. The sales team has to put themselves in the position to say:
“I’m confused, you shared earlier that you were losing 500k a month in billings due to this problem and that it was preventing you from scaling the business and our solution only costs 15k a month. Can you please help me understand?”
Getting your team to a place with leverage and the ability to challenge buyers is how you protect and increase your average sales price.
Need more help with this problem?
Or do you think you’re dealing with other scenarios as well?
Team Not Converting
Poor Pipeline Development
Long Sales Cycle
All The Way Down Here?
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