Issue 07: "You're Expensive" is a great place to be

Author

Peter Ahn
October 17, 2024

When a prospect says “You’re expensive” or “This is way more than I thought it would be” it’s a great place to be.

You might think that giving your prospects “sticker shock” is offensive or puts you in a position of weakness, but in fact it’s the opposite.

This topic around pricing as a startup has been coming up often within my coaching sessions and here’s why I think placing a premium price tag on your product is exciting and why you shouldn’t avoid the “You’re expensive” conversation:

1. It gives you an opportunity to defend your value: After your prospect says, “You’re expensive” it gives you the floor to say, “We’re priced this way because…” And what comes after that should be a list of outcomes and value your product is providing (more on conveying why the price is the price here). Chances are if you’re building an amazing piece of tech, it should be obvious when you deconstruct why the price is the price, that your product is worth the dollars you’ve attached to it.

2. It allows you to talk about competition: Sometimes a prospective buyer may throw-up on your pricing because it’s more expensive than the competitor anchor points they may be used to looking at. Again, rather than shy away from this discussion, I would get good at saying “We’re different than the competition..” or “We’re the only platform that does…”. This allows you to justify premium pricing and makes the prospect realize why they’re talking to you in the first place 😎

3. It means you haven’t underpriced yourself: If there’s no pushback on pricing I’d worry a bit because how do you know you’re not leaving money on the table? Most enterprise organizations will want to negotiate off of your list price so if they’re not in that mode, I think it’s a signal that you’ve undercut your value and price.

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Competition

“Don’t worry about the competition” is one of the worst pieces of advice to listen to if you’re selling an enterprise B2B product. Competition absolutely matters. It's not something you should obsess over but it is something you need to address.

Your unique differentiators matter.

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Founder-led Sales Webinar

A couple weeks ago I delivered an early stage sales webinar for my Zero to Hero founder-led sales community covering 3 things every founder should consider when laying the foundation for their sales motion. I’ll be crafting these quarterly for the community and it’s completely free so if you’re a founder going through your own early stage journey, join the Zero to Hero community.

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Dropbox’s Whiteboard Culture

“You were respected as a seller if you understood the product in a deep way”. Mike Marg (investor @ Craft) and I spoke a few weeks ago about the culture at Dropbox and how special it was. One of the things that we both deeply appreciated is how much product knowledge and domain expertise you were expected to learn and the spontaneous whiteboarding sessions around this enablement.

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Episode 21: How to debug a broken sales process

What to do when you aren't making the sales.
❓ The first question to ask when debugging the process. 
🎎 How to figure out the right buyer persona for your product.
🪓 How to tell you should fire your sales leader.
🔬 The importance of being hands-on when sales isn't working.

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