Your job as a sales professional is to sell, but that is not your only mission. Value-based selling is a process of taking a consultative approach to sales and conveying the value of a product or service along the way.
This article will explore the concept of value-based selling, including its principles and a framework for how it can be implemented. We’ll also look at some examples of how value-based selling might be used in practice.
Value-based selling is a sales approach that focuses on providing benefits and value to the customer throughout the sales process. The goal of sales representatives is to advise potential customers on how a product could be of use to them, in the hope that this will lead to a sale.
The goal of a value-based selling approach is to find out what the customer needs and guiding them to make the best decision for them. This makes the customer excited for the positive outcome your product will give.
Most prospects are constantly being bombarded with messages convincing them to make a purchase. If you want to be successful, you need to provide more value than anyone else. This will help you stand out from the competition and create long-term happy customers.
Why Use Value-Based Selling?
There are several reasons for using a value-based selling model, and they are the following:
It considers the needs of customers
You take into consideration the needs and wants of customers and use them to influence customers’ decisions. As a sales representative, you need to convince potential customers that your product or service meets their needs perfectly and is worth the cost.
It engages customers and fetches you higher profits
Value-based selling helps engage prospects and shift their focus from the product’s price or service to the benefits they would get. This technique is used to get potential customers interested in what you have to offer by focusing on how it can add value to their lives. The tactic can be useful for sales representatives to use in order to make a good impression on potential customers. After hearing about the problem and your solution, they would be eager to start using it. This will help you to close deals faster and at higher prices and ultimately get more profits for your company. The time you save can be used to contact other potential customers. Read our detailed guide on sales engagement tips.
Build a healthy connection between buyer and seller
You can build a relationship with a potential customer by addressing their requirements and showing them how your solution can help them. When buyers are given a product at a cheap rate but don’t know its value, they will often switch to another vendor who gives a lower quote. If a value-based sales approach were used, this wouldn’t happen. If you can convince your customers of the value of your product or service, they will be less likely to leave you solely because of price.
Principles of Value-Based Selling
Forming relationships with potential customers is important in order to gain their business. Showing concern and helping them understand your solution’s value will strengthen the relationship between you and the prospect. When buyers get a product at a cheap rate but don’t know about its value, they may be more likely to switch to another vendor who gives a lower quote. A value-based sales approach would prevent this from happening. If you explain the value of you product or service to customers, they will be more likely to stay with you, even if you are more expensive than other options.
Do your homework.
The goal of value-based selling is to close the sale by putting the needs of your prospect first. If you want to put your prospect’s needs first, you need to know what those needs are. Before you have a sales call with someone, you should always take the time to do your homework and learn about them.
When researching a prospect, you should try to learn as much as you can about their company and industry, as well as their background and what challenges they are facing currently. You will be able to serve them well if you understand this information.
Here is some information you may want to consider looking for as you prepare for your call:
- Their current role and previous job experience — A simple LinkedIn search can help you learn about your prospect’s career history. Are they new to their current role? If so, they might still be ramping up and could benefit from learning from you. Is this their first time making this type of purchasing decision or have they been in similar roles? If they have experience in this area, they may be more interested in expediting the process, so you can better serve them with efficiency.
- Common connections — If you have a common connection with a prospect, that can help you build trust with them faster. Additionally, the contact could help provide key insights into the prospect’s pain points and how you could provide value to them.
- Content shared on social media — If your prospect has a public Twitter or Facebook profile, checking out what content they have recently shared or engaged with can give you an idea as to what is currently important to them.
- Their company’s website, press, and social media pages — This will tell you whether their company has undergone any recent leadership changes is currently releasing a new product, or has been in the news.
- Their contact listing in your CRM — Before hopping on the phone with your prospect, check out their profile in your CRM. This will tell you if and when any of your colleagues have engaged with them, and what content from your company they have opened or engaged with.
A quick Google search of their company’s competitors will give you a lot of information about their industry landscape.
Don’t jump into your sales pitch too early.
Don’t give into the temptation of immediately launching into your sales pitch as soon as you get your prospect on the phone. There is no substitute for hearing directly from your prospect when trying to understand their perspective.
Make sure to listen to your potential customers before trying to sell them something. Hear them out so you know what they need, and then give them a pitch that meets those needs. Putting off your pitch can help build trust with potential customers and give you a better idea of how to provide value that meets their needs. This can result in a more successful sale.
Communicate how your product provides value to the customer.
Your prospect needs to have a problem that they are trying to solve in order to be interested in a new product. You have to be able to explain why your product is the solution to the customer’s problem.
Before you sell your product, make sure that the benefits of your product are easy to understand and relevant to your customer. For example:
- Is your product designed to reduce cycle time and improve productivity for those who use it?
- Does your company offer free training that will help customers quickly get up to speed after they have made their purchase?
- Does the purchase of your product include free automatic updates for customers to make their jobs easier?
Your product or service should have unique qualities that match the customer’s needs. Use these qualities to guide your sales conversations.
Be genuine and trustworthy.
With value-based selling, there comes a responsibility. You act like an expert and, in a way, make prospects look up to you for advice on how they can improve their work process.
You only get one chance to win someone’s trust. There is a possibility that you will lose the client if you disappoint them. The more credibility you have, the more likely others are to trust you. To do that, you need to collect as much information as you can and learn more about your product or service.
At the same time, be genuine. If you don’t know the answer to something, be honest and tell them.
Telling the truth would help build trust and is much better than misleading the prospect.
Be an active listener.
Do not rush to present your sales pitch at the beginning of the conversation with the client. Instead of asking what they want, find out what their needs are and what problems they are facing. Make sure to listen attentively to learn about the current situation of your prospects so that you can work on improving it. I would recommend starting with some open-ended questions. What are the best questions to ask customers to get to know them better?
Tell how your product will fit into the needs of prospects
The prospect is interested in finding a new product or service to help them resolve a few issues or needs. Your product or service will resolve their issues because it is specifically designed to help with the problem they are experiencing.
Make sure that your points of differentiation from your rivals align with your customers’ needs.
Focus on teaching instead of selling.
One of the best ways to show your prospects and customers that you care is by helping them learn more about a topic they’re interested in. When you prioritize your education, your students see you as a reliable source of information and this helps to build trust.
If you have already built trust with the potential buyer and they are ready to make a purchase, your product is much more appealing. This is because you have already shown them that your product has value, instead of just trying to sell them something without any evidence.
You can begin by contacting prospects and asking them about their top three challenges instead of using a recycled sales pitch. Instead of presenting slides during your meeting, you can engage your audience by walking them through possible solutions to their challenges.
How Can You Add Value?
There are more than one way to add value to prospects, and it is your choice to decide which one to use. Here is a list of what to focus on.
Providing qualitative value
You don’t need to worry only about numbers to do value-based selling. Your product or service can improve the customer’s experience by addressing their pain points. Think about how you can remove obstacles from the path of your goals and what the result of that would be. You can demonstrate to potential clients how your product is easy to use or how it can help them to grow. Make sure to emphasize what potential customers can gain by using your product or service in your value proposition in order to make it more appealing to them.
Providing financial incentives
The worth of your proposal is somehow linked to the financial advantages it has to offer. Most companies want products or services that will help them be more successful economically. If you can convince potential customers that your product or service can improve their revenue, you’ll have a much stronger foundation for selling it to them.
Customer testimonials that demonstrate how much more money a prospect can make by using your product or service can help you close the deal. Your product or service should be able to help the client save or make money.
Providing something different from the rest
You will not be successful if you do what your competitors are doing. To be better than your competition, you need to show how you are different from them and how you can improve your client’s life. You will need to build a separate identity for your brand that will attract clients.
Providing help to averse risk
Every business has risks that can concern its owners. knowing your customer’s needs can help you sell them products they need If your solution can address the client’s concerns, they are likely to proceed with your proposal.
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