Apr 24, 2023 • Podcast

How do I sell value in a commoditized industry?

Paul focuses on the challenge of selling value in a tough, competitive market.

Show Notes

It begins with attitude. If you believe your solution is the same as everyone else’s, that’s exactly what your customer is going to think. 

You must remind yourself that you are selling a unique, bundled package: the three dimensions of value (the company, the product, and you – the salesperson).

There is no commodity in creativity. Creatively add value to the customer experience.

Have you asked your customer this question: “What problems are you experiencing that I can help with?” 

Become customer-focused. View the world through the eyes of the customer.

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How do I sell value in a commoditized industry?

(Transcribed from podcast)

So last week, I was working with a group that is selling in a heavily commoditized industry. And I thought I’d make that the focus for today’s session because in the training seminar, a salesperson asked the question, “Hey Paul. How do I sell value when my product is exactly the same as everyone else?” And this is a challenge salespeople run into nearly every single day. Especially those in distribution, banking, insurance, other industries that become heavily commoditized. We’ve got to challenge ourselves and ask, “How do I sell value even in that tough competitive market?” So we’re going to get into that in today’s session.

Before we do though, this is a topic that really helped spark, ignite the Value-Added Selling revolution. In Value-Added Selling, we detail how to compete profitably even when your product is similar, even when you’re perceived as the same. You can pick up your copy of Value-Added Selling wherever you get your books: available on Amazon, Barnes & Noble, you name it, it’s there for you. Also, if you’re eager to learn how to sell on value and not price, join us for our public seminar. This will be scheduled for June 27th and 28th at our training center here in St. Louis. More details on that two-day seminar can be found on this episode’s show notes. So check that out.

Let’s get back to that question: How do I sell value even when my product is the same? So I’m going to share a few thoughts with you here today, and it begins with attitude. Attitude drives behavior. We move in the direction of our thoughts. So think about this. If you’re a salesperson out there listening right now and you think that what you’re selling is the same as everyone else, that’s exactly what your customer is going to think. It’s hard to convince a prospect or a customer that you’re selling something different, something unique, if you don’t believe you offer anything unique or new. Your attitude drives your behavior. So when we think about this, we’ve got to remind ourselves, first and foremost, that we’re not just selling a product, we’re not just selling a service, you are selling a unique, bundled package. In Value-Added Selling we call this bundled package the three dimensions of value.

Now, the three dimensions are the company, the product, and you as the salesperson. So those are the three dimensions, and yes, products can be similar. Sometimes they are exactly the same. But you’ve got to remember, too, companies are not exactly the same. So your company may offer unique value. There may be unique value-added extras that your company can offer its customers and prospects. Also, think about the other unique dimension—you as the salesperson. So even if two companies look and sound and feel the same, the product look, sounds, and feels the same, you as the salesperson remain that one, key unique difference.

Consider this for a moment. If you take two salespeople selling a similar product, working for the same company, it’s two different solutions altogether. Because those two different salespeople offer unique value. If one seller has 30 years of experience in the industry and the other salesperson is brand new, clearly the more experienced salesperson is going to offer more value. So we must focus not just on the product side of it. There’s too many companies just selling product, and if you just sell product, you open the door to too much competition. So, make sure that you’re highlighting that and showcasing the unique personal value that you bring.

Number two. There is no commodity in creativity. You could take any heavily commoditized product, and as soon as you creatively bundle in your value, it becomes a completely different solution altogether. So, it’s beyond just the product. We get so hung up on this idea that to be truly different, we must offer a unique product. No, that’s not the case. If you can bundle in your value-added extras in a unique way, it becomes a completely different solution.

I remember working with a client just a few years ago. And, this client would specialize in selling into power plants. So they would work with power plants, provide product and service when they were going through a turnaround. And during turnaround projects, certain sections of the power plant are shut down. And when the power plant is shut down, they’re not making money. So they try to limit this as much as possible.

So here’s what this company would do. They would take the same product that this customer could buy anywhere else—dozens of competitors in this area are selling the same exact product. But what they would do is they would provide all of the product and deliver it to a specific section of the project where the customer was working. And they would include any and all products they could potentially need on this project. So they would say, “Look, here’s everything you could potentially need during this turnaround. I know that you may run into something, and rather than waiting an hour or two for us to get the product there for you, we’re going to have everything you could potentially need on this project already. If you don’t need it, that’s great—we’ll take it back. But if you need it, it’s right here for you.”

Think about the amount of time that this company was able to save their customer. Because whenever they ran into something, they had the product there when they needed it already. Now, all of this product, again, is heavily commoditized. You can get it from dozens of other suppliers in town, but they find a way to package in their value. That’s a completely different solution. So again, there is no commodity in creativity.

The next thing—identify new problems to solve. Anytime your customers experience a problem and you’re able to identify the problem and create a solution, you are creating value. It doesn’t matter if you satisfy their needs by providing a commoditized product. If you identify the problem and solve the problem, you are creating value. You are creating distance between you and all of the other competitors.

One thing I encourage salespeople to do is ask the question, “What problems are you experiencing that I can help with?” When you meet with your customers, ask that question to various decision makers. Go to the shop floor, ask that question. Go to the top floor—ask the same question. What problems are you experiencing that I can help with? This question distinguishes you. This question helps you identify new ways to create value. So make sure you ask that question: “What other problems are you experiencing?”

And, the final tip: remain customer focused. I’ve come to realize that salespeople tend to focus on three distinct areas. Number one, they tend to focus on themselves. They tend to focus on the quota that they need to hit, on the calls that they need to make. They focus on the demonstrations they need to conduct. It becomes about the seller. That’s what we call seller-focused thinking. Now, the challenge here is, it’s hard to create value for someone else when all you think of is yourself—when you view the world through that prism. So we need to step outside of that.

The other type of focus is becoming competitor focused. This happens when we look at our competitors, we ask ourselves, “How can we offer something different than they’re offering? How can we create distance between us and them?” And I get that. That’s an important question because we have to be able to explain to our customers what makes us different, because they’re going to ask us, “How are you different than so and so?” Or “How are you any different than this way we’re currently doing it?” So we have to be able to answer that question. But when we constantly focus on just that one question, we end up focusing our attention on the competition versus our true potential.

And then there’s the final type of salesperson. This salesperson is customer focused. They are obsessed with the customer: with meeting their needs, anticipating their needs, identifying problems to solve. They view the world through the eyes of the customer. Oftentimes, salespeople appear to be a commodity product themselves, and it’s because they’re selling the same way as every other salesperson that walks through that door. If we want to truly be different, if we truly want to offer our customers something unique, we need to do something radical, and that is ignore the competition. Ignore them. Every time you look to your competitor as a means to differentiate, you end up limiting yourself to the edge of their creativity.

So instead of looking at what they’re doing and how they could be different, focus 10 times the amount of energy on your customer and figuring out what’s important to them. What do they care about? What outcomes can I help them achieve? If you want to be radically different in your approach to sales, focus on the customer, not yourself, and not the competition.

So when we think about it, again, just a few ideas to help you go out there and compete on value, even when you’re in a heavily commoditized market. Remember, number one, that your attitude drives behavior. If you believe that you are the same, you are going to be the same. Instead, focus on the unique dimensions of your solution, which is you, the salesperson.

Number two, there is no commodity in creativity. Look for ways to creatively add value to the customer experience. And, building on that, identify problems to solve. And ask that question, “What other problems are you experiencing that we can help with?” And then, finally, don’t focus on your competitor, don’t focus on yourself, focus on the customer.

Make it a big day.

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