When I was a young sales executive I was told to go out and win the sale at any cost, that was many years ago. However, decades later I still find companies following that same path and selling their companies to destruction.
I am frequently asked by senior management to help them overturn a sales-focused philosophy that is commoditising their products, reducing their profit margins and killing their brands. They ask me to show their sales people how to sell value and charge a premium for it.
Where do you start to address this?
Well, a simple fact is, that unless you know your customers you can’t really sell value. Yet virtually every sales person that I have ever met, has told me in no uncertain terms that they know their customers. They usually react with a look of; how dare you ask me that? “Of course I know my customers.”
Until I ask them to tell me, what are your customer’s key success factors that they have to meet in their market, where do they lack capabilities in their company to meet those key success factors, what are their priorities, and what is their strategy?
This usually results in silence, or a muddled attempt to explain what benefits the sales person’s product gives to the customer.
That is the truth of it, most sales people don’t know the customer, they may know their product and they may know the buyers, but that is not enough to avoid conceding on price. It is right at the heart of what causes your products to become commoditised.
They don’t know what drivers in the customer’s market are creating challenges and opportunities for the customer, and they fail to discover which decision makers in the customer’s company will be particularly affected by those challenges. Those decision makers are often the most influential people who have considerable power and they can become very important allies in helping to win contracts without resorting to price reductions.
On so many occasions it has been possible to engage with decision makers that sales people do not normally communicate with, and to become the preferred supplier by showing them how you can help them meet the challenges that matter most to them.
However, this approach takes the sales person out of their comfort-zone and requires them to discuss issues other than product and price. So even if you engage with those decision makers, your sales people lack the confidence and the will to enter in to discussion with them.
However, there is a way to overcome that barrier, by educating your sales team to understand the customer better and to understand strategic selling. As a result, sales people can begin to involve colleagues from marketing communications, product management and other disciplines in a plan that will engage with multiple influencers in the customer’s company.
The sales people will continue to sell the product to the usual decision makers, but by working with colleagues to engage with, and influence, the customer’s other important decision makers, they will create important allies who can influence the purchasing decision.
In addition, your company will be able to discover new aspects of value by engaging with a wider group of decision makers in the customer’s company and those aspects of value can help you to prove that you can offer more than your competitors can. You can move the customer’s focus away from price and onto value.
One final point is, that where a strategic selling approach has been applied correctly, sales people have been able to sell without reducing margins and it has become easier for them to convert customers.
All of which, means that they reach their sales target and their profit targets and they earn more. They don’t know what an opportunity strategic selling is for them, until they have applied it.
And the great benefit for your company is that you move out of the cycle of ever-reducing margins, commoditisation and brand destruction.
However, they have to adopt a different mind-set, learn new principles and skills, start thinking strategically and enlist the support of colleagues in marketing communications, product management and other disciplines. That is why I developed a course entitled ‘Strategic Selling and Value Propositions for Business to Business Companies’.
Evidence shows that the best way to avoid selling a company to destruction, is to adopt a strategic selling approach that is truly customer centric.