Three Weird Discounting Mistakes Sales People Often Make (Are You Doing This and Killing Profits?)

Three Weird Discounting Mistakes Sales People Often Make (Are You Doing This and Killing Profits?)

Salespeople often unnecessarily give away discounts. This damages brand value, slashes margins, leaves money on the table, and trains customers to always expect price cuts, needlessly killing profits.

While there is a time and a place to discount (such as when dumping excess or old inventory, quantity purchases, or long-term purchase contracts), in most sales situations, cutting price is unnecessary to get the deal.

Most customers ask for a discount because they’ve been trained in negotiating classes to say, “That’s really expensive,” or, “Can you do better than that?” or other stock phrases that indirectly or directly demand a discount. Most sales people fall for it and needlessly give away profit.

It’s Your Professional Duty to Not Discount

It’s the customer’s fiduciary duty to ask for a better price and it’s your fiduciary duty to resist that pressure to keep more margin. That’s the perennial battle of sales.

Think about this: the top companies rarely discount their goods and services. Apple doesn’t discount the latest iPhone. Great restaurants never put their best steaks on sale. Do you discount yourself, accepting less pay when looking for a job? I hope not!

Here are three weird discounting mistakes that you should never make and how to avoid them.

Offering a Discount, Unasked

Sales hack: “… and I can knock off another $20.00 if you buy right now.”

You should never discount your price without a good reason. While poor sales people falsely believe that offering a discount creates goodwill with the buyer, that’s rarely the case. They’re just giving away money in exchange for nothing; not loyalty, not value.

Instead, build the value of your offering in light of what your customer wants. Focus on their objective; what they want to accomplish, to know that they don’t yet know, be able to do that they can’t yet do, or feel the way they don’t yet feel. Then prove that they achieve their objective when they buy from you and they’ll say yes without a discount.

Discounting When First Asked

Customer: “You’re too expensive.”

Sales hack: “I can give you a 10 percent discount.”

This knee-jerk reaction to the customer’s observation about perceived value shows lack of sales skills. Any idiot can offer a discount. If a salesperson must offer a discount to close the deal, they are lousy at sales and unnecessarily cost the company profits.

A real sales pro communicates why their offering is worth the asking price and never defaults to a discount.

Instead, reply with, “Too expensive? When you say, too expensive, what do you mean?” You need to find out if they think too expensive means two cents, two dollars, or two million dollars. Once you understand what they’re thinking, you can counter by illustrating your value.

Anyone who has been through negotiating training knows to ask for a better deal at least twice. “Too expensive” is typically the first push back on price. You’ve got toresist discounting at least twice if you’re going to keep your well-deserved margin.

Discounting When There are Other Options

Customer: “My budget is $100 less than your price.”

Sales hack: “Okay, I’ll knock off $100 to meet your budget.”

Claiming lack of budget is a frequent negotiating tactic, especially if their declared budget is close to your price point. If you have options, price-cutting becomes totally unnecessary.

Charging less when you have a product at a lower price point is reckless and devalues your product line. The reason you have offerings at a variety of price points is to serve customers at their budget point.

Instead, offer a cheaper product — refurbished, b-stock, open box, fewer features — that fits their budget. If you can subtract something of value, such as deleting an option or offering standard shipping, do that instead. Frequently, you’ll find your customer magically finds the money to make the purchase.

A few ideas from my forthcoming book with the working title “Selling Disruption.”

Let’s have a conversation if you think my ideas can help you succeed with your product launch or speak at your forthcoming meeting. Find a mutually agreeable time at

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