Price objections are one of the most common hurdles in sales management. When a prospect says, “Your price is too high”, it’s rarely just about the cost. Instead, it is often a reflection of deeper psychological triggers that influence buying decisions. Understanding these triggers can help sales professionals navigate price objections effectively, ensuring they maintain confidence in their pricing while reinforcing the value they offer.
We explore the psychological reasons behind price resistance and practical strategies to handle it without falling into the trap of unnecessary discounting.
Why prospects push back on price
1. Loss aversion: The fear of overpaying
Prospects fear losing money more than they are motivated by the benefits of a purchase. This concept, known as loss aversion, means that buyers are often more focused on avoiding what they perceive as an overpriced deal rather than recognising the long-term value of a solution.
Solution: Frame the conversation around potential losses they may incur by choosing a cheaper but inferior alternative. Highlighting missed opportunities and risks can make your price seem more justified.
2. Perceived value: More than just a price tag
A prospect’s willingness to pay is closely tied to their perception of value. If they believe the solution justifies the price, they are less likely to object. However, if they are unclear about how the offering benefits them, even a fair price can seem excessive.
Solution: Focus on outcomes rather than costs. Effective sales management utlises the demonstration of tangible benefits – such as time saved, revenue gained or problems solved – to reinforce the value of your offering.
3. The anchoring effect: How first impressions shape price perception
Prospects often compare your price to an initial reference point, which could be a lower price from a competitor or an expectation set by a past purchase. If their initial anchor is significantly lower than your price, they may see your offer as expensive, even if it is competitively priced.
Solution: Control the anchor by presenting a premium option first before introducing your standard offer. Alternatively, compare your pricing to higher-tier competitors rather than lower-cost alternatives.
4. Confirmation bias: Justifying preconceived notions
Many prospects enter a sales conversation expecting to negotiate. If they believe your price is flexible, they will look for justifications to support that belief, pushing for discounts regardless of the value offered.
Solution: Stand firm on pricing and reinforce the idea that your price reflects the true value of your solution. In sales management, confidence in your pricing discourages prospects from assuming discounts are standard practice.
How to respond to price objections
1. Slow down and ask questions
Rather than immediately responding to a price objection, pause and ask clarifying questions. This approach disrupts automatic price resistance and shifts the conversation toward value.
- What makes you say that?
- How are you comparing us to others?
- If price wasn’t an issue, would we be your top choice?
These questions help uncover whether the objection is genuine or just a negotiation tactic.
2. Reframe the conversation: Shift from cost to investment
The more experienced a salesperson becomes in sales management, they learn that prospects often view pricing in isolation rather than considering the bigger picture. Reframing the conversation around return on investment (ROI) rather than cost can help shift their mindset. For example, instead of saying: “This solution costs R10 000,” say: “This investment of R10 000 can generate R50 000 in additional revenue within a year.”
3. Use social proof and fear of missing out
People are influenced by the actions and experiences of others. Sharing testimonials, case studies or examples of similar clients who initially hesitated on price but later saw immense value can be persuasive. Additionally, creating a sense of urgency – such as limited availability or exclusive pricing for a set time – can encourage prospects to act.
4. Maintain your pricing integrity
A common mistake in sales management is immediately offering a discount when a prospect objects to price. This weakens perceived value and signals that the original price was inflated. Instead, focus on reinforcing value and, if necessary, trading concessions instead of cutting costs. For example, if a prospect insists on a discount, counter with:
“We don’t discount, but if you can commit to faster payment terms or provide a referral, I can explore additional benefits for you.” This ensures you retain value while still accommodating the prospect’s needs.
When to walk away
Not every prospect is a good fit, a hard truth we often learn in sales management. Some buyers are solely focused on price and will leave the moment a cheaper option appears. Others simply do not have the budget. Spending too much time trying to win over price-sensitive buyers can drain resources and impact overall profitability. It is better to focus on prospects who understand and appreciate the value of your offering rather than those who are only looking for the lowest price.
Handling price objections is as much about psychology as it is about sales strategy. By understanding the psychological triggers behind price resistance, sales professionals can steer conversations away from cost concerns and toward value creation. At SalesGuru, we help sales professionals master these techniques and close deals without compromising on price. Contact us today to learn how we can support your sales team in overcoming price objections with confidence.
