Every Summer I cringe when contractors’ postcards arrive in my mailbox with “peak season” discounts, starbursts, and “20% off - limited time” offers. It’s June, July, and August in Alabama… you get sweaty and feel like you’re about to melt into the pavement walking to GET these postcards out of the mailbox. Why, oh why, do so many contractors feel the need to discount to get attention during peak season when simply making yourself known and available will likely do the same thing AND make you more money?

Maybe it’s the parent in me, but few things in life are more frustrating than repeating myself over and over while it seems like no one is listening. But, every Summer and Winter I feel it necessary to write, podcast, and coach on the same topic.

Please stop discounting yourself when you don’t have to. Especially during the peak times when business is coming easier. Stop selling yourself short.

Actually, the best practice is to learn how to STOP DISCOUNTING yourself at all. Although it might get you a quick uptick in service calls, constantly discounting your price is likely having an adverse effect on your brand’s value and raising red flags all over the place.

If you’ve been a follower of Hudson Ink for very long, you know we almost never encourage the super-sale, low-price-leader mentality. You might be looking for attention that way, but research shows the attention you normally gain by joining the bargain bin is not the market you’re after long-term, and it’s almost impossible to shake the “cheap” reputation once earned.

Instead of focusing on quick sales (especially at a time when your dispatch should be working overtime by default), let’s try a different tactic. Ask yourself, “How can I improve my closing ratios while keeping the most profit with the opportunities I have right now?” There’s a secret here, and it’s not that complicated. The smart contractor doesn’t throw all his cards on the table to START the conversation. He uses available discounts, margin, and additional services as weapons that can be used if NECESSARY and needed to close the deal.

And if they aren’t needed? Well… that extra 10% sure feels nice staying in your pocket.

Selling Really is 90% Psychological

Blanket statements don’t help anyone, so I’m not going to say things like, “Good salesmen should be able to talk anyone into anything at any price.” That’s ridiculous, and there are ETHICS to salesmanship that should not be ignored.

If you develop a reputation for not helping people out when they know you can, or always selling at full sticker, you’ll likely have high average tickets and few customers... Good salesmen learn the ebb and flow of meeting the customers’ needs while also not giving away the farm. Therein lies the true art of this exchange. Strange things happen in the minds of consumers during the buying process. People say they want to buy something cheap, but what they really want is to make a smart purchasing decision. Cheap is not a good deal if it breaks, and we have to buy three more totaling more than if we’d bought quality in the first place. What we want is to find a good deal, winning on price and quality, and calling our friends to brag about how we just found a unicorn.

Buying smartly is about saving money, sure, but we want to feel like we were the ones smart enough to beat the system. Don’t ever fool yourself into thinking your prospect is only focused on price. Price isn’t the deciding factor in every purchase or we’d all be doing all our shopping at the dollar store. Selling on price alone introduces a natural skepticism into the minds of your potential customers, and that’s a very bad thing.

One of the best business tricks you can ever learn is understanding the conversation your prospect is having in their own head. “How can he offer this tune-up for $50 cheaper than everyone else in town?” That screams, “As soon as he gets here, he’s going to try to talk me into something I don’t need. He has to… No thanks.” In a prospect’s mind “cheap” normally equates to “strings attached.” Cheap means it’ll cause me issues later, and even if you really do have the deal of the century… you’ll meet a prospect who asks, “what’s the catch?”

Used car dealers started observing this years ago. Did you know that on a used car lot if a vehicle isn’t selling, the price is more likely to go UP than down? Why? Because once you get below a certain price, our minds start to scream, “Lemon alert!” And a higher price actually helps ease the buyer’s suspicions that they aren’t getting scammed.

Want a good summer-time analogy? What questions would you ask about a beachfront hotel having to discount rooms to stay booked during 4th of July week? “Why aren’t you booked to capacity at outrageous prices like all the others?” “Just how bad IS your roach problem since you have to discount right now?” So, what questions are you putting into homeowners’ minds when they see your discount card show up during peak season?

Favors, Not Freebies

As I said above, the key to smart selling is to avoid putting all your cards on the table from the start, and simply play them as necessary. Use your tools strategically and personally instead of promotional style where everyone gets the same offer. If you’ll let that potential customer feel as though you’re taking care of them in a more special way than their neighbor, they’ll probably return the favor with more business.

You might offer 24/7 service, 20% off repairs on systems you install, and a whole list of everyday perks, but don’t just run through the list like it’s commonplace and make it seem like that level of service is a given by every contractor in town. Quite honestly, most of your customers don’t know all the bullets on your website and could be FLOORED by service you consider routine and standard. People love feeling like they’re getting something thrown in for free or as though they’re getting preferential treatment, so aim to make it a special experience for them.

You’re going to give them all the perks anyway because that’s what you do, but there’s a HUGE mental difference between saying, “Yeah, we offer 24/7 service for everybody…” and saying, “Here’s my card. If you buy a new water heater from me and ever have a problem, just call. I’ll have a tech here day or night.”

Your closing ratio will increase if presented like this… “These systems are usually $X, but I think I can get you a discount. Let me make some phone calls, and I’ll see what I can do for you,” versus a straight advertised deal the homeowner knows everyone gets offered. This will also prevent someone from seeing the advertised sale price and asking if you can go even lower. You’re already “doing them a favor” getting to the unadvertised price you just presented them, and they’ll run to sign the paperwork and possibly call a friend to tell them about this “great deal” they’ve found. You know the manufacturer is running a sale and exactly where your breakeven is, but if you’re completely transparent that the discount is because your supplier wants to get rid of these ASAP, their next question will naturally be, “Why? Because they wouldn’t sell? Because they’re defective? I’m not going to be your sucker.” Do everything you can to give them ways to quiet that voice in their heads. “No red flags. This is a good deal, and I’m being personally taken care of. I can buy with confidence.”

Remember, a homeowner is buying confidence in YOU before they are buying confidence in a product. If you feel like you have to scrape the bottom of the barrel price-wise to get the attention of your market, it cheapens your image and brand, sometimes to irreparable levels.

“They’re having to discount NOW? How bad is their roach problem?”

If you’d like to talk about more sales techniques, best practices, or ways that you can improve your brand and set yourself at a higher price point, we’re here to help. Call (800) 489-9099

or email [email protected] to schedule a one-on-one consultation!