When Value Means More Than Cost
By Michelle Nichols
Radio commentator Paul Harvey likes to tease his listeners with, "...and now, for the rest of the story." In sales, there is also a rest of the story after you connect with prospective customers. While a customer connection is important, it doesn't guarantee you'll win the business. You also need a compelling value statement. Otherwise, after all your hard selling work, your reward will be only a nicer, "No, thank you."
Just as the foundations under your home are essential, they're not enough in themselves to keep you warm and dry, let alone provide a place to plug in your big-screen TV. Likewise in sales: A good customer connection is the foundation for a successful sale. It allows you to start a sales conversation. However, to earn a customer's signature on the dotted line, he or she must feel your proposition provides so much value that fear and buying inertia is overcome.
Another way to think of presenting a "compelling value statement" is proving relevance. When you're in front of your customers, don't blather on about the wonders of your product or service.
Rather, show how useful your offering is to solving their problems. Depending on what's most important to your customer, relevance could be based on price, size, speed, delivery, financing, colors, or a dozen other meaningful characteristics.
For instance, you may be selling the lightest laptop computer, the quickest accounting services, or the thinnest watch, but if those qualities aren't relevant to your particular client, you probably won't get the sale. Who knows? Maybe your customer doesn't mind a heavy laptop because she never takes it out of her office, or likes the anticipation of waiting two weeks after the month's end to find out her profit results. Perhaps he likes how his current watch bulks up his wrist and makes him look studly.
Bear in mind that the value may not come from just the most obvious measurements, like dollars per square foot in real estate or return on investment in equipment sales. Sometimes, it comes from ancillary sources, like the customization that is available, reputation implied, and high levels of customer support. For instance, if a supermarket wants to add an in-store coffee bar, it may pay more for a name brand like Starbucks (SBUX ) because of the image and brand are perceived as reflecting on all the other products on the store's shelves.
One of the most powerful ideas I've ever heard goes like this: A qualified prospect must benefit from buying from me personally, professionally, and politically. I've found that this acid test helps me identify and articulate compelling value statements for my future customers.
"Selling value" is an age-old sales strategy, but here's a quick review. To start, ask your current clients what benefits they receive by buying products from you. Notice that I didn't ask what benefits you, the sales rep, think your customers get. You want to hear their thoughts in their own words. This will give you insight into your clients and, as a bonus, some fresh testimonials to impress future prospects!
Next, discover which target markets have lots of customers who would place a high value on those benefits. For example, if your current clients rave about the reliability of your products, then find a large group (or several large groups) of customers for whom that characteristic is essential. This guarantees you a much higher closing rate and selling "speed" because most of the members of that target market really want what you offer.
The next step is where a lot of salespeople make their fatal mistake. Go to your prospects in those target markets and ask them if they would like those benefits. Do not assume each prospect will place a high value on them. Target markets are not homogenous -- not everyone is motivated exactly the same way.
The bulk of the frustration in our profession comes from the chasm between how valuable the salesperson thinks his or her offering is and how valuable the customer perceives it. From your point of view and experience, you may be able to see several different ways your offering can save the client money, time, and stress. Sometimes, the client won't see things the same way you do.
So what should you do if, to paraphrase the title of a currently popular book on dating and relationships, they're just not that into what you offer? First, try to increase the perceived value of your proposal. Help prospects to see how many ways you can save them the time, money, and stress I mentioned earlier. Encourage them to dream about how their lives and jobs will improve if they buy from you.
THAT EXTRA SOMETHING.
If your competitor can do something you can't, and it's important to your customer, try to counter this with a compensating benefit -- something only your offering can provide that would also add value to your customer.
As a last resort, you may have to raise your value by adding something else, perhaps some supplies or an extra month of service or better financing terms. The most effective way to add value is to ask your clients for suggestions. Maybe they want just a little extra off the the price, or maybe its something as trivial as a promotional giveaway or a new set of wipers for the car you're trying to move off the lot.
Today, building personal connections to your customers and demonstrating the compelling value of your offering relative to their situation are two strategies that are increasingly important to achieving success. Ignore this lesson at your peril. Follow it, and believe me, you'll close more sales. Happy selling!
Edited by Rod Kurtz