Value selling is an important sales technique that relies on showcasing and building on the core value of your products & services.
This philosophy of sales can be one of the most effective techniques for generating income, enhancing profit, and gaining long-lasting customers.
When selling value, you and your team focus less on the price or product itself, and more on the benefits. It’s the idea that no one wants a power drill, what they want is a hole in the wall.
Because selling value focuses so strongly on the benefits that a customer receives, it can be much more effective for closing deals and generating profits. People are much more open to hearing about the benefits of a product or service; these details stick with them, while a spec, stat, or feature may not.
Which of the following sounds more appealing to you?
“This CRM system can help you file over 500 million contact points, gives you over 1,000 product categories, and is completely scalable.”
…or…
“When using our organising system, you’ll be able to easily store and access all of your customers’ contact information and grow the system alongside your company.”
As you might have guessed, it’s the second pitch, which focuses on value and benefits, that closes a deal more consistently.
When you sell value, you not only emphasise benefits, but you also focus on people. You demonstrate to customers that you don’t just want to sell an item, you want to help them. You ask questions and create real, personalised solutions & client relationships. This not only leads to more referrals, it leads to more sales with that particular contact.
There are numbers that support the value of a long-lasting business relationship. According to the this Harvard Business School study, increasing retention rates by 5% can increase profits by as much as 95%! Because you have promised and delivered, you now have their trust, which can lead to up-selling, cross-selling, and more sales in the months, years, and decades to come.
So, how do you go about adding value selling to your sales toolkit?
Each part of the value chain should be consistent from one stage to the next, providing a smooth, seamless, and of course valuable experience for customers. When all these are perfectly aligned and working well together, you increase your chances of selling more and reaping greater rewards.
Be careful not to make false assumptions about why your prospects make the choices that they do. Each person or business values different things. There is no one-size-fits-all model of what a prospect will value the most about your products or services. Or of what makes that value rise and fall.
A classic example used in sales training is a glass of water. To a man dying in the dessert, it’s worth the price of life. To somone standing next to a tap, almost worthless.
The key is to find out what value looks like to each person. You can ask directly, or you can notice how they come across, appear, and act in front of you. Pick up on the signs! And then you must influence their perception of value, Prospects don’t buy features. They buy something that is going to solve their problems, which is what creates the value for them.
To identify what is of value to customers is to understand the problems and difficulties they face and what they view as priorities. Understanding is not a pile of stats or demographics.
It is about knowing the personal needs of your prospects, their hopes and aspirations as well as real insights into their industry and what they are up against.
The process starts with research and gleaning as much information about your prospective customers and their business environment. You can research industries by reading websites, social media, articles and reports. To create an accurate picture of your prospects, you can conduct market research, surveys, fact gathering exercises and ask direct questions.
Use your time with them to ask searching questions to draw out information that you can use to add value.
We’ve looked at how best to go about identifying what your prospects value. As your relationship with them deepens and your understanding of their situation improves, the next step is to create the value. This involves specifying how your products and services are the solutions they need. However, this is one of the biggest challenges salespeople face.
According to a Gartner survey of executive buyers, 74% said that their salespeople concentrated too much on the product, and that only about a third of salespeople were able to communicate the business value effectively.
Value selling does not have to be this complicated. There are many simple things you can do to ensure that your customers receive incredible value from you.
When we are talking about creating value, we mean unique, not generic value. This is where your solutions are tailored to an individual customer’s needs, and it is vital to your selling success.
How do you create unique value for your customers?
Firms are not in business to save money; they exist to grow and make money. When creating your value proposition, direct the conversation to how your offering will boost opportunities, minimise risks, lead to productivity increases, deliver greater profits and create market share growth. Don’t just pluck these phrases out of mid-air, quantify with real-world examples:
Go beyond just the features of a product. Substantiating and proving how your products create value is an effective way of getting your prospects to believe and trust in you.
Armed with your deep knowledge of your prospect’s industry, needs and aspirations, wrap part of your sales discussion in a scenario and/or illustrate with case studies. Instead of blasting the person with information, present a situation that allows the customer to see how your offering could be valuable to them. Let them draw their own conclusions and figure out why they should buy from you. Business storytelling is something we specialise in at natural.
If you talk about your products as you would any commodity, you become interchangeable with your competitors. All your customers will see is just another pile of products. This is where good storytelling comes in. If you think you are just selling a product, so will your prospects.
Remember, sales discussions aren’t about you, but you do need to build up the customer’s confidence in your offering and your firm. Part of this is talking about the history of your company, mentioning past successes and drawing attention to testimonials. With third party verification you are letting your other customers do the selling for you. They are concrete proof of the value of your offering.
Prospects need to understand what will be better for them if they purchase from you. When it comes down to it, your customers have no interest in your products and services. They are only interested in how your products and services can rock their world.
Convincing your prospects of the value of your products is one thing, now you have got to deliver.
Failing to deliver the value they expect could seriously harm your chances of ever doing business with them again, as well as your reputation going forward. Delivering value is about being authentic and 100% true to the value you have identified and created.
For example, if a stellar customer service department that responds to queries in under an hour was part of your value proposition, and your customer has had to wait two days for a response, you have failed to deliver on the value you promised. And you know what? That client will talk to their colleagues, suppliers and other contacts about how your poor customer service caused them serious problems.
There could well be a number of reasons that affect your ability to deliver on the value you promised. In the above example, staff illness and computer breakdown could have stymied efforts. But if you have promised to deliver something without equivocation or exception, you simply have to deliver.
As a salesperson, you may believe it’s not your job to keep an eye on whether your company is delivering the value you promised that helped you to close the sale. If that is how you think, you could be missing out on lots of future sale opportunities as well as long-term partnerships.
Often, companies that get it wrong do so because there is a disconnect between their sales division and the operations department. Salespeople are busy selling the dream, sometimes making promises that are impossible to keep in order to get their prospects to sign on the dotted line. Or they miss a few details, either deliberately or by accident.
However, it’s not always the fault of those in sales. Sometimes operations lets customers down by losing sight of what it is they value so much.
So, own the relationship with clients. Check back in with them regularly and make sure everything is being delivered up to spec. And if it isn’t, ensure that the operations side of the organisation picks up the slack.
To help you deliver value, draw up a checklist of the promises that sales make and the ways that operations can deliver.
But, there’s even more to delivering value than this. Part of the equation is looking to identify areas where you can offer even more value. Are there places where you can expand on the existing value you are delivering?
Some of the most successful companies are those that go the extra mile to put a smile on customer faces by exceeding their expectations.
Online sporting retail company Wiggle.com puts a free bag of Haribos in with customer orders. Tesla have mobile technicians who can complete most repairs wherever you park, saving you the hassle of taking your car to a service centre.
Value is in the mind of the customer, an intangible concept that only exists in their thoughts. It can be low price or high quality or any number of things that helps a customer achieve their goals. If customers don’t perceive the value they are getting from your company is what they expect, then they will go elsewhere.
There needs to be a system in place to measure the delivery of value to customers, of acquiring a better understanding of precisely what customers value. A lot of companies will just sit back and wait for customers to tell them how good or bad things are, but if you take control of the value discussions you can better understand how much value you are providing.
Businesses give themselves a strong competitive advantage by knowing what customers value, how to deliver that value better than anyone else and when to communicate with customers to ensure they are perceiving the true value they expect.
To help you determine the value that’s perceived by customers, just ask. Usually this is with customer surveys, but inject them with questions designed to uncover more about value. For example:
· How much value are we delivering to you? Can we deliver more?
· Do we meet or exceed your expectations in the following key areas?
· We value our relationship with you. How can we serve you even better to provide you with extra value?
Assessing how well your products and services stack up to the answers and making appropriate changes will help you to deliver the value that keeps people coming back for more. And measurement is not a one-off exercise. It is a continuous process that helps you to always look for ways of improving the value you are creating.
Understanding how valuable customers find your offering has a number of benefits. Not only do you keep that client and possibly sell more to them, but you can attract new business by demonstrating how existing customers are receiving outstanding value from what you do. Showing prospects a healthy return on investment will bolster your business case.
Measuring quality can help your sales in other ways too. Quite often clients will see a purchase as a discretionary spend. That is, they don’t have to spend the money if they don’t want to. But your comprehensive understanding of value may help you to turn you offering into a non-discretionary spend – a must-have!
For example, you could say something like this to a client: “You’re not only getting presentation training, but you’re getting presentation training that will enable your sales team to win more pitches by 30%.”
Being able to measure value allows you to make a stronger more irresistible pitch.
If you or your team need help putting these 4 stages into practice, check out our Value Selling Training.
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