All About Low Price

Peter : On Rad's Radar?
| Peter Radizeski of RAD-INFO, Inc. talking telecom, Cloud, VoIP, CLEC, and The Channel.

All About Low Price


I write about Low Price a lot.

While reading a trade journal, it got me thinking again about why this industry sells on price.

My thoughts:

You go low price because you either don't want to take the effort to sell or you suck at sales. [That's snarky but probably true.] I know there I times I don't feel like actually going through the whole sales process - discovery, questioning, needs analysis, probing - just to find out that the prospect is only concerned with price. It is annoying.

If you are a transactional agent (or a veteran T1 slinger) and you offer up 3 or more quotes, you are not selling. You are taking orders. There is nothing wrong with that. It IS how the telecom industry has acted since LDDS began discoounting long distance services back in 1983. But let's call it what it is.

Times they are a-changing.

If you just ask the customer for his bill or what he wants quoted or what he already has quotes for, you are order taking. There isn't a lot of value in that. Or a lot of commission.

I could see if you did that, then vacuumed up the rest of his telecom spend, but that's not what happens.

At the least, you could ask a couple of simple questions, like:

  • Are you looking for the cheapest? Or are there other factors at play?
  • Do you know the difference between broadband and dedicated Internet?

If you wanted to be a daredevil, you could ask these questions:

  • Are you worried about downtime or outages?
  • How important is reliability?
  • What does an Internet outage cost your business oer hour?
  • Do customers still order by phone? What would a dial-tone outage cost your company?

Remember that the prospect doesn't know telecom - that's your job - and it is your job to educate them about what they are asking for (versus what they need or want).

In managing salespeople, I sometimes think low price is about the thrill of the hunt - hunting for ink - on the way to the goal of Quota. In some cases, it is about reluctance to rejection as in "if I put forth a sales effort and don't win..."

Let's face it, offering the lowest price is faster. It takes some time to prepare to ask questions. As pricing is dropping, it takes more sales to make a living. Who is going to expend the extra time? It is easier to keep searching for the cheaper carrier.

It wouldn't hurt the Hunters to do some farming. By that I mean, upsell or cross-sell to your current client base in order to make:

  • the customer stickier to your business;
  • more commission/revenue;
  • yourself more valuable to the customer's business.

Even IDT todays makes its $1.2 Billion in revenue from a myriad of service offerings. It isn't all just LD revenue.

One last fact: the low price customers are also the biggest pain in the butt, which costs you time (time=money).

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