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What If We Can’t Find Compelling Value For Our Solutions?

by David Brock on August 27th, 2009

I was reading Rebel Brown’s great post:  Accentuate The Positive.  It focuses on positive messages and approaches in sales and marketing.  She raised an interesting question, What if we can’t find a compelling value-based approach for our solutions? 

The question is scary, but fascinating. I think it impacts many of us, whether in a specific sales opportunity, or in marketing and product programs.  It’ something we’re afraid to confront with ourselves, our managers, our companies.  The current economy makes this issue all too visible.  A month ago, I was having a conversation with a senior sales executive with a very large company.  He made the statement, “We are struggling to be relevant to our customers again.”  He followed that with an explanation of the new programs and initiatives they were launching to become relevant again.  Many of the programs were outstanding, some struck me as just increasing the noise level and confusion.

No amount of activity, no fancy marketing program, no creative sales initiative will solve the problem if we cannot create compelling value in the solutions we provide our customers.  As is often the case, in solving the issue, in all our sophistication we often create more complex approaches that cost more and increase the market risk.  What if we turned to simpler solutions to this problem.

For me, everything starts with a customer.  As a sales person, if I can’t define a compelling value proposition for the customer, I need to look at things again.  Perhaps, I haven’t understood what the customer is trying to do.  Perhaps I haven’t probed deeply enough or spoken to the right people to understand the real issues?  Sometimes, we rush so quickly to the solution, that we haven’t understood the customer and are poorly prepared in presenting our solution in a way the demonstrates our compelling value and differentiation in solving the customer’s real problems.

Sometimes, after all that, we find we don’t have a compelling value proposition.  Hopefully, we discover those early and disqualify the opportunity, however, whenever we discover that we cannot create superior and compelling value for the customer, we need to walk away.  We need to stop wasting the customer’s time and our time.

What happens, when this starts happening frequently and systematically?  What happens when your peers start discovering the same thing?  This may be an indicator, that our customers and competitors have passed us by—our products and solutions are no longer competitive and no longer produce differentiated value. 

Unfortunately, this is very common, and unfortunately, many corporate reactions are completely wrong.  Too often, the reaction is to redouble and intensify activities.  New sales programs, new marketing programs, new initiatives — all costing a lot of money are put in place.  We try to spend or shout our way into creating value and differentiation.  We may try to frighten the customer using tactics Rebel describes as FUD.  These tactics may be successful for some time, but usually don’t create sustained success and growth.  Customers will find solutions that create value for them—they just won’t be our solutions.

Often, we see another thing, the company decides to ignore the customer, somehow thinking it knows best.  Business history is littered with the carcasses of once great companies that have done this.  When I started selling computers, there was IBM and the BUNCH.  All of them have fumbled, most are dramatically different now.  What about those that no longer exist, great companies like Digital and Wang (and so many others) that failed to satisfy customer needs and create compelling value in the face of customers continuing to raise the bar on what value is.  We can see the same thing in every other sector–today the finance, automotive, and healthcare are the most visible..

It’s an interesting question:  “What if we can’t find a compelling value-based approach to our solutions?”  It’s a wake up call for any of us who experience it.  The solution alwasy starts with the customer.  Whether a sales person looking at winning a deal, or a company looking to make their solutions relevant, it the solution starts with engaging your customers in a conversation about what they really value.

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14 Comments
  1. This is one insightful post. The question in the beginning is really quite unnerving.

    In my own point of view, getting people to relate better to your brand takes more than a complete overhaul of values and ideas. I think getting down to basics is one thing, and bravely facing the obstacles we will meet along the way is another.

    • Paolo, thanks for your thoughtful comment. It is an unnerving problem, I think more companies than one might suspect might have this issue, but they don’t confront it.

      Thanks again for the comment

  2. David Locke permalink

    “Value Merchants,” would provide you with some insight in how to expand the value of your offers and how to price them. Value-based is generally frowned upon by sales, because it changes the sales process. Value-basing does support pricing, so you don’t have to reduce your price. It will also help you price all of the services in your offer, find holes in your offer, and find demand-side services that could be implemented without leaving your market.

    Value migrates. Symbols inflate.

    • David, thanks for your thoughtful comments. Value Merchants is a great resource in helping people understand, deliver, communicate, and price value. Too few organizations execute the pricing component of value. Many or the concepts in Value Merchants are similar to the other posts I have done on Value Propositions at this blog site.

      You make an outstanding point about finding deman-side services that can reinforce, strengthen, or even change your value proposition. Companies tend to focus on their “product” and not a set of surrounding services that complement the product. These are often the most powerful elements in developing and delivering your value. They are the most sustainable differentiators, and the most sustainable in pricing issues.

      I really appreciate you taking the time to comment! I also recommend Value Merchants as a great resource. Regards, Dave

  3. Hi Dave, a post near and dear to my heart. Scary to wake up one morning and realize that you can no longer compete. I think there is a lot of this going on right now, but unfortunately, much blame is being placed on the recession. I was sitting in on a webinar yesterday and there was a great quote by Lisa Barone: “it’s not the recession, you just suck!” (excuse the verbiage, its a quote). Too many organizations are going to say that they will wait this out and things will get back to normal, but I’m thinking normal has changed, and will keep changing at a pace that many execs aren’t accustomed to. Like you said, it all starts with the customer, so we all better find out what they’re thinking right now, and quick!

    • Keith, fantastic observations. We are in the “new” normal (I’ve always thought continuous improvement and constant innovation were part of the “standard.”), those that don’t adapt and improve will be swept to the side. Thanks for continuing to read and comment.

  4. I have been in many situations where our company could discover no compelling value for our solutions vis a vis competition during a bid. On some of those occasions, we still managed to make a sale. On some of those wins, we still managed to deliver value and achieve great customer satisfaction.

    My point is, in the real world, people often buy things from someone because it is at least as good as what the competition offers (so, no COMPELLING value proposition) but because of the attitude of the sales team, because of the willingness of the bid team to be flexible and various such soft factors.

    If the customer was always making rational decisions, we should be paranoid about the un-compelling nature of our solutions. If, on the other hand, the customer is actually rationalizing, then we have to tap other levers. I blogged about this recently in my blog (bid-runner dot blogspot dot com).

    • Suresh, thanks for your comment. I think we are in agreement, though may be expressing the ideas a little differently. Too often, sales people ignore their roles in creating and delivering value–consequently, failing to consider it as part of their value proposition. The attitudes of th sales team, the flexibility of the bid team, and other soft factors are as important a part of the value proposition as the hard factors.

      Customers don’t make rational decisons, their decisions are a mix of business and personal reasons. The job of the sales professonal is to understand these and incorporate them into their value proposition. Thanks for your thoughtful comment.

  5. David: great post on a topic that’s relevant to almost every selling situation.

    Several years ago, I returned from a software demo I gave for a prospect and commented to my boss “they really wanted to see point-of-sale, and we were missing some key features that our competitors have.” His response: “Did you show them our ACCOUNTING?”

    He was so enamored with the accounting functionality(which WAS good!) that he missed recognizing what really turned prospect on. Would customers have been better advised to consider excellent accounting first? Possibly. But–right or wrong–point-of-sale is what excited them.

    A blog I wrote on this same topic “A Sales Force Needs More than ‘High ROI’ and ‘Low TCO’ to Compete describes a similar scenario about how a COO confronted a sales team with a value question they weren’t prepared to answer: http://www.customerthink.com/blog/sales_more_than_high_roi_low_tco

  6. Hi David, Great post, in my experience I see most sales people focusing on selling the product rather they should sell what the product does. As a sales professional – at first I did just that, just selling the product and competed in price, luckily I have had great mentors and read 100s of books, SPIN Selling, Valued-Selling, What your customer wants, Value Merchants, Art of selling, Consultative Selling, etc. What I learned from these mentors it is about Value – In the Absence of VALUE money is an issue! Now as a manager, I am drilling constantly on my people of bringing value to our customers, it has to be quantifiable in monetary benefits. Also found out that each one of our customers are different, our solutions change as our customers needs, even anticipated needs (no obvious to the clear eye). This approach makes you think deeply to search and search for our value, sometimes it is a matter of time, sometimes our customers require more some time to realize of our value, therefore time is our best ally. In the absence of VALUE, Money is an issue!

    • Great comment Juan! The concept of value is going even further, the value we as sales professionals create in the process is often the most differentiating. Helping our customers through their buying process is unique and very powerful, since most really don’t know how to buy!

  7. Bob Ennamorato permalink

    David

    Very interesting subject and something we struggled with for years as more and more “me too” products flooded our market. My “A ha” moment came while reading “The Dollarization Discipline: How Smart Companies Create Customer Value…and Profit from It” by Jeffrey J. Fox and Richard C. Gregory. At its core, all B2B customers and prospects are in business to maximize profit. There are only two ways to do that: reduce costs and/or increase revenues. Most companies, including ours, did not carry their value propositions that deep. They didn’t “Dollarize” their differential competitive advantage by using a “value chain” to show their offerings impact on their customers bottom line.

    For example: our products are safety products. Part of our value proposition used to be that they were more comfortable than our competitions. That faded over time as customers started seeing all brands of safety equipment as a commodity. But after applying the “Dollarization” principles, we developed a “value chain” that carried the impact of “comfort” all of the way to the bottom line.

    Value chain example: Our products are more comfortable than competition (so what?); workers who are more comfortable will stay on the job longer, produce more with fewer rejects (so what?); that increases productivity and reduces non-productive downtime (so what?) increasing productivity and reducing downtime increases profitability.

    So our revamped over-all value proposition is we sell “Profit Enhancement”. Our sales people are trained to walk every feature and benefit down the value chain until it impacts profitability. We talk to our customers about “investing” in (instead of buying) our products and we talk about the ROI being the impact on profitability. We also try to document the increases in productivity and reduction in downtime to offer as proof statements. It has been a very effective strategy.

    A prospect may tell you they don’t want or need your product, but few if any will tell you they don’t need or want to reduce cost, increase revenue and enhance profitability.

    • Great observations Bob! Thanks very much. I really like the point about profit enhancement and would add revenue enhancement. I think too often, we tend to focus on how our solutions reduce cost, but not on how they help our customers make more money—top and bottom line. I really appreciate the comment and hope to see you here more often. Regards, Dave

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