The 7 mistakes to avoid when selling on value

The 7 mistakes to avoid when selling on value

What is value

There are many definitions of what value, and value selling, is.

Take HubSpot’s, for example. According to them, the aim is "to provide value to the customer so the sales decision is made based on the potential value the product can provide."

Or sales legend Brian Tracy’s: "With this approach, the sales conversation focuses on how the buyer’s life will be improved with the asset at hand."

The problem with these definitions is that they are based on assumptions that value is based purely on the benefit the product will bring to the customer.

They fail to realize the most important thing: value is defined by your customer, not you.

So, what_is_ value, then?

Value is a mystery.

Value triad

The value triad is a concept that identifies the three key component areas of value

  1. The first component is revenue or performance gains. In other words, how does your product or service help your customers improve their revenue or performance? It’s important to keep the performance aspect as revenue might not be the issue for all your customers. For example, a hospital might focus on patient outcomes.
  2. The second element is cost reduction. How does your product or service help your customer to reduce their cost?
  3. The third component is emotional contribution. This element focuses on relationships, and your credibility or reputation in the eyes of your customers that will enable you to build trust (or not).

These three components interconnect to create the value triad. In a sales situation, you want to understand the elements of value that are important to the prospect, and flex your value model to put the right level of ingredients from revenue gain, cost reduction, and emotional contribution.

So, to recap so far.

Value is a mystery. And as a detective, you need three things in your toolkit:

The 7 mistakes of value selling

There are many mistakes

  1. Discount Default
    Procurement will always tell suppliers they are too expensive because they have learned from experience that a supplier’s first reaction to such a statement is to drop the price.

  2. Believing product is a commodity
    Customers don’t simply buy your product, they buy the entire purchasing experience.

  3. Focusing on presenting your product first rather than understanding the customer first
    Too many sales calls begin with the seller launching straight into a presentation about their products without actually understanding what the customer wants.

  4. Failing to solve the value mystery
    In order to solve it, it is important to realize that your customers define value, not you.

  5. Thinking that it’s all about the sales team
    Value based selling is a team effort.

  6. Failing to communicate and capture your value
    Customers do not buy what your products are, but the solution they fix.

  7. Not having an agreed sales process
    Customers will always have objections. Having a sales process can help increase revenue by up to 28%.