Control the narrative: What to do when The Competition is eating your lunch
A new competitor to one of my clients came in to their town and was lowballing prices to get work. They weren’t offering the same service as my client. They weren’t offering anything but low price. To top it off, they put their lowball prices on their website just to get people to call.
Everything was “an extra.” Nothing was guaranteed. Of course this wasn’t on their website.
Potential customers didn’t know the difference. They just saw the price and went for it.
My client’s customers were seeing this and calling. “Can you match this price?” If my client said no, then they lost the work. When my client said yes, they went to their clients’ locations and explained the difference. Once they understood, most said yes to the real service. If the client said no, they made the decision to perform the proper job at a loss for their clients. They wanted to keep them and justified the loss this way.
How do you combat lowball prices? Marketing.
Clients need to be educated as to the difference in price. Why is the “lowballer’s price” so low? What is the difference in work, quality, and warranties? This is marketing’s responsibility.
Clients are doing on-line searches. They may be doing this search because they think your company doesn’t provide this service or perhaps they weren’t totally satisfied with your company’s service the last time you were at their home.
The best way to combat a low price is to create a white paper titled, “Six Questions You Must Ask when you call a NAME OF PRODUCT OR SERVICE.” For example:
• Six questions you must ask when you call a plumber to clear a stopped up drain.
• Ten questions you must ask when you call a heating and air conditioning company.
• Ten questions you must ask when you call a plumbing company
This paper can be offered on the home page of your website as a download. To get the download, the potential client must enter their name, email address, and telephone number. Some “experts” argue this is too much to ask. In my opinion it is the minimum to ask to receive the download. If a potential customer won’t give you this information they aren’t seriously interested.
You can distribute the white paper. Salespeople can give it to potential customers. It can also be sent to clients and potential clients or put in your newsletters and other marketing materials.
What are the ten questions? Questions that differentiate you from your competition. Questions like:
1. Where do I find a company I can trust?
2. If I have to do a web search, what should I look for?
3. What does the person sound like who answers the telephone?
4. What type of warranties is offered on repairs and system replacements?
5. Why is a low cost price generally not the best way to go?
6. What type of response time can I expect?
7. What about maintenance agreements? Are they worth it?
8. Is the company licensed an insured?
9. Are the technicians NATE (North American Technician Excellence) certified?
10. What should you expect when a company representative arrives at your home?
Formulate answers to each of these questions. Then educate your employees who talk with potential clients on the telephone. They need to be prepared with what you want them to say to a potential client who calls with these questions.
The best way to compete with low ball prices is to educate the customer. Some will still only want the low price. However, once most people understand the difference, they will choose the higher quality and better benefits that you provide.