Written by Sean McPheat |
Have you ever heard of value-based selling and how to implement it?
The clue is in the title. I’m sure you’ve always been told to sell value and to raise the perceived value of your products and services when selling. Value-based selling is how to do exactly that!
In short, value-based selling is all about positioning what you sell so your customers understand how it creates value for them. It’s something that we always cover in our sales training courses and it’s a very popular topic. In this guide for beginners, we’re going to look at a definition of value-based selling, what the benefits of the approach are, and the methodology behind it all.
It’s a switch in mindset! As sales expert and author of “Value-Added Selling” Tom Reilly told business publisher McGraw-Hill, “I directed my focus to creating something of value for others. With customers, this meant that I should spend more time thinking about what’s in it for them and less time thinking about what’s in it for me.”
It’s a way to use empathy and psychological insight to ensure that you’re selling something that provides real value for your buyer. It can also be contrasted with benefit-based selling, which focuses more on physical advantages of the product.
Here’s an example of some products you might be tasked with selling, and the contrasting benefit and value-based approaches:
You can probably already see the difference. The benefit-based approach appeals to a buyer making an intellectual assessment of the selling proposition. The value-based approach, however, appeals to emotional triggers. If you think of almost anything you buy, you can identify how you want to feel when using it.
Clothing can make you feel confident, comfortable (or anxious). Food can make you feel content, healthy (or bloated). A new smartphone app can entertain or inspire (or frustrate). In value-based selling it’s important to recognise that there can be negative values too if the product-buyer match is bad.
Or to put it another way, benefit-based selling stresses what the product is, whereas value-based selling emphasises how it can make you feel.
However, value-based selling is no snake oil trick where the customer is fooled into buying something they have no need for. Rather, you are tapping into what the customer really wants, and ensuring they get that from the deal. On occasion, a value-based selling approach may lead you to turn down a sale, if it will result in a customer buying a product that will not benefit them or bring value into their life.
Value-based selling works wonders because it bypasses a lot of the barriers a buyer may instinctively put up when facing a purchase choice.
If you ask your buyer the right questions, and find out what emotional need could be satisfied by a purchase, you’ll be able to connect your product with something deeper than a mere list of product benefits.
This is a truth long understood in the world of advertising. Watch any TV commercial and see how what’s being sold is a feeling, or a state of mind, as well as the brand in question. Behind every sale there is a buyer who wants to satisfy a deeper need; helping them do that will often result in a sale.
Remember that value-based selling requires you to be conveying value in every interaction with a customer too. Therefore, you should be informing, or reassuring, or answering questions, or offering alternatives, rather than cajoling or pressuring.
Here are the benefits of trying this more emotional, connected form of selling:
This latter point is important. So much modern business relies upon user reviews, social media chatter and positive word of mouth. Therefore, it pays to be the kind of brand that people talk positively about. A value-based approach is more likely to result in good PR.
In the words of a recent HubSpot article, “the goal of value-based selling is to close the sale by putting the needs of your prospect first.” To do that, of course, you must know what those needs are, which means good communication, and good listening, is vital.
Let’s outline the steps in building rapport which will allow value-based selling to work its magic.
To find out what a customer wants and needs, you must go deep. Before you approach them face-to-face or on the phone, or even by email, you should do a bit of background research. You’re trying to find out what deeper needs they are trying to satisfy, so that you can offer real value.
Here are some potential sources for that information:
The amount of research you’ll do will be proportionate to the probable value of the sale.
Once you have completed your research, you can make contact. In each encounter, lead by asking questions, and listening hard to what your prospect says. Pay particular attention to any emotional terms connected to pain points. Here are some examples:
You can then draw conclusions of what value point you can provide based on what the prospect has said. The words below reveal the underlying values of the pain points expressed by prospects in the above examples:
It’s vital not to jump straight into a sales pitch before you’ve heard what the prospect wants and needs. Remember that in value-based selling you’re focused on the customer, not on your own KPIs or commission!
Once you’re sure what emotional or deep needs the prospect has, hopefully you can tie your sales pitch to those values.
Another way of thinking about values is to see them as a solution to a problem. Your prospect is facing some sort of difficulty generating negative emotions, and you can provide a solution, thus relieving their difficulties.
Now you must clarify how the design of your product means it can solve that problem, and thus convey real value.
A frustrating work process can be solved with greater efficiency and simplicity. This conveys the value of easier working methods and better results. Express how your product will reduce frustration, and you’re halfway there.
The need for a romantic getaway can be solved with a timeshare property, which is guaranteed to provide privacy, relaxation, and convenience, in a lovely location. Explain how your properties are designed to create that romantic trip to remember.
You’re aligning the real benefits of your product with the identified needs and values of your customer. This makes the sale a mutually beneficial one and allows for a more honest and genuine transaction.
This may seem counter-intuitive, but you don’t need to take a hard-sell approach when your product’s benefits are aligned with customer values.
Instead, what you’re doing is ensuring your buyer has all the information they need to make an informed choice. Demonstrate value rather than force-feeding it!
Hopefully your prospect will ask questions which allow you to list some of the appealing features of your product. However, remember that you’re focused on the value that each element brings. Don’t bring up a benefit if it’s not in alignment with what they need.
Because you’ve researched your prospect and actively listened to their needs, you’ll already know what aspects of your product best fulfil those requirements. You simply provide the solution they are looking for.
Value-based selling requires a human connection, which means you must be genuine and speak person-to-person, rather than be excessively formal. Even in high-level B2B sales, it helps to build a human connection.
Avoid risky humour, but do feel free to use small talk, and any personal connections (perhaps your prospect’s LinkedIn profile reveals that, like you, they’re a keen runner). However, you must remain natural when you mention such a connection.
Talk as if you’re with a friend, and don’t be put off by any perceived status imbalance. Remember that your prospect would not be spending time talking to you unless they thought you may be offering something of real value.
Trust is essential – your buyer needs to feel they are receiving insight from a trustworthy advisor. And yes, this means if you know your product isn’t right for your prospect, you let them know that. There’s no point in miss-selling and then inviting complaints, bad PR, and terrible online reviews later.
Remember that each interaction must add value. You are not simply pushing your buyer towards a sale; you are leading them towards a self-motivated desire to buy.
Make sure you’re asking questions, clarifying points, sharing documentation, or pricing information. Each point of contact offers value to your customer, helping them make an informed choice.
Good etiquette should be maintained – don’t interrupt, do allow time for questions, and offer added value when you can. Simple things like sharing a helpful article, or promptly sending through some product information, can really contribute.
You want your prospect to leave each interaction feeling that they benefited and are closer to a decision. Hopefully it’s the decision to sign the deal!
Since value-based selling requires asking a lot of questions, what are some good queries to set the ball rolling?
Here are just a few:
The last question is the classic shopkeeper’s open-ended query. It may sound trite, but it’s value-based in nature. The shopkeeper isn’t saying “what can I sell you?” or “what are you looking for?” They are simply asking what kind of assistance they can provide.
Questions to AVOID in a value-based approach would be:
These sorts of questions aren’t focused on the emotional value your product provides, and they aren’t sufficiently open to allow your prospect to tell you anything that lets you align your product with their needs.
It may be helpful to finish with a couple of scripted examples. The first is an example of a B2C sale (a holiday package) and the second is a typical value-based B2B sale.
Salesperson: “So what are your main priorities, would you say?”
Customer: “Well, we’re looking for sand and surf, somewhere with family activities, but quiet in the evenings, and not too pricey.”
Salesperson: “Sounds like my kind of trip. Is there a part of the world you’re thinking of?”
Customer: “We were thinking of the Caribbean or the Mediterranean.”
Salesperson: “We have some great deals on Barbados packages. They include snorkelling and boat trips, are ideal for families, and the hotel is situated away from the clubs and bars, so it tends to be quieter at night. If that sounds interesting, I can send you some links.”
In the above example, the salesperson leads by asking the customer for their must-haves. In answering, the customer reveals that their values are peace and quiet, family-orientation and value-for-money. The salesperson asks a further open question to narrow down the options and adds a comment that stresses a connection.
Finally, the salesperson closes this interaction by offering to provide more information. Though they may not close the deal on this conversation, they have provided real value and identified the emotional drivers behind the buyer’s preferences.
Salesperson: “What do you hope to use a chatbot for?”
Prospect: “We want to make sure we respond to enquiries ASAP. We’d also like to lighten the load of our IT and customer support teams. Lastly, we want to inject a bit of fun into quite a dry business.”
Salesperson: “I get where you’re coming from. The trick is to balance providing helpful information with not frustrating a contact. That’s why our ‘bot allows you to connect to a human at any moment, but it can also answer 90% of customer queries itself. What are your core brand values?”
Prospect: “I’d say reliability, quality, and speed of installation. We do a lot of work in showrooms and factories, so downtime’s a big deal.”
Salesperson: “I hear you. Our chatbot can be tailored in terms of its ‘personality’ so if you want something more informative and less quirky, we’ve got that covered. Might it be helpful to see a demo, one we did for one of our other commercial clients?”
Prospect: “Sure! Go ahead.”
The salesperson demonstrated that they understood the prospect’s pain points and asked a great open question about brand values to ensure the product would fit in with who and what they are about.
They reassured the prospect that their product would satisfy their must-haves and offered a helpful and tailored demo.
Hopefully these examples have clarified how natural and honest a value-driven approach to sales can be. After all, it’s built upon giving the customer what they genuinely need, and it should result in sales that satisfy both parties. And isn’t mutual benefit a sales rep’s holy grail?
Have you ever benchmarked your sales skills? Try out a sales assessment to identify your strengths and areas of development. Within that you’ll also discover whether you’re adding value within your sales. If you’re looking for some skills development then please check out our Essential Selling Skills Training and Sales Management Training. Both courses will give you what you need to improve.
Updated on: 2 May, 2023
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