Wednesday, December 5, 2007

Overselling Revisited, Selling a Product That Is Not Number One

Recently I encountered a salesman who knew very well that his product was not the most sought after in the market. In trucking, Peterbilt and Kenworth are soomewhat like BMW and Mercedes in terms of how much drivers want to drive them. They are definitely considered the premier trucks on the road by many drivers. Freightliner, by comparison, is more like driving a Buick or a Dodge. Well, when my company was deciding what type of trucks to buy, we seriously considered the Kenworth first because of its appeal to drivers - which would help recruitment - and because of its resale value. Then we met the Freightliner salesman. His argument went something like this.

"Do you like to overpay your taxes? he asked. Of course the answer was no.

"Well, buying a Kenworth is like overpaying your taxes. Sure, you can get more for the Kenworth when you're done with it. Resale is a huge selling point for them. But you pay more for it up front. I'm willing to let you keep that extra money now."

Obviously the man knew that trying to sell us on all the great things about a Freightliner was not the way to go. He openly admitted there is a product available that is more widely sought after. He just knew how to sell his product. By appealing to something good about his product without pretending it was the best available, he helped us decide to buy from him. And we did.

Selling a product in a dishonest or misleading fashion can be even worse for a business that overselling its qualities. If a salesperson convinces a person to buy an inferior product and denies a better one exists, when that consumer sees the better product he might never return to the store where he bought his inferior one. If the salesperson instead points out that the better product exists but makes a reasonable comparison of the costs versus the benefits, he will likely sell more of his own product and improve his store's reputation.

-- Robert


le35 said...

I think another thing to think about is that maybe your product IS inferior to the other one, but maybe it has something just a little different, or maybe you can help people understand that the other product is worse in another way that yours isn't. Price is a good comparison, but personally, I'm willing to pay a little more for a good product. I'm always willing to buy Campbell's soup instead of Great Value brand for instance? Why? Because it tastes better. If Walmart could sell me on it by letting me taste two soups or something and the price were lower, I might switch.

Robert said...

In our case, we knew both trucks would last as long as needed and be under warranty, so barring a huge quality difference in what they could accomplish in that period, there was no reason to pay more. The argument was perfect for anyone not planning to keep a truck forever, and I think the salespeople in the new equipment business know that their customers are not long-term purchasers as a general rule.

In another case, though, I can remember other examples. When we purchased our bed spread, we looked at the price of "high quality" spreads versus "good quality" and noticed the price was at least five times higher. We decided we could afford to go with five cheaper ones (not all at once) over the one expensive one, knowing that both would suffer wear and tear and probably need replacing but five would last longer than one great one. I've never regretted that decision.

When making purchase decisions, the person selling the best item obviously has a great pitch to make, but that does not mean other products have no way to make their case. I think most of the time, though, it comes down to who is in the market for their product. Knowing their customer can be just as important to salespeople as knowing their product.