Value Selling

If you have not experienced a drop in sales recently, you might choose to skip this issue. On the other hand, if you miss it, you just might find yourself competing with those who learned this technique.

Two things happen in a down market that directly affect every sales professional.

1. Total spending is cut irrationally

2. Buying power moves up the organization

The cure for each of these problems is found in Value Selling. Simple features and benefits selling is designed to satisfy needs when the client is buying but it's tough to use them with a client who isn't.

Total spending is cut irrationally

In down markets, you will often hear clients complain about their company's 10% across-the-board budget cuts. They explain it to you as if it actually made sense and then use if as an excuse for not buying. It's safe to say that any company that cuts 10% out of every department has failed to take the time to analyze their spending needs properly. After all, if you were in a boat that was 10% over weight, would you toss 10% of everything overboard? If you did, the engine would stop running and the hull would begin to leak!

Your job is to help your clients examine their businesses in such a way that they realize that your offering will actually add money (Value) to their bottom line. Only when we do, will they feel justified in reallocating money to buy your product or service.

There is one major caveat to Value Selling: Your offering must, in some way, actually be able to help the client earn or save more than it costs.

Step 1: Develop your case

Imagine you are the CEO of your client's company. Even in a downturn, you would gladly give a trip to Aruba to any employee who could show you how to significantly increase sales or cut costs. Your job is to make a case that would earn that trip. Here's how to do it:

a. Understand the client's business - You must investigate your client's business as if you were going to buy it. You need to know their "critical numbers", those statistics that every manager watches every day. You need to know how your offering fits into their business and what affect it could have on the critical numbers.

b. Build a positive scenario - Once you fully understand the details, prepare a proposal that shows the positive affect of your offering and the return on investment that the company will experience by purchasing it.

c. Prove it - Assume that you'll be challenged on your assumptions and projections, so be prepared to defend them. Where possible, use number gathered from the client's executives.

Step 2. Present it

Here is where you address the fact that buying power moves up in a down market. The same person who authorized a $2M contract last year only has $200K in buying power this year. If you present your big deal to that person, they will be forced to either reject your plan or try to sell it internally themselves. You must identify the real buyer and make your case directly to them. I recommend that you start as high in the organization as you can. After all, if you are asking them to reallocate precious funds from one department to another, a department head will not have the power you need.

Step 3. Close it!

Big, complicated sales sold to high-level executive can get tied up in delays and shuffled from one person to another. Always remember that you are there to help the top dog win and you should never be afraid to let them know that this important project is stalled in middle management. Let the CEO be your Roto-Rooter and help you clear the clogs in their system.

Obviously, this was an abbreviated version of the Value Selling process, but many of you should be able to get started on it today. Pick one account and make it your goal to make a big value presentation by a given date. Please share your successes with me. I love to hear good news.

For a free copy of "20 Questions That Uncover Your Value", please email article17@waterhousegroup.com and ask for article #17.

Stephen Waterhouse is Principal and Founder of Waterhouse Group. They specialize in helping companies increase their sales and profits. He can be reached at 1-800-57-LEARN or steve@waterhousegroup.com.

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