As sales people we are always having it drummed into us that we need to build the value of what we sell and how we sell it.
This is absolutely true but it’s a little more challenging to actually define what value is because it’s all down to our clients’ perception.
What we feel is value might not be in the eyes of our clients and hence this is why it’s so vital to do a thorough fact find before we even start to present our products and services because what we present will need to be done in a way that resonates with the clients requirements and what is value according to them.
So what’s the end goal with this?
You’ve got to appreciate that all throughout your sales interaction your prospective client is running a meter in their heads. This meter is calculating a theoretical number of how much they think your product or service is going to cost them financially.
They are also running another meter in their head for the other costs associated with your product. These are not the financial costs but the costs of change.
Will they have to change their existing supplier? Will they have to train staff to use the system? All of these factors and lots more besides are being added up!
Some of the things you say will add to the “value” and others won’t.
Now once you’ve finished with your interaction, demonstration or presentation and you reveal the price is just $2,500 and their meter is at $9,000 then you have built the value perfectly. It’s as though you’re asking them “Mr Prospect, how much do you think this is going to cost you?” They then reply with “$9,000” only for you to respond with $2,500. Now that’s value!
The value equation
There’s a simple equation that you can use to help mould your questions and approach to building the value with your prospects and clients.
The value equation dissected…
PB = Perceived Benefits
The perceived benefits are the benefits that your prospect thinks are important to them. You should know your product/service benefits inside out anyhow and by effective questioning you’ll unearth which of your benefits will be most suitable for them. Don’t just perform a “benefits dump” on your client. They need to be closely matched to their situation.
PP = Perceived Price
This is the price of the product or solution and your prospects perceptions about that price.
PC = Perceived Costs
A lot of sales people forget that there are costs associated with every sale. What we’re talking about here are the costs of change. The costs and time it may take to migrate the systems over onto a new platform, the upheaval in having to train everyone on a new system or the consequences and costs to the decision makers career if they make the wrong hiring decision.
All of these factors need to be taken into account when you build the value.
Don’t just focus on the benefits all of the time. Bear in mind the costs of change too because these are very important to the prospect and could be the ultimate deciding factor in similar products and services.
For the products and services that you sell write out the equation on a piece of paper and fill in the blanks. Think about the benefits that your product or service has and write them above the line. Think about the perceived costs and write them down too.
Then, for your next prospect meeting think about all of the questions that you can ask that will give you the chance to talk about all of the statements that will build the value for that particular prospect.
Remember that value is all down to the perception of your prospect or client.
They are not mind readers and you’re not too. So you need to go into each and every meeting with no preconceived ideas but with a framework and some areas that you will develop throughout the sales interaction that will ultimately lead to their figure (i.e the price they have in the head) being way above the actual price when you reveal it!
Author Credit: As a sales expert, Sean McPheat is asked to help businesses to improve their sales through consulting, coaching or training. He is also the managing director of MTD Sales Training, the internationally renowned sales improvement firm where he leads a team of 25 sales trainers who have delivered sales solutions to over 50,000 staff. Follow Sean online here.