Value-based selling programs are fast becoming one of the most effective sales methodologies. At the same time, sales reps who rely on feature and function sales pitches are still far too pervasive in sales. This is a mistake. Those sales reps who take the time to understand their potential customers and co-create value are the ones decreasing sales cycles, increasing ACVs, and winning more deals.
If your sales team is still on the path toward creating a value-based selling program, then you are in the right place. The following article will walk you through, step-by-step, how to create a high performing value-based selling program.
6 Steps to Launch Your Value Selling Program
Step 1: Understand Your Customers
The first step to creating a best-in-class value-based selling program is to deeply and intimately understand your customer. There are a number of ways to accomplish this. Start with internal conversations. Talk with other members of your team and ask them what pain points or struggling moments your product is solving for your customers. Additionally, you should expand these internal conversations cross-functionally. Most members of your sales, customer success, and marketing teams should have frequent exposure to your customers and prospects, so there is a gold mine of data and information to be extracted from them. All of this will come to light the more you conduct these internal conversations.
However, only relying on internal conversations can be limiting. It's not uncommon for sales teams to have a bias toward certain pain points or value propositions, especially if there is a sales leader with an agenda. To counteract these biases, you should also be conducting (or purchasing) customer and prospect research to get a more representative perspective. This can come in the form of qualitative or quantitative research, depending on time and budget. Often, this research will help your team find common pain points or challenges that don't always surface during customer calls. These unique customer challenges can provide differentiated selling points, and give you a leg up on your competition.
Lastly, you'll want to use this data to create buyer personas for each of your unique buyer types. Later when you train your sales team, these buyer personas will be much more accessible than raw market research data.
Whichever research you conduct, all of these become data points to help you build a deeper understanding of your customers. This will be essential for helping you to build your selling propositions.
Step 2: Define Your Value Proposition
With these deep customer insights, you can now move on to the second step which is to clearly articulate how your product or service solves your prospective customers' specific problems and provides value. This is known as your value proposition.
Your value proposition should tie your solution to your customer pain points, challenges, and needs you identified in the first step. Your solution likely solves multiple customer problems. Start by identifying a thorough list of those problems and how your solution solves them. Next, describe the value your solution creates by solving each of these problems.
For example, if you find in your research that your customers struggle with the time it takes to enter data into spreadsheets and your solution solves this problem by automating the data entry process, then your value proposition should be tied to the value created by using your solution. In this specific example, the value would likely be tied to time savings.
Your job is not done once you've documented your value propositions. Before going to market, test this value proposition with your customers and prospects to get feedback. Go to them and ask open-ended questions like “Does this value proposition resonate with you?” and “Do you get value in these areas from using our solution?” This should give you either validation you've hit the mark or feedback on what to change before going to your market more broadly.
Step 3: Train Your Sales Team
Whether your value-based selling approach is a brand-new sales methodology for your organization or an incremental update to your current sales process, you are still going to want to take the time to train your sales team. While sales professionals typically spend the majority of their time working on their deals, they also appreciate improvements to their sales process that are going to help them win more deals. So invest the time in sales training. Here's what should be included:
First, educate your sales reps on the principles of value selling and the importance of understanding customer needs. Next, provide them with the buyer personas and value propositions you created in the previous step that is tied to each customer's pain point, problem, or need.
Round out your sales training by providing the team with any additional tools and resources they need to identify and communicate the value of your solution. Typically, these materials will originate with marketing so make sure you partner with your counterparts in marketing to create these materials prior to the training. Additionally, one of the best ways to learn is by example. This means you should include in your training the actual sales conversations of reps who have mastered this approach.
One last note on sales training - the training shouldn't end at the conclusion of the sales training presentations. Like with any new skill, adopting this new value-based selling approach will take reps time to master. Therefore, once the training is concluded, there should be a plan to give reps the opportunity to practice this new approach with an emphasis on value. Role-playing with a peer or manager, presenting in front of the sales team, shadowing other sales reps who have already mastered this new approach, or pre-recorded sales pitches are all ways to practice and get feedback. Practicing the value-based approach internally allows sales reps to refine their messaging, address potential objections, and gain confidence in their ability to communicate the value proposition effectively.
Additionally, before reps are given the green light to bring this new sales technique to prospects and customers, they should be required to pass a test. This could take on many forms. Some examples include a mock demonstration to a manager which includes value selling, completion of a case study, or critiquing other reps' sales calls. Whatever the chosen testing method is, reps should be comfortable with this value-based approach before bringing it to potential buyers.
Step 4: Implement Value-Based Pricing
The most successful value selling programs are the ones that infuse value in all components of the sales process. So far we've discussed ways to layer value in your messaging and training. But your value selling program will be incomplete if it doesn't show up in pricing as well.
Pricing can come in many forms from cost-based to consumption-based to competitive-based. But the one that aligns the best with value selling is value-based pricing.
Value-based pricing is where you set the price of your solution based on how much your customer or prospect perceives it is worth. And because you are setting the price so closely to perceived value, it ensures you aren't leaving money on the table by undercharging. It also acts as the connective tissue between your customer pain points and value messaging. In other words, if you've properly done your customer research and have a deep understanding of how important your customer's pain points are to them, then both value messaging and value-based pricing become an extension of this research.
Lastly, value-based pricing allows your customer to better understand their potential return on investment.
Step 5: Scale across the teams
Now that the value proposition has been tested and proven effective, the sales team is trained, and the price has been properly set, it's time to establish a model that can be scaled across the organization. While manual methods might be initially feasible, they can quickly become unwieldy and inconsistent as the business grows. Relying on manual tracking, reporting, and communication can be cumbersome and prone to errors.
Instead, adopting a dedicated value management platform can provide a scalable and consistent solution. Such platforms digitize the value management process, streamlining workflows and ensuring consistent delivery across teams. This not only empowers sales teams to focus on building relationships but also enables them to consistently demonstrate value to customers at every stage of the customer journey.
Step 6: Measure and Optimize
Even if you've followed each of the previous steps to the letter and launched and scaled your new program, there is still work to be done. In fact, the work never ends. Your value-added selling program should be ever-evolving, especially as your customer needs change or the market changes.
To stay on top of these changes, it is important to track key performance indicators (KPIs) to measure the effectiveness of your value selling program. Additionally, you should gather feedback from your sales team and customers to identify areas for improvement. This feedback loop is essential for continual optimization. By analyzing the data and insights gathered, you can identify any gaps or areas of improvement in your value-based selling program. Adjustments and refinements can then be made to ensure that your sales strategy continues to deliver value and meet the evolving needs of your customers.
Adding value at every interaction
One last note on value-based sales: the most effective sales teams are the ones who think about value at all stages of the buying journey. From customer research to value messaging to value pricing, all of these components must be considered at all points in the buying process. Consistency is just as important as mastery.
Conclusion
Value-based selling is a powerful approach that allows sales teams to shift their focus from simply selling products or services to delivering value and solving customer pain points. By understanding the specific needs and challenges of your target audience, crafting a compelling value proposition, training your sales team, setting the right price, scaling across teams, and continually measuring and optimizing, you can launch and sustain a successful value-based selling program.
Making value the core of your sales strategy will not only differentiate you from your competitors but also build trust, foster long-term customer relationships, and drive bottom-line growth.
