5 Great Tips for Value-Based Sales Discussions by Ian Hirst, CEO, Greenbank Ltd
Have you heard these words somewhere before?:
'Honestly, it’s difficult to explain how we are different'
'Price is the only thing that matters'
'Buyers don’t seem to see the value in either our service or our product'
'They can’t justify changing from their current supplier'
As you read these phrases, do you hear echoes from your own sales teams?We wouldn’t be surprised because we hear those sentiments expressed regularly by sales teams worldwide.
So, given that you know your product or service is distinct from your competition and can deliver real value, how come you find it difficult to communicate this? Put simply, how can great sales people like you have great value-based sales conversations?
The business impact?
We live in an increasingly technologically-enabled world in which buyers can easily compare, contrast and (rightly) distrust product-focused sales pitches. For sales teams who don’t adapt their approach, there are some real consequences:
• Price becomes the most important criterion as customers fail to see suppliers as offering anything different from each other.
• Buyers are unable to see ROI from change so deals end up getting stuck early in the pipeline.
• Lower margins as a result of price conversations being held too early in the sale (before the sales person has had the chance to build differentiating value).
Value, of course, is in the eye of the beholder
This is a cue to return to two basic principles:
a) We know that people buy from those they like and trust.
b) Most buying decision are based on two main questions – which option offer the best value and the lowest risk.
Let’s take these one at a time:
Being seen as a trusted advisor
Ask customers (or indeed anybody!) why they trust or distrust a sales person and a common theme is that customers trust sales people who are sincerely interested in them as individuals and their business and have gone to the trouble of understanding their issues and drivers. The very top salespeople (see the recent CEB Challenger Sales research) go even further and demonstrate they also understand their clients own customers’ needs and drivers.
This can be tough and, in our experience, sales people often focus on what they know best — their own company’s products and services. Sadly, they rarely see their role as offering insights to their clients about their market or their customers’ business.
Value v Risk
The key thing here is that ‘value and risk’ are not defined by the seller, but are framed by the customer – particularly as many key value discussions happen when you are not there. Remember that even your best-loved leads have to see and believe the value you offer to be able to articulate that to other influencers in their organisation — and defend it when challenged by advocates of lower cost solutions.
So, understanding the business value each customer sees from a change in approach and then clearly articulating how your solution delivers this (and minimizes risk) is an increasingly vital sales skill.
5 Top Tips for Value-Based Business Conversations
1. Really understand the end business value you create
We’ve found that few companies fully understand the true value of their products and services to customers. This has got to go beyond technical elements like better processes and information to the actual end business benefits, which start to justify your solution. These three steps will help:
• Outline the economic benefit: How will your customers’ business benefit from using your product – in the private sector, this normally means increasing revenues or saving cost. For public sector clients, it can be delivering against targets. Make sure this is the end business result that a senior executive would buy into and put numbers against it – and ideally what the client has already told you!
• Clarify the technical ‘enablers’ that will support the achievement of these economic benefits: this can include better management information or less duplication.
• Show how your service is uniquely equipped to deliver these enablers. This could be dedicated project management or some technical differentiator.
2. Really (really) know your customer groups and their market drivers
You can do this by organizing your sales and marketing teams and aligning them with their customers, for example by sector. If you are focused on selling (for example) just to Pharma clients, rather than having a broader geographic-based sales patch, you are much more likely to understand your customer’s drivers and the compelling events that are shaping their business.
3. Become respectful educators rather than transactional salespeople
Use this expert knowledge to update your customers on trends in their market – what their customers are valuing, the legislation that is coming down the track, how other companies in their marketplace are adapting to the macroeconomic changes affecting us all.
4. Even then, don’t make assumptions
Each individual customer is different, so take the trouble to understand this difference. Don’t make assumptions about what your customer values in a solution and how exactly they will measure this. To counter this tendency, become an expert questioner so that you discover, for example, what ‘risk’ and ‘quality’ really means to them.
5. Align your culture and reward mechanisms
There is no point in encouraging sales teams to be high-margin, value-based salespeople if you then reward them as transactional sellers. You may need to change your company’s emphasis from revenue to margin and reflect this in your salespeople’s pay. Accredit salespeople as Certified Value Based Sellers and pay them accordingly. In short, develop a company culture that acknowledges and rewards value-based selling!
Free value-based selling workshop
We hope you’ve enjoyed this short article on the benefits of value-based selling and it has whetted your appetite to hear more. As part of Sales Innovation Expo, we’re going to be leading a workshop on this very topic:
Do your sales teams consistently articulate your business value to clients, especially at senior level? This engaging, highly interactive seminar will introduce a proven tool to both revolutionize your sales teams approach executive conversations and sales pitches and make a measurable difference to your sales success.
We’d love you to be part of this highly practical and resource-rich seminar.
If you can’t make it to the workshop, please come along to meet us on our stand. We are at S194. Alternatively, you can find out how we can help drive your sales growth and achieve your business goals by emailing Ian, at email@example.com or visiting our website: www.greenbankltd.co.uk.