Customer Love Letters
When sales teams tell me they are limited in pricing power because of competition, they often cite competitive price match requests as a prime example. Customers offer a version of “Competitor XYZ down the street can give me the same thing for 5% less. If you’ll match their price, I’ll buy from you.” (This comes in different flavors of the same bland tactic.) Those are the words.
The message beneath the words is “Competitor XYZ down the street is inferior to you in a way I am not going to disclose and I hope you don’t figure out, and I’m hoping to trick you into giving away your superior quality and service and excellence for their low price. Is this ruse going to be effective? Are you going to fall for this?”
If Competitor XYZ were cheaper and better, the customer would buy from Competitor XYZ. Why would the customer even be calling you? Competitor XYZ is cheaper, but YOU are better. They are just using the price match request as a tactic to get your stuff for less. A price match request is an objective statement of preference for your product, service, and company. They don’t want Competitor XYZ, they want you. I’ll go further: a price match request is a love letter from your customer. They don’t love Competitor XYZ, they love you.
Now, importantly: this is not a moment for arrogance but instead a moment for questions. Why? Because you don’t know if the customer loves you a smidgen or a ton. But you will often find that when asking the right questions that this is nothing more than a customer tactic, and there is no need to price match at all. And if you decide to price match, please don’t let this cut your confidence. Let it lift your confidence. Your customer just handed you a love letter.