Value-Based Sales & Pricing
What is VBS?
In the simplest terms it is identifying value drivers (customer pain) and crafting a proposal linking those drivers to your organization’s core strengths (what you are selling).
Before you can start the investigative process, you need to understand what you are selling. Here is what you are not selling; the product(s) and/or service(s) in your catalog or on your website. If the item has a SKU to enter, it is not what you are selling. While some sales are based on feature/benefit, it is too small a percentage to really move the needle. Each competitive product or service is going to have pro’s and con’s which even out in any statistically relevant sample size. The answer is:
Why is a customer giving you money instead of a similar competitive good or service? As this is an extremely complex and business specific question, it really cannot be addressed here. Contact us to arrange your no-cost discovery session to learn more.
Now that you understand what you are selling, it’s time to focus on your prospect’s issues. Asking questions is the easy part, where most salespeople fail is in listening. Active listening is second only to knowing what you are selling in importance to your success.Here are some Do’s and Don’ts in active listening:
- Take notes
- Listen deeply enough to consider what’s behind the pain
- Be genuinely interested in understanding and solving your prospect’s issues
- Start formulating a response while your prospect is speaking
- Think about potential solutions
- Think about anything other than what your prospect is telling you
- Think you have a solution after one round of questions
You now have the steps to the process; however, one key ingredient is missing– TRUST. Trust is what makes Value-Based Sales so challenging, and why so few people/organizations use or are successful with it. The continuous questioning process serves two purposes, information gathering and trust building. By showing a prospect your true interest in solving their problem(s) and not just selling them something, they will begin to trust you as a partner.
You now have all the required ingredients for a compelling value proposition. By putting that value into monetary terms, you’ve created a solution that is easy to visualize and therefore act upon. Done correctly you will:
- See increased margins as pricing becomes a detail at the end, not a core discussion
- See improved close rates as you are solving specific problem(s)
- See significant gains in productivity, especially if combined with a well-defined target market and qualification process
All of that translates to improved top line (revenue, margin) and bottom line (increased efficiency in the sales force).
Fill in the form below to learn more about our approach to Value-Based Sales, how it can benefit your business and download a sample presentation.