May 1, 2020
Delivering meaningful value
- Through skillful questioning technique you have uncovered the prospect's needs
- It's very easy to bombard your prospect with the many features that your products offer
- However, not every feature is of benefit to every customer
- Features and USPs are meaningless if they do not deliver value in the customer's eyes
Features, Functions and BENEFITS
- Feature - anything you can touch, feel, see or measure, answers the question "what is it?"
- Function what the feature does, answers the question "what will it do?"
- Benefit gain, save, advantage made from function, answers the question "what will it do for me?"
- Customers buy features, functions and benefits; sales people sell features and at best functions
- Ask yourself "so what?"
- Explain to the customer "And this means to you"
- "Let me show you anyway" means you are telling about features the customer may not have asked for
- With skilful questioning (see funnel technique) you can uncover and develop customer needs
- You can guide the customer in the direction of the products that you have on offer
- Ask questions to see if your features and functions are going to be of benefit to this customer
- If they are not - then why waste time and effort explaining them?
Explaining the Benefits"So, Mr. Customer, with the new support agreement you can call our help desk day or night (the feature). This will give you continuous support (the function) when you introduce your 24-hour shift pattern. This means that should you experience any difficulties, say at the weekend, you will not lose any production capacity (the benefit) as you will get help with any problems straight away".
Adding value up-selling and cross-selling
- Up-selling increasing revenue by selling similar products and services that have a higher price
- Cross-selling (link selling) increasing revenue by selling complementary, additional products
- Must be able to prove to the customer that there is "something in it for the customer" - added value
- Value is "...the worth of something compared to something else......"
- Value could be a high "pay back" for small outlay (also discussed in terms of ROI)
- "Pay back" is the tangible return delivered by the benefits of your products and services
- The greater the pay back the greater the value to your customer
- It is rare that a customer buys just "for the sake of it" they want a return for the outlay
The Value formula
- Value = benefit cost
- The more needs we can uncover, the more benefits we can deliver
- The more benefits the greater the pay back, the greater the pay back the higher the value
- The higher the value the better the chance to up-sell and cross-sell
Proving value, THE VALUE GAP
- Once the need is uncovered there has to be adequate pay back and value in fulfilling the need
- The customer has to understand the implications of not fulfilling the needs (or fixing the problem)
- You need to establish the difference between adopting your solution and not adopting it
- The difference between status quo and adoption is the "value gap"
- Find value gaps to which you can attach a monetary amount
- Then you can justify the benefit in terms of tangible "added value"
Value Gap simple example
- Manual sales order processing system
- Company could sell 20% more orders if they could process them
- Annual sales = £1,000,000
- New automated SOP would mean processing the orders
- Value gap = £200,000 per annum
- New SOP system = £50,000, cost of implementing, training, operating = further £50,000
- New SOP pays for itself in 6 months - if you can prove the system WILL process the additional 20%
- Customer will never understand the value gap if they do not see how the features and functions deliver the benefits
- The best product, at the best price does not always win the order
- Sell benefits, don't simply tell about features
- Look for the value gap and quantify it
- Make the intangible tangible = monetary value
- Do not leave the customers to work the value for themselves - they might not bother!