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Can You Still Compete on Your Value Added?

By Paul Reilly

Sales organizations are facing familiar challenges at unprecedented levels. There are top-line pressures impacting your organization’s profitability. These topline pressures include “sameness,” technology, and a culture of cheap. “Sameness” is the commoditization of products and services. “Sameness” is a combination of blending in and a lack of differentiation. Organizations sound, look, and feel the same. If everyone is the same, price is the primary factor buyers use when making a decision. How can distributors be considered outstanding if nothing about them stands out?

When attempting to stand out, distributors look at their competition and copy them. This creates more of the same. Rather than focus on what competitors are doing, focus on your own potential. To battle sameness distributors must answer this question, “What are our definable and defendable differences?” Technology has given buyers greater access to information. Professional selling is a people business, but technology has de-personalized the relationship.

Technology has made purchasing more transactional. Technology has given birth to a plethora of online sellers offering customers multiple choices.

After reading this article, google the term “material handling equipment.” You will get millions of results and plenty of pricing information. With technology, buyers have more transparency. In fact, many buyers scour the internet to establish a cheap anchor price. This cheap anchor price sets an expectation. It’s no wonder that salespeople face constant pricing pressure.

We live in a culture of cheap where the word value has become a euphemism for the word cheap. A culture of cheapness intensifies pricing pressure. Buyers are trained to look for cheap prices. Retailers use low prices to attract shoppers. Once shoppers enter a store or go online, retailers reinforce cheap prices with clearance aisles and coupons. Buyers are taught to focus on price. When was the last time you watched a commercial and the company bragged about high prices?

We live in a culture of cheap where cheapness has become entertainment. You can watch Extreme Couponing on TLC or Down East Dickering on A&E. In each case, the focus is on cheap prices. These shows have glorified getting a cheap price.

Salespeople have always faced the threat of a cheaper competitor. Today’s sales professional faces the same challenge at unprecedented levels. It might seem like price is the only way to compete, but it’s not. Our internal research shows that price is not the most important aspect of the solution. Buyers only focus on price in the absence of value.

Value-Added Selling continues to be a content-rich message of hope. You can compete aggressively and profitably based on your total value and not on price. The need for this message has never been greater.

Value-Added Selling is built upon a timeless philosophy: Do more of that which adds value and less of that which adds little or no value. This message will always be relevant. Would a customer ever say “Please bring me less value?” The philosophy is timeless.

The Value-Added Selling philosophy and principles are timeless. Fundamentally, the process has not changed. However, the business world is changing and evolving. Here are some ideas to help you compete more profitably in today’s selling environment.

Focus on Small Wins

When salespeople are approaching a new opportunity, it can be exciting. They are motivated and inspired to capture the big opportunity. Big opportunities excite, inspire, but eventually frustrate salespeople. Capturing a large opportunity takes time. There are setbacks and resistance. Sometimes the opportunity is so large that the salesperson doesn’t know how to get started. The best way to stay motivated and engaged is for salespeople to focus on the next best, immediate outcome they need to achieve. These next-best outcomes are called small wins.

Value-Added Selling is a consistent process. It’s not just one sales call, it’s a campaign filled with small wins. Small wins are concrete outcomes that lead to moderate progress. One small win might seem unimportant, but several small wins will generate momentum. Big opportunities are captured through small wins. Rather than focusing on the big victory, just focus on achieving the small wins that will lead to that big victory.

Managing Multiple Decision Makers

Today’s sales professional must be able to manage a group of decision makers. Our latest research shows that today’s buying groups include six people. It’s no longer realistic to call on just one or two decision makers. Selling to a group of individuals is different than selling to an individual. Since groups buy different, you have to sell different.

In a group, people seek conformity. Individuals in a group will go along with the majority even if they don’t agree with the decision. Imagine you’re pursuing a large opportunity. Your main engineering contact is sold on your solution. The engineer tells you that your solution is the front runner. Then your engineering contact presents your proposal to the committee, however, the committee is not sold on your solution. The committee has a cheaper alternative they are considering. After more conversation, a majority of the committee wants to go with the cheaper alternative. Because of the engineer’s desire for group conformity, the engineer will go along with the group.

Today’s sales professional manages large, complex opportunities with multiple decision makers. Salespeople must have a crystal-clear understanding of the buyer’s process, decision-making criteria, and each decision maker’s definition of value. It’s no longer feasible to just sell one person on your solution. You must convince the group.

You can still compete aggressively and profitably by selling value and not price. Value-Added Selling requires the commitment of everyone in the organization. Although the principles of Value-Added Selling remain timeless, some of the tactics have changed. More people are getting involved and buyers appear to be more price sensitive than ever. To overcome these challenges, salespeople must adopt a small-wins approach. Buyers want value more than they want a cheap price. Price only becomes an issue in the absence of value.

Paul Reilly is President of Reilly Sales Training. Reilly Sales Training is a St. Louis-based, privately owned company that specializes in training sales professionals, sales managers, and service professionals. Reilly Sales Training offers public seminars, in-house sales training programs, and hiring and training assessments. For additional information on our training programs, call or e-mail Paul at 636-778-0175 or Paul@ReillySalesTraining.com. You can also visit www.ReillySalesTraining.com and sign up for his free newsletter.