My Two Cents

May 7 2009 11:21AM | Permalink | Email this | Comments (4) |
Blog This! using: Blogger.com | LiveJournal |

By Susan Bady

I had an interesting conversation with Myers Barnes yesterday. (If you don't know Myers, he's a new-home sales consultant, trainer, speaker and author who works with builders all over the U.S.) We were talking about new-home builders giving discounts -- how widespread it is and if you're going to do it, how to do it right -- for an article that will be published in the July issue of Professional Builder.

Barnes contends that the big mistake salespeople are making is that they present the deal/discount/incentive (whatever word you prefer) within the first 30 to 40 seconds that a prospect walks through the door. Of course, it's a very different market nowadays and buyers expect -- well, according to Barnes, they feel entitled to a deal and it's one of the first things they'll ask about. But if the salesperson gives out that information right off the bat, before the buyer has even seen the models or picked out a home site or heard the sales presentation, the discount becomes meaningless. There's simply no basis of value, says Barnes, and by using the discount as their opening statement, salespeople are giving buyers a powerful negotiating tool. Imagine prospects saying to themselves, "If they'll give me this much at the meet and greet, there's got to be more later!"

Essentially, new-home salespeople have to put the value proposition before the discount. If a buyer asks, "Are you offering any special deals today?," an appropriate answer might be, "Well, actually we do. We have great homes, a tremendous location, outstanding schools, we're an Energy Star builder and offer phenomenal customer service." Now the discount actually means something and can be used as a closing tool rather than an opening gambit.

How do your salespeople sell? Are they pushing the discount first or the product?