The terms value selling and solution selling are often used interchangeably to refer to sales approaches that center the sales conversation on the customer’s priorities, objectives, and desired results versus the features of the product or solution. While there are some similarities between value selling and solution selling, the two have some important differences.
First, let’s take a look at the high level definitions:
Value selling focuses on showing customers the potential value they can gain from using your product, service, or solution–in quantifiable terms. Sales conversations address each customer’s holistic needs–including desired business, job, and individual outcomes–and focus on the key metrics each customer values most. In other words, the value-based selling approach shows a solution will measurably benefit the buyer and help them solve their challenges.
Solution selling focuses on tailoring the sales conversation to each customer’s unique challenges and concerns, helping customers envision the impact of the solution on their business. A salesperson will only recommend specific products or solutions once they have a comprehensive understanding of the prospect’s unique needs.
You can already start to see the similarities between the two sales approaches. That is, both solution selling and value selling emphasize listening to and understanding each prospect’s true needs and challenges before presenting the value of the solution.
For both approaches, sales calls are not driven by canned presentations, but rather are structured as a dynamic collaboration between customer and vendor. Furthermore, both solution selling and value selling focus on a product or solution’s outcomes versus its features.
There are several important differences, however, when it comes to how these outcomes are communicated. For example, value selling focuses on real-world quantifiable value, while solution selling focuses on results that are not necessarily measurable.
Value selling further leverages customer case studies as proof of measurable success from previous customers. For example, if one of the prospect’s desired outcomes is driving a 99% accuracy rate for an application within four months of deployment, value selling would show a customer success story demonstrating similar results. In contrast, solution selling helps prospects imagine what it would be like to use the solution.
A value-driven approach is incredibly powerful because it helps customers clearly see the quantifiable value of your solution for their unique business needs–from their initial conversation with your sales team through realizing actual, real-world value as a customer. As a result, this approach offers many business advantages:
With value-selling, sales teams are freed from competing on price–because they’re empowered to compete on value instead. With other sales approaches, going up against a competitor can put pressure on sales teams to discount prices to match the competition. In the worst case scenario, sales teams may find themselves in the position of discounting heavily and diminishing profit margins to avoid losing the sale.
With value selling, price is no longer the primary differentiator: value is. Salespeople focus on building trust with the stakeholder and instill confidence in the anticipated results of the solution. This means your sales teams can hold their ground on price without risking the deal. Overall, by reducing the need for discounts and lengthy negotiations, value-based selling helps sales teams close bigger deals faster.
Learn more about how value selling can increase your business’s bottom line.
Another important aspect of value selling is that it drives early alignment on expectations because customers and vendors immediately begin the process of co-creating value. Desired outcomes and the path to success are clear and measurable. Milestones and metrics are clearly defined early in the process, eliminating surprises further down the road. This not only builds customer confidence and loyalty, but it also makes it possible to quickly identify and make adjustments for high risk accounts and cross-sell or up-sell into existing accounts.
Finally, value-selling creates a seamless transition from sales to customer success. With a natural handoff from value selling to value realization, customer success teams have a clear roadmap to understand what success looks like for the customer–and how to communicate these results to the customer as they become reality. This helps improve the effectiveness of customer success teams and ultimately, enables your team to build trusted, long-term partnerships with their customers.
To learn how value selling can help your organization, please contact us.