The Art of Selling at Full Price

 

Below is an article written by Lawrence Dawood, the Director of Training for Wireless Toyz, a franchised cellular retail chain. The original audience for this article was the Operations Field Staff for the chain who were experiencing significant hardship in weaning the franchisees away from “bargaining” for customers.

As I read this article again recently, it occurred to me that the issue is not limited to the cellular industry, and that Lawrence’s thoughts could provide assistance to many business owners in many industries. Throughout my career I’ve worked with companies and clients in a wide variety of industries and have found this issue to exist in most of them – sales people are afraid of the difficulty of selling “value” so they resort to selling “bargain” to achieve a closed sale, which ultimately harms the business financially. In previous training that I’ve conducted on consultative selling, this “value” proposition has typically been enthusiastically received, but rarely implemented once they’re back in their home environment. I’ve come to believe over time that the reason is because we haven’t started the change in the thinking process where we need to – at the top, with the business owners.

So my thought in making this article available to you is to bring the dilemma to the forefront if it exists in your organization, and to provide you with some “tools” to help eliminate the issue. Therefore, when you read the article below, substitute your industry and product into it wherever it references the cellular industry and products, and I believe you will find benefit in it as well.

 

Selling Value Not Price

 

  “Our products have become commoditized and our customers only care about price.”

This was the opening volley at a recent sales training session when I introduced the idea of Selling Value Over Price. The salespeople’s resistance to the idea was strong and quite predictable given what’s gone on in our marketplace over the last 5 years. Far too often in the cellular market, we have degraded our value proposition to the point of offering our products for “FREE!” The wireless industry has taken one of the true “miracles” of communication – the cell phone – and systematically stripped the value from it to the point where customers “expect” to get a new “FREE” phone almost every year.

Cellular Agents are looking at their bottom lines wondering where it will end and how they can slow the degradation of their business.

While we can’t sell every customer and prospect at list price, there is still a large percentage open to a well-defined value proposition that begins with the following 3 Steps.

1. First, you’ve got to BELIEVE!

I asked the sales team a question. “Do you believe that YOU and what you offer are worth more than the other guys?”  They all chimed “YES!”, except one guy who probably should change the title on his business card to “Giveaway Expert”. We then set out to answer the following questions.

  • “Why should a customer pay us more than the other guy who offers a similar (or the same) product?” and,
  • “How do we convey this to the customer?”


They listed about 2 dozen reasons why the customers should pay more for their services than their competitors.

The next key was to transfer these “added values” into a tangible part of what they offer to their customers. If your sales team (from the Owner on down) doesn’t believe that you’re “worth more” than the competition, then you’re not. Game over. Play the discount game and good luck.

However, if that isn’t where you want to be, then try the above questioning exercise with your sales team and then read on.

2. Define your Value Proposition

Building a Quantifiable Value Proposition for your customers begins with the understanding that “value” often comes in the elements that we wrap around the product, and not in the product itself. Products have become so similar, that the focus must shift from the product to “the relationship.” Here are some of the elements of value (beyond the product) that can add tremendous value over the life of a customer Relationship:

  • The “expertise” of your personnel at uncovering problems and helping the customer to solve them.
  • The resources and special services of your company on the sales and service sides of the business.
  • Knowledge of Applications-how other customers creatively utilize your products and accessories to improve their efficiency and profitability.
  • Your ability to demonstrate ROI (Return-on-Investment) in terms of how our products, expertise and company resources can help to increase our customer’s revenues, decrease their costs, and/or impact their bottom line.
  • Your ability to quantify all of the above in dollars and cents for the customer.


3. Improve Sales Competencies

As an industry, the wireless business (at least on the cellular side) has transformed itself from being “problem solvers” to being “promo-pushers.” The average cellular salesperson would go into withdrawal symptoms if you took away his/her promo’s for the next quarter. Hiring people after they’ve been in this business for any length of time is almost a guarantee of lower margins. Therefore, upgrade your sales team by hiring reps who are “Problem Solvers” vs. “promo pushers.” Hire people who understand Step 2 – how to define and sell “value” beyond the product and a potentially lower cost.

For existing reps, it is critical to increase their competency at uncovering what customers will pay extra for and conveying this during their presentations. This takes training and on-going role play on a weekly basis. Look at the deals you sell for the largest margins and dissect the reasons why customers purchased from you vs. going to a cheaper alternative. Selling “Value” is not an easy transition for most salespeople, but an essential one if they want to boost their income… and if you want to boost the profits at your company.

So the bottom line is to focus on creating a value proposition for your customers and training your team to package and present along with the product. You’ll find this to be the most profitable sales decision you can make… and it’ll show up on the last line of your Profit and Loss at the end of each month. 

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