Four Reasons Why You Are Hurting Your Credibility By Hating Customers Who Ask For A Discount

If you’re reading this and thinking: I live in the Western world, why should I care about price haggling, well, you may be surprised. People in the Western world engage in price haggling (aka negotiation) regularly. If you doubt this, consider: When was the last time you asked your window cleaner for a discount? How about your landscaper? Have you ever asked for a volume discount at the store? What about asking to reduce the price of some features on your cellphone? Or have you ever used the services of Poshmark? It may take a different form, but this is price haggling.

With so much price haggling in the Western world, why do some small business owners blow a gasket when their customers ask for a discount? Social media is filled with stories and reels of small business owners incensed at the audacity of their customers asking for a discount.

The purpose of this blog is to share my personal experiences with customers who love to negotiate prices and to offer advice on what not to do when dealing with this type of customer, especially in the age of social selling. But first, let me share a story.

My first experience with commercial activity started when I was 11 or 12 years old. I spent most of my time living in Nigeria with my grandmother, a serial entrepreneur. She was a “trader” (as owners of market stalls are commonly known) of multiple consumer goods at the local market. When giving me instructions to sell her products, she would give me a price range to stay within. And I was good at delivering sales. But one day, off I went to sell a tray of tomatoes from street to street; I set a price and wasn’t going to budge on it. Surely, these adults knew how hard it is to sell a heavy tray of tomatoes in this scorching heat. I expected that my customers would be compassionate knowing that my school fees and livelihood were attached to this trade.

When I returned home, only one customer had bought from me that entire day. I felt dejected. Grandma said in loose terms, “Child, don’t set the price as if you only have one customer that you wish to sell to.” She knew that I had entertained a fundamental mistake about running a retail business: I thought my dedication in the hot sun was worth more, so I priced it into each unit of tomato instead of looking at it from the point of view of the entire market population.

This was a lesson that I needed to learn first-hand. So, over the years, I observed her and my mom transact with customers in the market from all income statuses and learned: an entrepreneur has to be prepared to negotiate prices at all times. The market is visited by people who desire your product from all income stripes, and not all can afford your asking price. So, by negotiating, they will see if the seller is willing to meet them halfway.

Why Do We Get Offended When Customers Ask For A Price Discount?

When you ask most entrepreneurs (myself included) why they get offended by price hagglers, they will often say it’s because our livelihood is at stake. But, that’s only a half-answer. One customer asking for a discount is not going to make or break anyone’s livelihood, especially if the discount is not honored.

Survival Instincts

Like that 12-year-old girl selling tomatoes to pay her school fees, some entrepreneurs attach survival to the sale of each unit instead of the overall revenue. As small business owners, our ego attaches us to our dreams, but our purpose gives us the drive to achieve them.

Only other entrepreneurs understand the hustle it takes to build a business. Often we endure 28-hour days. Sometimes we suffer from sudden heartbreak over failed attempts or relieve anxiety over the fear of negative reviews—the highs and lows that often render us sleepless are not for the fainthearted. So, it’s natural that we put a high price on the toil of our sacrifices, and this leads us to set a high price for the product of this toil.

It’s, therefore, no surprise that when someone asks for a discount after we’ve pushed ourselves to success, we’re ready to flip them off. How could they dare diminish the price of our success by asking for a discount? I mean, the audacity.

Why Is This Reaction A Mistake?

The answer lies in my social selling rule #4 “Never Get High On Your Supply.” Yes, it’s a quote from the famous Notorious B.I.G. rap song, “Ten Crack Commandments.”

So what do crack commandments have to do with social e-commerce? We can develop an endless supply of ego when the struggle as described above propel us to eventual success. However, it is completely normal to get high on our ego and feel entitled to being seen and heard by our customers. The “D” word for a discount just irritates us and in the age of social selling where customers have a lot of options, that is a very bad idea.

The thing is, customers will never equate our highly prized sacrifices to high value. Our career sacrifice is not synonymous with what they view as “value for the money” and nothing we do can change that. Rather than make an angry Instagram reel about a customer asking for a discount, consider this:

Your Attitude Is Likely Sending The Following Unsavory Messages:

1. Customers are not welcome here. By entertaining a negative attitude about a discount request, you are conveying to your customers not to bother supporting your business. The message you’re sending is: I value my labor more than yours. Instead, lean towards treating people with dignity, and avoid being rude or insensitive to those who seek a discounted rate.

• You have no purpose. A customer that is haggling prices with you buys into the value proposition and desires your product, but they want to see if there is a way they can work with you without blowing their budget. By calling them out on social media, you’re signaling to future customers that your sole purpose for being in business is to make money instead of providing value. And that message can ruin your credibility.

• You’re not interested in your customers. Small businesses negotiate every day. E.V.E.R.Y.D.A.Y. Your customers know this and they will feel undervalued if you are not willing to at least engage them in this exercise. Why should negotiate to be a privilege is reserved for businesses but not for end-users?

So how should a business handle discount-seeking customers?

The short answer is by engaging with them in a purely relational customer service exercise. Sadly, this is often overlooked in social selling transactions. But here are:

Four Ways To Navigate This Social Selling Terrain And Produce A Positive Experience For All Parties:

1. Educate Customer: If they are inquiring about a discount, they feel your product doesn’t have enough value to warrant the price. So, use this as an opportunity to show them why your product is worth it. While we often expect our customers to innately understand our offering, this isn’t always the case. As entrepreneurs, our ego wants to believe that customers will be invested in our dreams once we put them out there. But the reality is, most of us customers are not. Some will be more astute at evaluating value than others, but just because one person comes along and accepts the value proposition doesn’t mean that everyone will. Remember, if they’re asking, it’s likely because they want to support you but, they are calculating a trade-off between the “Value and Price” before they arrive at a decision. Why not invest some more time into showing them that your price point is worth it?

• Be mindful of their concerns: There is always a reason a customer asks for a discount, and it’s not always as ego-threatening as you initially think. Are they on a tight budget? Are they weighing the value of your product against other substitutes and alternatives? Ultimately, you get to decide if you accept or deny their request, but regardless, engaging them in the exercise shows that you are attentive and interested in them. They may walk away from buying at first only to return and pay your asking price. But only by engaging them and being mindful of their motive can you achieve this result.

• Define and understand your purpose. This should be the starting point of any attitude adjustment. Having a fervent belief in the superiority of your craft is great, but be clear about what you want the value of that craft to be for your customers. When your customers understand that the purpose of your product or service goes beyond your desire to be heard, seen, and make money, they will eagerly buy into it. Even if they initially walk away because they truly can’t afford your price point, they will always remember your attention to their needs. This nostalgic feeling is what yields a lifetime loyalty to your brand.

• Implement a proper pricing strategy. In my opinion, this is a springboard for the tips above. My grandma’s advice to my 12-year-old self is a model to live by as an entrepreneur. Engage in a customer lifetime price strategy. This topic is deep and informative for business owners but, it’s for another tutorial. But the essence is this: set the price that will allow you to liquidate the whole basket of units of your product. For most consumer brands, a range that encompasses high and absolutes minimum price points will attract more customers from a wide spectrum of the market and encourage repeat sales. The customers who can afford to pay the full price will not be turned off by a higher price, and you can afford a little wiggle room in your price for those looking for a little discount.

Try these tips and come let us know how it worked. We love to read your feedback. It helps us to improve our services to you.

Dreams are free, the hustle comes with conditions.