Sell the “Product of Your Product” to Differentiate Yourself From a Commodity

by Marcia Gauger

Question:

I hear talk about stressing value to differentiate products and services, but how does that apply to commodities? From the customer’s perspective, the products we sell are absolutely no different than anyone else who distributes this product. All we have to compete on is price.

Answer:

Don’t get hung up on the product itself. You need to think about what you do for the customer. For instance, when we purchased a new copy machine for the office, we could have purchased the exact same brand and model for less than what we paid from a number of distribution sources. However, the company that we chose added value by offering advice that we needed regarding networking the machine to our computers and other online materail distribution issues that we were facing. Even though we paid thousands of dollars for the machine, the company we employed is in the business of selling service, not machines.

Make a list of everything you do that adds value for your customers – This is the first step in differentiating yourself. If you can’t list anything, you might want to consider another line of work! Consider the value that you bring to your accounts from a customer’s perspective. For instance:

• Do you offer better delivery schedules than the competition?
• Can you reduce the amount of product waste the customer is experiencing by offering suggestions on usage?
• Do you offer training that would increase plant safety as it relates to your product or service?
• Can you offer special packaging that would reduce handling of the product?
• By utilizing a method that you suggest, will the customer increase production or some other quantifiable benefit?
• Can you eliminate their need for other suppliers by serving more of the customer’s needs?

Sell the product of your product – For instance, if you were seeking the assistance of a lawyer to compose a will and trust for you, you would be buying the product of a product. A will is a fairly standard document – a commodity. However, you are not buying the product itself, or you would do it yourself on the Internet. You are buying the service and advice that you receive from an expert. Stress what the product does for the customer, not what the product is. The better advice you give, the more value you will add in the customer’s eyes.

Next, quantify the value for your customer – For example, if you can indeed show better response times than the customer is accustomed to, quantify what this means to the customer. Use the customer’s figures. If you are able to provide just in time delivery, how much does that mean for that particular customer in terms of saved inventory costs?

Define value for each individual customer – The problem with the word “value” is that it means different things to each customer. Stressing what you think may be important to one may not be to another. Some customers are strictly price shoppers and won’t give you the time of day. Others value expertise and welcome your advice. Somewhere between these two groups are customers that don’t know what else to ask about except price. And, given the opportunity, will share their aches and pains. Find out what’s important to each and stress value accordingly. For instance, the last time we bought computers for the office, one of my business partners tried to convince me to invest in the largest monitors available. While this particular feature just seemed like added cost to me, it was a significant value for my partner who was having trouble seeing the screen. Value is almost always measured in terms of increased time, decreased time, increased profits or some other personal pain or goal.

Don’t dwell on the competition – It is valuable to know how the customer feels about the competition. But, your focus should be on what you can do for the customer, not how you can outdo the competition.

Reduced price is not value – Anyone can cut his or her price. If you are relying on price cuts to gain business, be prepared for high turnover in your accounts. A request for quote is the customer’s way of saying, “I see no difference in what you offer from anyone else”. This is the starting point for you to discover opportunities to help the customer and provide value. You may simply say, “I would be delighted to provide a quote. Let’s get together so I can provide an accurate quote by better understanding your needs.”

Marcia Gauger is Partner at DVR Learning, LLC, specializes in the design and delivery of performance-based learning programs and materials for sales professionals. Her blog is: http://www.dvrlearning.com/blog You can contact Marcia at email or call 262-642-9610. www.dvrlearning.com

Is Consultative Selling Relevant?

by Marcia Gauger

Question: Over the years, I have adopted what I consider to be a consultative approach to selling. Lately, I’ve left meetings feeling a little “unfinished.” I spend so much time asking questions that I feel there is inadequate time for presenting solutions. Is it time to adopt a new model of selling?

Answer: If you’re asking if consultative selling is obsolete, the answer is no. Some experts feel that transactional selling has prevailed over the last couple of years, however all agree that consultative selling is more important now than ever. We agree. Perhaps the definition of consultative selling needs to be visited. Some salespeople define consultative selling by what it’s not; not using a standard approach, not overdoing features and benefits, not talking too much, etc. While these are all probable pieces of a consultative sales model, they are not the complete picture. It sounds like you have fallen into a trap that many salespeople have.

Over the years, consultative selling has been promoted as the way to sell, and I agree. However, the key word is "sell." There are those that believe that consultative selling means that you only ask questions and solutions will develop on their own. While asking questions is a key to uncovering needs, if that’s all you do on your sales calls you will disappoint yourself and your customer.

If a customer takes time out of their presumably busy schedule to meet with you, they must be interested in what you can offer them. They just don’t want to know everything about what you offer! Asking questions alone without making recommendations causes the customer to feel empty, like they wasted their time.

Consultative selling is somewhat of a well-timed dance. Dancers that are in-tune to each other seem to glide, anticipating every turn and movement. Ideally, customer interactions should feel the same way. In a recent class on consultative selling, I asked the group to define what consultative selling was. I like the definition they came up with, “Consultative selling is to identify needs and suggest solutions that help a customer solve problems or more adequately reach their goals.” This is more of a collaboration between salesperson and customer rather than the more self-serving sales models.

If you’re feeling “unfinished," it may be that you are spending too much time asking empty questions. You should never feel like you are firing off questions. The questions you ask should be the result of pre-call analysis that reveals what you know and what you need to find out. Questions should be strategically woven into the conversation to produce the desired result. The most fulfilling consultative sales situation is when you help the customer uncover a better means of accomplishing their goals. Asking the right questions is key to getting to that point. However, questions are like the tools of a mechanic. You don’t pull out a wrench when you need a hammer. Each question you ask should be purposeful. For instance:

Help customers reveal needs by asking questions about their goals – These should not be general questions, but questions that relate to how you might help them. For instance, if you were selling office machinery, you might ask them how productive their office staff is. Listen for gaps that you can fill. Ask open-ended questions to provoke thought and uncover needs. You should think these through in advance of your sales calls. Start by asking what you know about the customer and what you need to know.

Ask questions that reveal value for the customer – “What would a 10% increase in productivity mean to your bottom line?”

Check the pulse of the customer by asking involvement questions – These tell you how close a customer is to a commitment. As customers reach a decision, they begin to think about how your suggestion will fit into their situation. So, you ask specific questions about how they will use your product of service in advance of the sale. How they answer tells you where they are mentally. For example, “If you decide to go ahead with this, what plant will you want to have trained first?” If the customer’s response, “I haven’t thought about it," you have a bit more selling to do. If the customer’s response is, “I was hoping to start with the Waukesha plant,” close the sale!

Ask questions to position a solution – “Keeping up with technology is difficult these days, isn’t it?” If the customer agrees that this is a challenge for them, you would present the applicable solution to solve their issue.

Here are some additional tips to ensure that you have adequate time to position solutions during your sales calls:

Position a single solution after each discovery instead of waiting until the end – Doing so will enable you to keep the customer involved in the conversation and build interest throughout the sales call. The customer will see the “What’s In It For Me?” throughout your interaction.

Set expectations up front – Position why you are there and what you expect to accomplish. This will ensure that you and the customer are on the same page right from the start. You could simply state something like, “Here’s what I’d like to do today. I’d like to review your need for just-in-time inventory and your current practices to see if we can help you meet your requirements. Is that what you expect?”

Schedule a follow-up meeting to present solutions – Don’t assume that you have to accomplish the entire sales process in one meeting.

Only provide solutions that are of value to that specific customer – You may indeed offer many valuable features and benefits. The only ones that matter are those that apply specifically to that customer’s concerns.

Don’t think of consultative selling as a single event – Take regular tours of your customer’s production areas to help you understand their challenges.

Marcia Gauger is Partner at DVR Learning, LLC, specializes in the design and delivery of performance-based learning programs and materials for sales professionals. Her blog is: http://www.dvrlearning.com/blog You can contact Marcia at email or call 262-642-9610. www.dvrlearning.com