Each quarter has unique roadblocks to closing — but none stack against sales reps quite like Q4 pricing strategies. The end of year race to the finish line can be distressing on many fronts: multiple holidays and long weekends disrupt the regular business cycle, cold and flu season causes teams to lose momentum, and colder weather brings out the Garfield in everyone.
Q4 also means end-of-year budgeting, which can impact even the hottest leads. Shoestring budgets may be perceived as the enemy of goal fulfilment, but with the right approach and mindset they can be navigated successfully.
To make the most of Q4 pricing strategies, we asked sales leaders to share their top tips for success. We broke their advice down into the four categories:
Challenge the instinct to avoid the pricing conversation. There are many advantages to broaching pricing with prospects, including encouraging needs prioritization and risk assessment.
Mary Rogul, VP Sales Strategy & Engagement at Crayon, notes that broaching pricing does not mean providing a final price point. “In the first conversation, you don’t know enough to give a succinct number,” she says. “My answer is usually “Based on what I know today, if I had to give you a price point at this juncture it would be in this range.”’
Hannah Brennen, Account Executive at Diligen, says that bringing up ballpark figures early on can help shift the conversation to the prospect. “Try to get prospects to qualify themselves a little bit — make sure you’re on the same page — but then have in-depth discussions later in the process”
Best Practices for Q4 Pricing Strategies
Grounding your conversation in the needs of your prospect can save you time and create higher quality conversations. To do this, start considering what value means for both you and the prospect.
Lisa Schnare, Director of Sales Development & Head of Halifax Operations at Influitive, advises that value needs to be transparent from the get-go. “Ensure you understand the problems you’re solving for and how they impact the company’s objectives,” she says. “If the prospect can’t tie the need for your solution back to a company objective they are at a higher risk of either not getting executive sponsorship internally and/or churning when the contract is up for renewal.”
Sales representatives play a significant role in helping prospects identify these needs, according to Rogul. “[Pricing conversations] are all centred around what do I know about the prospect, and what do I understand is valuable for you using our software,” she says. “If I see that it brings incredible value to you then ill start talking the best price point and package that moves you forward, but I have to understand what the priorities are with software alignment prior to those discussions.”
Major Faux-Pas for Pricing Discussions
While pricing talk can be a great opportunity for building trust and transparency, it can also be a slippery slope when navigated aggressively.
It may be tempting to pull all the stops you can to close — but this strategy can miss the mark entirely in Q4. Rachel Shi, Account Director at eSSENTIAL Accessibility, encourages resisting the urge to discount right off the bat. “Understand the “why” behind the ask,” she notes. “Maybe it’s not the dollar value that’s the issue but where the customer is at in their budgeting cycle – in which case maybe you can get creative with terms instead.”
If you are hearing sticker-shock in the late-stages of closing, take a step back and evaluate if you’re hearing an objection to pricing or simply a complaint. Brennen explains that a prospect’s reaction to pricing is rooted in their perceived value, so sales reps should be ready to assess reactions as a misunderstanding of value. “If you’ve qualified your prospect properly, then any reaction shown to pricing should be more of a complaint than an objection,” she says. “A reaction doesn’t necessarily mean they object to price as long as they understand the context of value.”
Leveling Up Your Q4 Pricing Strategies
Advice is best taken when paired with personal development. Here are some recommended pricing resources from our experts:
“Chris Voss’s book Never Split the Difference is invaluable for negotiations.” — Rachel Shi
“I was fortunate enough to take part in ValueSelling Training last year and it is incredible. I use what I learned in their training every day!” — Lisa Schnare
Using the right pricing tool can increase your deal velocity and help you close deals faster. Learn more about FastSpring Interactive Quotes, the ultimate SaaS pricing tool, by clicking here.