Do you know what ‘Value’ is? You probably have a definition of value, but that definition may not match your customer’s. The truth is that value is subjective, and individuals derive interpretations of value from a variety of factors.
In negotiations and competitive markets, the inability to match your definition of value with your customer’s allows competitors to gain a significant advantage. If you want to win the business, you need to equip your team with the skills to not only communicate the value you offer but change the perception of value your customer holds.
At Robin Lines Associates, we’ve been running programmes on Communicating and Selling Value for many years, and here are a few quick tips to help you and your people.
Recognise that Perceptions of Value are Fluid
Would you spend £2,000 on a laptop? If you answered ‘no’, then you’re probably not a video gamer or creative professional. If you answered ‘yes’, you might well be one of those things. Value is about more than money – it’s the answer to the question ‘How does this benefit me?’
Value is influenced by any number or combination of factors such as location, situation, timing, people, priorities, budgets and resources. You need to uncover what influences your customer’s perception of value.
Confirm Assumptions About the Customer’s Challenges
A crucial part of any sales process or negotiation is to understand the customer’s position. There is a tendency to focus on Generic Value – that is to assume that clients in the same market are seeking to overcome similar challenges. While this may be true, you should still attempt to confirm the assumption and then drill down into the specifics of those issues.
If your customer is seeking to address an unusual problem, then you have the opportunity to match the issue to a specific solution. Demonstrating that you both understand and can solve particular concerns is a significant step to the building of value.
Correct Your Customer’s False Assumptions
Many customers derive their view of value from personal opinions, which may not be based on current or accurate information. Sometimes they may be misled by competitor rhetoric or speculation from the internet. Such poor-quality research can negatively impact their willingness to pay your fees.
Asking questions to uncover concerns allows your salespeople to address and correct uninformed views. In the majority of cases, the customer will have preconceived notions of your offer before they have even heard you out. You should seek to make sure they are fully informed.
Differentiate Your Offer
Why should people buy from you and not a competitor? If your business has higher prices, what premium are you offering to warrant them?
Customers will expect you to justify your fees, often before the price is discussed. Whatever sets you apart from competitors must be highlighted, particularly when those differences match a customer’s perception of value.
Crucially, being different is not differentiation. A red car is not inherently different from a blue car; but mileage, emissions, manufacturer’s reputation, length of the warranty, etc. are factors that can influence a buyer into choosing a different car. You need to pinpoint and communicate what sets you apart from everybody else.