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Understanding Your Customer’s Needs And Requirements

by David Brock on July 5th, 2017

In my formative years in selling, one of the key things I learned was to understand my customer’s needs and requirements as early as possible.

In virtually every sales methodology and process, there is some “discovery stage.”  Typically, in that stage, our goal is to understand the customer’s needs, goals, requirements.  We do this to understand how to present our solution, demonstrating we meet their needs and so forth.

There’s a huge challenge with this–consequently a huge opportunity.

By the time a customer is able to articulate their needs, priorities, and requirements, they are pretty advanced in their buying cycle.  They’ve clearly spent time defining the problem they want to solve.  They have probably done some research of alternatives available, and are narrowing down the solutions they are willing to consider.

If we are first engaging them at a time when they can answer the question, “What are your needs, priorities, and requirements,” we have lost a huge opportunity to create value with the customer by helping them discover these.

The toughest part of the buyer’s journey is figuring out the problem they are seeking to solve, establishing goals for solving that problem, aligning the diverse priorities and agendas of the buying group, understanding their needs, priorities and requirements, considering alternative approaches to solving the problem, then determining their needs, requirements, and priorities once they’ve settled on an approach.

If we engage them when they have finally figured that out, we are only addressing the simplest part of their buying journey.  As a result, our value in helping them learn and determine what they might do has been eliminated.

We transform our relationship with our customers when, through working with them, we help them learn, discover, and grow.  When we help them think of things in a different way, consider alternatives and new options.  When we learn about who they are, what their fears and aspirations are, what their goals are.  When we learn with them, identifying problems and opportunities, helping understand risks, alternatives, gaining alignment within the organization, figuring out what they want to achieve.  We create greater value with them by helping them determine their needs and requirements–rather than waiting for them to figure it out for themselves.

If we’ve engage our customers at the right time, we never have to ask the question, “What are your needs, priorities, and requirements?”  We already understand these because we’ve been involved with the customer in shaping them.

As a sales person, if this is where we start, we are already behind, we are already disadvantaged, we are limited in the value we can create with the customer.

 

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2 Comments
  1. Dave,

    Couldn’t agree more!

    You said:

    “If we’ve engage our customers at the right time, we never have to ask the question, “What are your needs, priorities, and requirements?”

    I would add, “at the right time and in the right way”.

    Geoffrey Moore called it “the provocative sale”, Challenger is in vogue, some call it hypothesis selling. Whatever, as you point out every methodology has something like this and when executed properly it is the fastest path to discovery as a valued partner versus being in a mode I call “catch a train speeding down the tracks”. The train being the advanced buying cycle you refer to.

    Thanks for the great insights.

  2. Martin Schmalenbach permalink

    Good stuff, as usual Dave!

    The question of price discounts is relevant here.

    In my world (semiconductors), clients are always expecting a discount. The trend has been year on year price reductions on average of around 8%. That’s BEFORE they ask for discounts… which they also do…

    My challenge to many sales people who are stuck in the price discounting thought process is this: how are you going to pay for the discounts? Every penny you give in discount is a penny less for investing elsewhere in your business, including your salary raises, new head count, new equipment, new product development etc.

    It’s also an investment in the relationship. So when asked for a discount, I ask the client where is the best place to invest say, $10K? Is it in the form of price reductions, where the value to the client of my investment is also $10K? Or is it in the form of engineering support that enables him to get to market 2 months earlier and benefit from an extra $35K in profits as a result?

    The answer you get depends on who you talk to, which is why you need to engage as high up the food chain as you can…

    Challenging the client to revisit with you their thinking and decision process to date is where you will find the greater value to co-create. If they refuse to do this, you can tell the client that’s fine, but it severely limits the value that can be created together, and therefore the share of the value you get. Which means there is much less available to fund/cover a sufficient return on the value creation activities.

    Purchasing folks want the price reduction – it’s what they are incentivised on. It’s also about the least amount of value you can create for a client. It’s not wrong, it’s just not best serving your clients… or yourself.

    Also, another question for the client… if I’m investing $10K in our relationship Mr Client, what are YOU going to invest in this relationship? I’m not looking for a strict quid pro quo, but this certainly isn’t going to be a one-sided relationship (which is actually what aggressive supply chain management is really about – move all risk from client to supplier, and move all profit from supplier to client…)

    For us, in my world, an investment we would value might be deeper, broader backlog on orders, or guaranteed access to all new design projects at their inception. It doesn’t have to be something that requires the client to actually stump up something costing them $10K of investment.

    Value is about more than price and cost!

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