You can’t compete against bad quality
Posted on July 3, 2006
Let me say few words on failing against a much cheaper solution (so cheap it couldn’t be real)
Being a “Sales guy” I have a natural attraction towards evaluating sales situations and especially sales failures. Just because I write a blog doesn’t mean I don’t fail in sales. I fail, and I can tell you about it.
There is something in the sales guy mind that says: “you should close every sales”. It does not matter if you close one sale per day, or 100 sales, you still want to close any sale. It’s probably about ego, self estime and selling yourself. More, the today society really teaches us first how to spend money (teens years) and just after a while how to make them (maturity). As a sales guy, you would think that your customers are already educated about the real value of the services and the prices attached. And that’s wrong.
In most Western cultures it’s known that nothing is for free and quality comes with a price. But in Eastern Europe, quality is a relative aspect, mostly because:
- East European people don’t have a “culture” for quality
- Purchasing power is much lower
This is actually an excellent opportunity for not so “quality oriented” companies to find suitable markets using obscure sales techniques. Now, I work on software sales in Eastern Europe, and I’m mostly a “quality oriented” guy (actually I don’t feel too much as an East European but more as belonging to a Worldwide community - but that’s a different story).
Let me get to the point. One or two weeks ago I had to deliver a site for a company and I usually offer hosting services for my clients at low prices, because I want to be sure that everything works as it should (just low enough to cover the expenses). In the deliver day I found out that the customer is not willing to pay even the minimum price for the hosting, because he had a MUCH cheaper offer from another company. Nothing to complain so far, it should be his choice.
Understandable, I had a look at the offer specification. It was that kind of “too good to be true” offer - looking good on paper for any person that doesn’t know anything about hosting. I’ve advised the customer to find another solution, and even cut back on my price with the full value of the hosting I was offering. So basically I’ve made hosting free for him the first year.
The hole story ended up by giving the customer a discount to make the hosting on my server free, but installing the site on that “cheap” server and the application not working the next day as expected…And the customer still got the discount…and got unsatisfied as the site was not working.
That’s why I do believe you should not compete against bad quality. First of all, it doesn’t follow the rules of a regular sales and second is doing more harm than good. Here are some reasons why you should ignore “bad quality” competition (or let’s say dumping offers):
- it cuts down your profits
- puts you in a position to lower your quality
- affects your market, branding and positioning
- has a negative impact on your sales team that is forced to act outside real sales rules
So I’ve lost the sale. I’ve got less money, less profit because I’ve tried to offer a competitive alternative.
Quality comes with a price. You should learn how to sale quality.
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