Baseline Selling Tip – Selling Value
I receive a great number of emails on the subjects of beating the competition, increased competition, difficult competition, writing winning proposals, making winning presentations and selling value. In the end, if you can effectively sell value, chances are that you can handle the other challenges that come your way. The problem is that most salespeople don’t even understand the concept of selling value, never mind being able to execute it. This week’s tip explores some of the principals of selling value.
1) The difference between price and cost of ownership. If you sell a piece of equipment that costs $75,000 and your competition sells their piece of equipment for $50,000 there’s not much chance that yours can be mistaken for the lowest price. However, you can demonstrate that yours is the lowest cost of ownership. If your equipment does not require replacement for twenty years and your competition’s must be replaced in 10 years, then you would have the lower cost of ownership of $3,750 per year. By comparison, your competition’s cost of ownership would be $5,000 per year.
2) Prove it. To actually use the above example you must have some facts, figures, tests, white papers, or something similarly credible, written by a third party. If you don’t, it’s just your word against theirs. How to you get your hands on a third party study? Pay a consulting firm to write one!
3) Ask the right questions. Prospects that announce they will buy only on price tend to be quite aggressive, sometimes hostile in their styles. You’ll need to pretend that you understand (you can’t REALLY understand) and ask this question: “Suppose that by going with the lowest cost of ownership you could save even more money than by going with the lowest price – what would you do?” If they’re open to that strategy, now you’ll have the tools and strategy to follow through. If they aren’t open, please ask, “why?”
4) Return on Investment (ROI). Some prospects will want to see their ROI before purchasing something new. Fortunately, there are some great tools for calculating ROI. One such set of tools is available at http://www.roi-calc.com.
5) The value of compelling reasons – when a prospect’s reason for doing business is compelling enough, like it’s costing them too much, no one else seems to be able to help, etc., you can always ask this question: “and are you willing to invest a little more with me to get this problem solved, the right way, once and for all?”
Baseline Selling explains all of these strategies in detail and many more. Refer to the chapters on Getting to 3rd Base and Running Home.