Get in the habit of selling value over price

By Walter Rogers
President and CEO
Baker Communication

Because of the relentless pressure to drive revenue and close business, all sales professionals are very familiar with the temptation to discount or give ground on other terms and conditions in order to win the business. With the customer right there dangling the deal carrot, and the end of the month or quarter closing in fast, many sales professionals will take the money and run - especially in a down economy - even if it means giving up margin to do it.

However, highly successful sales professionals understand that their company relies on margin and brand reputation to maintain viability and leadership in the market place. They have also discovered time and time again that you earn bigger deals and build long-term, highly profitable relationships when you sell value over price, because customers are more than willing to pay a premium for something that truly delivers extra value to them. That is why it is so important for sales professionals to understand what the customer truly values.

Simply put, if you want to sell value to your customer instead of being forced to discount price to close deals, the most important thing to remember is not to lead with product features and deals, because customers don‘t by products. Instead, they buy solutions that will give them the outcomes they need to make their business more successful. Therefore, before you can present them with an attractive solution, you must be certain that you understand the customer‘s business drivers so you can connect that solution back to the customer‘s most important business goals and desired outcomes.

We have already discussed how important it is to focus on helping the customer meet his needs rather than simply trying to sell them whatever your flavor of the month is. We have also emphasized that in order to do that effectively, you have to become highly skilled at asking your customer the right questions and listening carefully to make sure you understand their answers. Perhaps now you can more clearly understand why this is so important; if you can master these first two steps, you are going to be very will positioned to sell value over price.

Bridging the Understanding Gap

The challenge faced by most sales professionals is that customers cannot recognize (presale) the value of your solution without your help. When the customer does not clearly understand your value, they will focus on the one thing they do understand, which always comes down to price. Highly successful sales professionals understand this, so they work to bridge that understanding gap by focusing the conversation on the things that truly matter to the customer.

Many sales professionals are not very effective in this area. If they attempt to discuss value with the customer at all, they tend to say things like:

• This product will help you stay on time and on budget
• This "feature" will do this, and that "feature" will do that
• This product or service will improve your process by doing X
   

As important as these points are to make, they don‘t go far enough because they don‘t clearly spell out the ultimate value of what is being offered. Selling value requires that salespeople have the ability to justify – in terms that the customer cares about – how the customer will benefit from their solution. Unless the sales professional can deliver this message and connect the dots very clearly, they leave the customer no choice but to view their solution as just another commodity where price becomes the only consideration.

Remember, the only reason a customer buys anything is because he has goals and problems that affect his business, and he needs solutions. Most concerns that become buying forces fall into three main categories, known as PPI:

• Productivity – expediency, efficiency, increased output
• Profitability – making money, return on investment, increased profit margin
• Image – style, reputation, public relations
   

Never forget: The customer is focused on one thing, his own priorities. It doesn‘t make any difference how wonderful your product is or what a nice person you are. Your customer isn‘t looking for a new best friend, he is looking for specific solutions or benefits that resolve the gaps in his business. The key question he wants answered is:

"WHAT‘S IN IT FOR ME?"

Now, if you have done an exceptional job of asking good questions and listening carefully to the answers, you should have a very good understanding of what the customer is looking for. Actually, if you did a good job of clarifying and confirming the customer‘s answers, you have essentially gotten explicit agreement from him regarding what he is looking for. When the customer explicitly states his needs, the chances of having a successful sale increase. Therefore, it is vital to obtain explicit needs statements from the customer.

However, even when you obtain confirmation from the customer regarding his explicit needs, your job is just beginning. Now you must help him see that your proposed solutions are perfectly aligned to meet those explicit needs.

Feature – Advantage – Benefits (FABs) make all the difference

In order to create this alignment, you must create and deliver clear Feature-Advantage-Benefit statements (FABs) that will help the customer see the whole picture.

FABs have three parts:

A FEATURE is a particular design or performance enhancement. Features relate what the product does and especially delineates those characteristics that make it special. For instance, an automobile might have features like a 3.2 liter V6 engine, anti-lock brakes, and side-curtain airbags. Since these things don‘t come standard on all cars, they become features of a particular model.

This is step one in explaining your product to a customer. Features are very important, but features alone won‘t sell a product. Sales professional too often get bogged down in explaining features and sometimes lose customers in the process, for the simple reason that a customer also needs to understand the advantage that a feature provides.

An ADVANTAGE defines what the feature accomplishes, and why that is a good thing. For instance, a 3.2 liter V6 engine will generate very good acceleration if you need to merge onto highway traffic. However, it might not be attractive to someone who wants the absolutely highest gas mileage, or who only toodles around city streets in light commuter traffic, so not every feature and advantage will appeal to every customer, no matter how cool that feature may seem to the sales professional.

Finally, the advantage has to offer a BENEFIT that the customer identifies as valuable to him. At this point, you, as a sales professional, must be careful. Just because a benefit seems valuable to you is no guarantee that the customer will see it the same way. A huge part of sales success revolves around making sure you clearly understand what the customer cares about. Then – and only then – can you connect your product‘s FABs with those needs in a way that might interest your customer. Simply put: a BENEFIT states how the ADVANTAGES of a FEATURE relate to the customer‘s concerns and expectations.

Let‘s say you are a car salesman, and you are working with a customer who told you he had recently skidded on slick streets while driving a carload of kids to a birthday party. At this point, you would be wise to politely ask if safety was an important concern in his new car purchase. The chances are very good that he will say yes! This gives you the opportunity to point out to him that among the FEATURES of the car under consideration include anti-lock brakes and side-curtain airbags, which offer the ADVANTAGES of being very effective at eliminating skids, while also providing better protection for passengers in the event of a collision. Now this ADVANTAGE becomes a valuable BENEFIT to him, because he sees that his family is going to be much safer whenever they are traveling in their new automobile.

Here is how you would set up a FAB statement in this situation that would help the customer see the value of your solution:

Sales Professional: "It sounds like the safety of your passengers – especially your family – is very important to you. Am I right? Well, if that is the case, I would like to show you this model over here:

Feature: "This model has a special inertial dampening bumper system, plus side curtain air bags and anti-lock brakes."

Advantage: "The car will stop faster and more safely, even in dangerous driving conditions, and all of the passengers will be much better protected in the event of an accident. Also, the government has awarded this model a 5-star crash safety rating, which is only awarded to about 10% of all vehicles tested every year."

Benefit: "If safety is your primary concern, there is not a vehicle on the road today that will keep your family safer than this one."

Until you know what BENEFIT (or outcome) is important to your customer, and until he clearly sees that your product offers him that benefit, you don‘t usually have a chance to make a sale. He may agree that you have wonderful features and advantages, but those things have to meet his needs and fit his motivation for buying. Your challenge is to ask good questions, listen to his needs, understand his motivation, and then and ONLY then, recommend solutions that offer real value to him because they solve his problem or meet his need. However, when you do this, your ability to sell value over price increases dramatically, along with your ability to drive more and more revenue with this customer year after year.

Action Items:

• Try writing two or three different set of FAB statements that will connect your products and services to the typical needs of the customers you work with. Make sure that you provide a very focused benefit component that specifically defines how the product will solve the problem or meet the specific need of a customer.
• Review your current questioning and listening strategy. Are you asking enough questions with every client to be able to build a set of FABs that will clearly address their needs?
• Make a list of 5 more questions you could ask that would help you create more effective FAB statements.
   

Walter Rogers is the President and CEO of Baker Communications. Baker Communications is a sales training and development company specializing in helping client companies increase their sales and management effectiveness. He can be reached at 713-627-7700.

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