Come On Down – Is the Price Right?

Guest post by RSW/US New Business Director Kris Klopp

After you’ve prepared a quote on a project for a client, or prospective client, do you ever feel like you’re waiting to hear the Price Is Right announcer say “come on down!”?

I’ve had the chance to see many quotes/proposals prepared by a variety of agencies. They all usually have numerous line items with an assigned cost and the total budget at the bottom.

Some agencies get pretty granular with breaking down the costs, like a marketing buffet.  While others tend to list the required elements and then give one ball park sum.

The problem with this scenario, especially if you know there is more than one agency talking to this company, is often the decision comes down to price.  If the price is right, your agency gets to come on down and win the final showcase. But no agency wants to be selected based on price alone.

So how do you get around this?

I read an interesting article about selling in the “new normal,” the post-2008 economy.  (How to Sell More, Faster in the ‘New Normal’ )

This post has some valid points and I encourage you to read it in its entirety; however, here is the key point that can benefit your agency:

“2. Make a better business case: Pricing is not enough to get companies to buy big. You need to show how the money works from their side. This is critical. Don’t pitch the value without doing the money math. This goes beyond ROI projections. Because of the constraints on resources, buyers need to see the pricing and terms in relationship to cash flows rather than just doing their own calculations of capital expenditures or credit lines.”

I know this can be tricky – especially when you talk about areas such as public relations and social/digital media.

Instead of putting down a line item of X dollars for a direct mail campaign, provide an example of the average response rates and sell-through rates from previous campaigns you’ve done.  Spell out exactly how much a single mailer will cost to produce and mail with how much that one piece could return in a closed sale.

For example, a single mailer costs $2 to produce, another $0.55 to mail, but has the potential to bring $2000 Certificate of Deposit sale into your branch.

Remember, often times the final decision maker might be in strategic sourcing or purchasing. They weren’t in your initial pitch and didn’t see the genius in your work. And even if they did, they are number crunchers. So show them the money.

Use the estimate as another opportunity to show the VALUE you bring to that company, not just the cost to come on down and win that final showcase.