By Mark Boundy
Are You Winning Enough Opportunities at the Right Prices?Are You Winning Enough Opportunities at the Right Prices? https://c-suitenetwork.com/advisors/wp-content/themes/csadvisore/images/empty/thumbnail.jpg 150 150 Mark Boundy https://secure.gravatar.com/avatar/fda1708afcd4681826f4fb12f56401d9?s=96&d=mm&r=g
While many of my Sales Consultants specialize in specific industries, I have defined my niche differently: companies who produce a differentiated product or service, and who want to be fairly compensated for their value. This means selling at a higher price, In alignment withthe customer.
I’ve had the opportunity to work in many industries: electronic components, telecom gear, telecom services, commercial real estate, and banking. I’ve also been the highest priced option in all of those industries: a combination of products and services.
I have always worked for some of the most famously “high-priced” providers in whatever business I was in. The common thread, and the reason I’ve been successful in each role? In a stroke of early-career luck, I learned the fundamentals of selling to full value (much more involved than “value selling”, and much more effective at establishing higher preference at a higher price) at an early stage, and was able to refine that methodology for use in increasingly “commoditized” industries (what can be more commodity than selling money?). Those experiences formed the core of my Full Value Selling™ methodology.
How do successful selling and selling at the right price interact? Let’s take a look at some research.
Differentiation Gets Valued.
Look down the left hand side of the graphic below, produced by CSO Insights. Noel Capon describes similar levels of relationship shown in his benchmark work, Key Account Management and Planning. The higher up a customer places a supplier on the vertical axis of this scale, the more value they find in the buy-sell relationship.
CSO Insights has found that higher levels on the vertical axis correspond to higher win rates, which is awesome. Curiously, they have not even thought to study pricing power. That is apparently my lonely corner of the selling performance market.
Value CAN Get Compensated.
Many sales methodologies can be used to help selling organizations progress up the scale – at least as far as your customer wants you to go. Far fewer methodologies teach how to get a customer to want you higher on the scale. The higher a supplier is able to achieve relationship-wise on this scale, the more leverage the supplier has to price. Again, having leverage doesn’t automatically guarantee successfully using that leverage.
The difference between “winning more reliably” and “winning more reliably at the optimum price” is where I specialize. Full-Value Selling™ helps sellers consistently and smoothly help customers quantify the value received, and more acutely see the bargain they are obtaining – even at a higher price than competitors offer.
When customers are more rigorous at analyzing your value, they see price more clearly in relation to that value. Consumer behavior research shows that people only analyze value until they “get over the hump” to justify a purchase. What this means is that they won’t fully appreciate your entire value on their own; to appreciate your full value to them, customers need to be taken beyond that “make the sale” minimum. Sellers who want to reliably win premium-priced deals can do a little more: help the customer think through FULL value. This makes the seller not only able to win at more advantageous prices but resist discounting more effectively.
Relationship vs. Process Rigor vs. Sales Performance.
CSO Insights has extensively studied companies on not only the level of customer relationship achieved but on how rigorous their salespeople follow a selling process. The horizontal axis on the matrix represents four major categories of selling methodology/process rigor. “Random” means that every rep uses their own personal process. In “informal”, sellers go through process training, but none is enforced. “Formal” is the designation for ongoing process reinforcement and enforcement. “Dynamic” process processes are systematically revisited and updated in response to internal and external changes.
How does selling rigor interact with relationship quality? I’ll discuss results in a moment, but think about how much easier it might be to consistently achieve better customer relationships if sellers know how to perform best practices? The key to progressing to the right on the matrix is how well organizational support manifests itself in effective front-line sales manager (FSM) coaching and mentorship. Teaching a methodology gets you only so far; following it long-term, and making it part of your corporate culture is a huge differentiator.
What are the performance outcomes associated with your position on this matrix? Take a look at the color-coded outcomes corresponding to the matrix above:
Notice that these outcomes, while highly compelling, are deafeningly silent on pricing achieved. Any sales consultant, myself included, want to help you move up and to the right. I want to help you do more…by filling the void in that deafening silence.
Selling Well vs. Selling Well Consistently vs. Selling Well, Consistently, and Profitably
I also do work throughout our company’s clientele on improving how sales managers coach sellers. This is key to helping my clients achieve consistently great sales results, but also consistently optimum pricing. I can’t help my clients consistently achieve more profitable pricing for the long term without their commitment to long-term adoption.
Selling value consistently yields higher sales performance, but pricing those reliable sales results yields higher profit performance…think of it as a third dimension of sales performance. I help clients add a third axis to this matrix: doing it all profitably, by achieving optimum win-win pricing. This doesn’t replace any methodology; it complements those tools seamlessly with another: a relentless focus on value delivered.
If you want to move upward and to the right on the Sales Relationship Process matrix, we might need to talk. If you want to do that while achieving higher pricing that your customers love, we are kindred spirits, and I invite a deeper discussion of your goals.
To your success!