Stefan Drew - The Marketing Magician

Education & Business Marketing: Quick, Effective, Low Cost Marketing

Stefan Drew - The Marketing Magician

The Power of Three in Selling

Giving Buyers Options Can Significantly Increase Sales, Ideally We Need To Use The Power of Three

 

Why Use The Power of Three in Selling?

Simple. The number one is dangerous in marketing. Give people one option and they say yes or no. Too often you will get a No answer, especially if someone else is cheaper.

But the number three makes for marketing magic and certain sales. It is a form of Advanced Thinking and a very powerful negotiation tactic. 

 

An Example of How The Power of Three Works

I often get asked to speak at conferences and in-house training days. Last week someone asked me to quote to speak at an event. They also asked others to speak and I guess we are all acceptable to them or they wouldn’t have asked us. So the only deciding factor left from the buyers perspective is price. All other things being equal the cheapest person gets the work. 

So how can you become more certain to get the work? My tactic is to stop the buyer making a straight comparison based on price alone.

In my case I gave them a quote for exactly what they wanted, but then provided two other options.

The second option was the same as option one but included an add on. In this case it was to also run a QA session online. We could do this on the clients website, on Facebook .. anywhere they choose. 

The third option was to offer the basic speaking session as requested plus a webinar. This could be live or recorded. 

Each was priced separately and clearly the options cost more. In some cases the options will cost multiples of the basic option.

 

How Specifically Does The Power of Three Work? 

I do the above quite often, here’s why.

We know one option doesn’t differentiate us and we then compete on price.

Give three options and, even if the buyer sticks with option one, you are seen as being more responsive and more authoritative. 

But it goes further. Few people want to buy the “cheap” option that everyone offers. They don’t want to look cheap. They are most likely to go for the middle option. 

Option three is less likely to be bought, although last week the buyer went straight to it and didn’t discuss the other options with me. 

The thing is with three options you are really offering the equivalent of three different packages where only one was requested. It gives the buyer three chances to say yes, not one. Often they then buy one of the higher price and value packages, that they hadn’t previously considered. And, as in my recent case, they sometimes buy the luxury package they would not have otherwise considered at all. 

The Power of Three works like magic in the majority of cases. It increases both the chance of a sale and the level of sale price.

Try it. You could be surprised how your profits rise. 

 

PS Offering more than three options just confuses buyers. Avoid it in most cases.

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4 Replies to “The Power of Three in Selling”

  • Your little notes on the sales procedure are very good and should be compulsory for all involved in sales including those in customer services or whatever it is called in the organisation.
    If I wish to enter the medical profession then I have to train and train hard for a number of years. Very different for sales positions. Often there is not even a degree there it’s just, as someone once, somewhat crudely pointed out “provided they don’t pick their nose in public they get hired”.
    So often the criteria in the real world are not that better.
    There is also your phrase “You could be surprised how your profits rise” Not if the sales person is centered on their commission or fulfilling their quota this month. Profit is then often not even considered.
    This country now needs sales, more than ever before perhaps, so I believe that training more sales people might be a good place to start

  • Mike, Thanks for your kind words.

    I’ve actually written a series of posts on on general selling topic. The next one is on Flat Pricing Models and the one after that is on Value Based Pricing Strategies. All have a place in most businesses, although some fit better than others. However all busienss people should understand the basics of each of them as there are countless variations that can be applied once the basics are understood.

    I’ve just landed a nice little contract based on Value Based fees which is multiples beyond what I would have otherwise charged. My normal rate would have been considered a trifle expensive, but when the client and I explored the value I was providing to his business and how his bottom line would benefit many fold he was quite happy to pay me a percentage of the perceived value. The great thing is he is perfectly happy to pay more .. and I’ll explain why that is in the future post.

    As for sales people not having sales degrees .. sadly many don’t have a degree in common sense either. They just go for commission; but then that is really the fault of the directors that have set up the commission basis. There are ways around the situation but most seem to ignore the logic that goes with it. Fortunately the people reading this series of post will soon know better. The fact they read the stuff I publish outs them several notches above the average!

  • Thanks Stefan. I like the way this 3 options works to increase credibility and build perception of expeetise besides providing 3 opportunities to say Yes. Even if they say No, the 3 option giver stands out.

  • Thanks Svea,

    This looks complex to some people but it isn’t. It is actually simple and the simple ideas are often the best. The great thing is that it works in virtually any sector or country and I can see it potentially working in your sector in SA.

    As another friend of mine often says … Beyond complexity lies simplicity.

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