Attention, bargain shoppers! In the realm of business-to-business (B2B) sales, blue lights, doorbusters, Black Friday sales, or penny pinchers don’t apply. That said, in our ever-evolving battleground, the age-old theory that "everyone buys a bargain" still holds.
But what exactly indicates a bargain in our B2B world? It's when the perceived value of a product or service exceeds its cost. And here's the kicker: the greater the value, the better the bargain. So, as a salesperson selling a product or service that is not the lowest cost, your primary role is to prove that the value of what you're offering far outweighs its cost. Even when facing competition with lower prices, you can win the deal by showcasing that your product or service is the superior bargain. This is the essence of value-based selling.
And the stakes, already high, have never been higher: A recent Accenture study found that 80 percent of B2B buyers have switched suppliers at least once in 2 years. Great for you if you are on the prowl to steal share; lousy if you are on the losing end.
So, how do you create this elusive value that sets you apart from the competition and wins the trust of your clients? Let's dive into the art of value-based selling and explore the five steps that will help you boost your bottom line.
The foundation of value-based selling is understanding what your client truly values. Their "radio station" is constantly tuned to WIIFM (What's In It For Me). To create value, you must understand and empathize with their needs, objectives, and pain points. The better you can align your product or service with their desires, the more valuable it becomes in their eyes.
A study by The Rain Group, a leading provider of sales training solutions, listed the “Three C’s” that sales winners do differently to secure deals. These are Connect, Collaborate, and Convince. I added a 4th, Communicate.
Trust is the cornerstone of value-based selling. It's like a mathematical equation:
Trustworthiness = Credibility + Reliability + Intimacy / Self-Orientation*. The lower your self-orientation, the higher the trust. In other words, when you focus less on yourself and more on your client's needs, trust blossoms.
When trust is firmly established, your influence over the client grows. This is a pivotal factor in value-based selling. Ask yourself: How can you leverage this trust to create more value?
One way to create more value is to apply a strategic process when presenting proposals that can gain you several advantages. First, you can demonstrate that you understand the “Client’s Why” in their interest in your product or service. Therefore, each proposal should begin by emphasizing and confirming what the client’s objectives are; next, tie your services and their application/benefits back to those objectives; and, finally, before presenting the cost, ask for feedback from the client after each section of the proposal to make sure that everything discussed in the proposal aligns with the client's needs. This ensures they understand how your product/services effectively meet their needs. Following this approach creates value and increases the likelihood of winning deals, ultimately boosting your bottom line.
One last thought on proposals: In any competitive situation, present them in person rather than emailing them. If a proposal is emailed to a client, what section do they turn to first? The cost, of course. If the client does not like the cost, you are sunk. By controlling the presentation of the proposal, you can present the proposal in the order that ties your value back to the client’s objectives, maximizing your chances to demonstrate the “3 Cs” and win the deal.
To solidify the client's confidence in your product or service, recap the mutual understanding you've built with the client. This demonstrates that you and the client are partners working towards common objectives. Then, review the cost. If you have followed this process, it should be evident that your offering is the best bargain for the client.
Remember, the art of value-based selling hinges on understanding your client's needs, following the “4Cs”, building trust, and creating influence. These steps are like building blocks, allowing you to establish your product or service's value effectively. Remember, it's not about the lowest price but about being the best bargain for your client.
Following this value-based selling approach is even more critical in today’s economy as clients seek ways to increase bargains. As a salesperson, your ultimate goal is to demonstrate that your value surpasses the cost, making your product or service the best bargain and clear choice for your client's needs. A sales team in any industry that masters these principles will boost their firm’s bottom line.
* From the Trust Equation created by Charles Green