Paul shares the common barriers salespeople experience when attempting to sell value.
Salespeople will say, “That customer only buys on price, they’re a price shopper. They won’t buy value.” Well, then why are you wasting your time trying to sell value?
Only 1-in-6 buyers are true price shoppers. Buyers are only objecting because they don’t see your value.
“I don’t want to offend my lower-level contacts by going over their head.” This is one of the weaker excuses salespeople use. Salespeople that use this excuse would rather build relationships with a non-decision-maker than sell value.
“The buyer sent me a Request For Information (RFI). I must honor their request.” RFI might stand for Request For Information, but it really means Request For Imitation!
“I have to discount. The buyer expects it!” If the buyer expects a discount, it’s because you created that expectation. You can always create a new expectation.
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What gets in the way of selling value?
(Transcribed from podcast)
On today’s episode, we’re going to answer a question that came from a recent virtual training seminar. I was actually debriefing the webinar with a sales leader,and we had a conversation about selling value and he asked me a great question.
He said, “Paul, so what gets in the way of salespeople going out there and actually selling value?” That turned into a wonderful conversation. That’s what we’re going to focus on in today’s show is what gets in the way of selling on value.
Now, before we get into that, a quick shout-out to our sponsor, The Creative Impostor Studios. If you’re thinking of starting a podcast, if you have a story to tell, if you want to connect with your audience at a deeper level, podcasting is the way to go. And if you’re going to start one, Andrea is who you want to go with. There’s going to be a link to her website on this webpage. So check it out.
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Let’s get back to that question: What gets in the way of selling on value? I’m going to give you several reasons. These are in no particular order, by the way. I’m just going to address them one by one. This is what I’m hearing from salespeople. When we’re conducting training seminars—when I’m working with them, coaching them one on one—here’s where salespeople struggle to sell value. One of the common things I hear is, “I try to sell value, but that customer/that buyer that I’m working with only buys on price. They’re a pure price shopper.”
Let’s think about that. If that’s a common excuse, if that’s something that you’re telling yourself, ask yourself this question instead, “Why am I even selling to this type of customer?” Or, “Are they really a price shopper?” Here’s what our research shows. Only about one out of six customers are what we call true price shoppers, meaning, they only focus on price. Price is the only thing that matters. You’ve got to ask yourself a question, “Do I really want to spend my time and energy and effort on trying to sell value to a buyer that is purely focused on price?”
Now, oftentimes, buyers will masquerade as a price shopper. They’re going to put more focus on price because they know if they give you a little pressure, you’re likely to discount. But keep in mind that a true price shopper is only about one out of every six. And we don’t want to spend our time and energy and effort going after those types of opportunities.
One of the other common challenges I hear from salespeople when they struggle to sell value, they’ll tell me, “I’m trying to sell value, but I keep getting stuck with procurement. I’m stuck in the procurement trap.” This is common. In fact, our research that we conducted (I think it’s like three years old now), we found that 34 percent of salespeople spend a majority of their time selling to procurement or professional buyers. Of all the options that salespeople were given in this survey, that was the most common type of decision maker that we’re calling on. Think about this for a moment. You have a procurement-type buyer. Their job is to try to whittle every little bit of margin that they can out of the deal to get a discount. That’s how they prove their value to the organization. So you have salespeople that are spending most of their time trying to sell value to the one type of decision maker that is the least likely to buy on value. So, if you’re telling yourself, “I can’t sell value because I’m stuck in procurement,” my question would be, why are you even talking to procurement? Too many times salespeople will start in procurement. They assume— Because the title indicates that they’re likely to buy, it doesn’t indicate that they’re likely to buy on value.
So instead, focus on other departments. Take a different angle of attack. Work with engineers, work with technical influencers, work with higher-level decision makers. Just don’t have your point of entry be through procurement. I’d take a different avenue into that opportunity.
Moving on. Another reason salespeople struggle to sell value is they can’t get in front of the ultimate decision maker. I hear that quite a bit. They just say, “They won’t meet with salespeople,” or, “I don’t want to offend my lower-level contact by reaching out to the high-level decision maker.” Well, I think that’s ridiculous. As the salesperson, you know that getting in front of that high-level decision maker, the ultimate decision maker, is critical to your success. Yet, so many salespeople are concerned about offending a lower-level contact. They’re concerned about going over their head. They’re under the false premise that “high-level decision makers don’t meet or don’t care about the type of solution that I’m providing.”
All of those are excuses, and especially the one about offending lower-level contacts. It’s as if a salesperson would rather maintain the relationship they have with their mid-level buyer versus taking a shot at the high-level decision maker where they’re ultimately going to win the business. Think about how backward that is. Our goal as a salesperson is to make the deal happen. And if we know that getting in front of the ultimate decision maker is the way to make that happen, that’s where we’ve got to go.
Now, if you’re concerned about offending a lower-level contact or mid-level contact, you can use a technique that will help save the relationship, but also help you get that meeting with the high-level decision maker. We call this the high-level schmooze—a very technical term, right? So with a high-level schmooze, it’s simple. You bring your company’s high-level people to meet with the prospects high-level people. This high-level schmooze is critical because it bypasses the mid-level contact while saving the relationship. Because it would only make sense that your high-level decision maker within your organization would want to meet with the high-level decision maker at your prospect’s organization. That’s the way they bypass that. Again, don’t use that as an excuse. Don’t use the excuse that you don’t want to offend your lower-level contacts.
Another common reason salespeople struggle to sell value is that they tell me the quoting process doesn’t really lend itself to adding value. And usually what happens, salespeople are stuck with RFQs (requests for quotes) or requests for information where they’re taking a boilerplate document that a prospect submits to them and says, “Fill this out.” You know, requests for information, all that stuff. And, it’s funny. When I hear that acronym, RFI, I really believe it stands for Request for Imitation, because that’s what happens. They, they send this boilerplate document out to several different organizations and say, “Fill this out. Give us the information. And, by the way, try to make it look just like everyone else.” And buyers love doing this because, once everything looks the same, they can focus the conversation towards price.
I would take a different approach. When you have an RFQ or an RFI, whatever it is that comes in through your office, you want to acknowledge it, but don’t assume that you need to follow their process to a T. Because the problem with following the buyer’s process is that it asserts that their process is the best process to go through. If you have a better way, if you can help them make a better decision, then you need to come back and explain that. You need to organize a needs or a discovery conversation with that prospect before you complete that RFQ. Also, use that RFQ or that RFI as a trigger event to get in early on the next big project. By the time they’re sending out information to you, it’s already too late. They already probably have a preferred vendor or supplier. They’re just putting you through the process. Instead, use this event as a trigger event to say, “I’d love to get involved earlier on in the process next time.” That’s the thought on RFQs/RFIs.
Another barrier to selling on value is the salesperson’s attitude. Here’s a common excuse that I hear from salespeople: “It’s hard to sell value when we’re selling the same exact product as our competition.” I do a lot of work in distribution. I do a lot of work in industries where the product is heavily commoditized or it’s identical or very similar to competitive products. If you’ve listened to previous podcasts, you know that the product is only one way that we bring value. The company you work for also brings value. And then you, as the salesperson, you bring value—your personal expertise. I would argue that the same widget sold from a different company from a different salesperson is really a different solution altogether. Because, along with buying that widget or whatever product it is, they’re also buying into your expertise. They’re buying into your ability to solve problems. They’re buying into your follow up, into your honesty, into your integrity. They’re buying into all the personal value that you bring. Yet, too many sales people forget about that, or they don’t think it matters.
Our customers, in our surveys, have told us that stuff really does matter. In fact, knowledgeable expertise continues to be that one attribute they care most about in a salesperson. So, the next time you tell yourself, “How can I sell value? Our product is exactly the same,” ask yourself these questions: “Am I the same as the competing salesperson?” “Who am I competing against for this business?” “Am I more knowledgeable than them?” “Can I solve problems that they’ve never even thought of before?” You’re competing directly with that other salesperson. Use that as a point of differentiation.
Another common barrier to selling on value is dealing with salespeople who have set the wrong expectation. I will hear from salespeople, “I have to discount because the buyer expects a discount.” Here’s the deal. If the buyer expects a discount, it’s because you have set that expectation, or it’s because the previous salesperson has set that expectation. If you’ve set that previous expectation, it also means you can set a new expectation. Yeah. It might seem a little risky. Yeah. It might be uncomfortable at first, but the next time the buyer requests a discount, you have to hold the line. You have to give them a fair price, a price that is comparable for the value that they’re receiving, and then when they ask for a discount, you have to shift that conversation back to value. You have to be able to defend your price. And every time you do that, it becomes a little easier the next time. And, you’re setting a brand new expectation.
Let’s get into one of the final reasons salespeople struggle to sell value. And, this last one is near and dear to my heart because I have actually sold in this type of environment. Salespeople will tell me, “It’s hard to sell value because I work on a bid-and-spec type of sale,” or, “I work in a tender process on a sale.” What they’re basically saying is, “I have to put together a bid and I submit that to my customer and they decide, are they going to go with me or are they going to go with two or three of my competitors.” They’ll tell me “How do you add value in that type of selling scenario?”
When you think of about that, yes, it’s a challenging environment where you have to put on paper, you have to detail a bid. And then, you’re leaving it up to the customer for them to decide, for them to determine who they go with. And oftentimes, sellers will tell me they go with the low bidder. Well, here’s my thought. You got to get there earlier on in the buying process. I talked about this earlier on the show, getting there early in the process is key. The next thing you have to do is you have to help influence the buyer’s specification or their criteria from the very beginning. And, you want to influence that criteria so that it favors your solution. By the time they do a comparison, by the time they’re looking at all the different options, your goal is to establish your criteria as the criteria they use to grade or benchmark everyone else.
Now, even in that low-bid environment, you still can sell value. It just requires influencing the buyer early on in the process before the bid goes out. It also forces you to sell higher within the organization. You need to sell a partnership at a higher level within the organization versus just focusing on a tactical product or service sale to the lower-level decision makers. If you can gain ultimate buy-in at higher levels within the organization, it’s going to make the bidding process easier in the future. It’s going to give you an advantage on whoever you’re competing with.
Make it a big day.