Over the course of the last 30 years, a variety of sales methodologies have come in and out of vogue. Consultative Selling, Solution Selling, and Challenger Sales are just a few memorable examples. What is striking about each new iteration, is the degree to which most of these "new and improved" approaches are not actually new and improved, but merely predicated on a repackaging of familiar tired tropes. In most cases, each new methodology offers little more than a new set of terms for many of the same tactics and strategies. In the case of "Value Selling" it is important to recognize two realities:

  • The fundamentals of human communication don’t change; modes of communication and the context of communication are where the changes take place.
  • Multiple studies have proven that the industry of "sales performance improvement companies" is larded with myth, anecdote and false assumptions.

A new methodology that actually warrants praise is Value Selling. While the moniker may seem similar to other methods, Value Selling is so much more than just a new label. Value Selling, when done correctly, redefines many sales best practices. Let’s explore what Value Selling really means and why it can improve outcomes for both sellers and their customers.

Table of Contents

Introduction to Value-Based Selling

Value-Based Selling (also called Value-Added Selling) is an approach which focuses the seller’s efforts on creating insights for prospects and customers to ensure both buyer and seller get the greatest value possible. Many sellers have heard that successful selling is about how you sell more than it is about what you sell. This mantra has been around since early 2003. Unfortunately, developing the skills to exercise this guideline require a greater level of expertise than most companies allow their sellers to master.

Having a quality, differentiated offering is now a "ticket to the dance" and is no longer sufficient for maximizing growth. Unless a company’s offerings are innovative and/or disruptive, competitive offerings are only enough for most customers to put the seller on the "short list" of competitors. Buyers now expect sellers to be decision coaches capable of helping them navigate the buying landscape. Sellers need to have the skill to employ the two most important rules of selling:

Rule 1: Customers put a higher value on what they conclude and on what they tell the seller than they assign to what the seller tells them.

Rule 2: Customers put a higher value on what they ask for then they assign to what a seller freely offers.

For most, these two principles are challenging enough. But to be able to help customers conclude with clarity how they will make a choice, how they define the outcome that will provide the greatest long-term benefit, how they will uncover the most important elements of a solution, etc. requires a skill that most sellers don’t have and which the organizations they sell for will not train them. This is sadly short-sighted. Multiple studies have shown that Value-Based Selling outperforms all other approaches by a wide margin.

Developing a Strong Value Selling Framework

Setting the stage for developing a Value Selling sales force is fundamental to successfully employing Value Selling principles. Training your team on the principles of Value Selling can produce a surge in performance. To sustain that surge, companies must embrace a Value Selling approach with the following elements in place.

  • Sales managers are prepared to be performance "force multipliers" and help sustain continuous performance improvement. However, it is unrealistic to expect that managers can simply do this on command. Therefore, any effort to embrace sales performance improvement must equip managers with the structure, resources, metrics and skills to coach/reinforce. It has long been realized that training sellers who are not given a clear, simple and routine processes for adoption and mastery will not be able to maximize performance.
    Further, too few sales managers are trained on the principles of coaching and are given little to any guidance or resources to implement effective continuous performance improvement. The good news is that this issue is not difficult to address. The key is to have resources and training available for managers before their sales team is trained.
  • The product team needs to ensure that sellers know how their products and services create value for customers. This is profoundly different then feature/benefit lists. Every seller needs to know the primary, secondary and tertiary benefits/outcomes that the company’s products/services produce for customers both in the immediate timeframe and over the long term. It is vital that sellers do not adopt an approach of rushing to demonstrations, presentations and/or "lecture" customers about how wonderful their products and services are.
  • Sellers need to master the tactics associated with the "two rules" mentioned above. This means knowing how to have conversations with customers that create value and don’t rely on simply communicating value. Skills such as attentive listening, framing of questions, uncovering where in the customer decision journey each decision maker is focused etc., are essential to Value-Based Selling. Again, these are not difficult objectives to achieve, provided the company wishing to do so has engaged a vendor prepared with the necessary resources.
  • Lastly, each seller should be paired with an "improvement buddy." Data on this issue show decidedly faster adoption, faster mastery and more sustainable outcomes when each seller is paired with a peer where each member of the pair keeps their teammate accountable for following a reinforcement/mastery guide in short weekly 30-minute sessions. Adding an element of competition between pairs provides even more lift.

Key Methodologies in Value-Based Selling

There are several methodologies that embody the principles of Value-Based Selling. The challenge facing those looking to implement one of these methodologies is that there are far too many providers who claim the title but lack the key elements. There are several components to look for:

  • A model of how customers make complex decisions. When presented correctly, the Value-Based Selling model of customer decision making is structured with stages that represent what "gate" each decision maker would pass through if they were making a good purchasing decision. Too often, representations of customer decision models focus on the activities of the seller and ignore the gates decision makers pass through.
  • A taxonomy of decision roles. Specifically, recognition that decision roles are not defined by job title. The key here is to enable sellers to recognize the three orientations that these roles represent. At its simplest these include:
    • The decision maker who can impose their will on the decision. These individuals focus on how a purchase will impact the overall company or division.
    • The individuals whose evaluation focuses on how the solution will impact their day-to-day jobs or the jobs of their team members who will employ the solution.
    • The individuals who evaluate the proposed solution from the perspective of technical issues such as compliance, contracting, finance, procurement.
  • Clearly, each decision maker that progresses through their customer decision journey will have a different perspective. Being able to create value for each of these decision roles, and being able to uncover who is in each decision role is fundamental to employing Value-Based Selling.
  • Training on the skills and tactics of active listening, conversational use of persuasive questioning, knowing the importance of uncovering/validating/influencing important information about the perspective of each decision maker, etc.
  • Recognizing that qualification is not a single step in the sales process. Rather, qualification is a part of the sales process at every stage of the sales effort. Knowing how to continuously qualify an opportunity is fundamental to being able to implement Value-Based Selling.

Techniques for Effective Value Selling

Here are five Value Selling guidelines salespeople should adhere to during their sales interactions:

1.) Understanding the Customer’s Business and Doing Research Before Meeting with Any Decision Maker

It is important to understand the current challenges your customers are likely most concerned about, and beginning any sales effort with a hypothesis of why the decision makers are likely seeking a solution the seller represents.

2.) Using AI Tools to Help Formulate a Pursuit Strategy

One the primary symptoms of a sales force that lacks Value-Based sales skills/strategies is a predominance of discounting and price-drive decisions by purchasers. The current fear that sellers will be replaced by AI are misplaced. At least in the near term, sellers that focus on price as their primary differentiator will be the first to get replaced. Their replacements are far more likely to be sellers who understand Value-Based Selling than large language models employed in AI applications.

3.) Helping Prospects Define "Success"

Those making complex decisions are often saddled with the challenge of not knowing how to formulate the best possible definition of the outcome they seek. This opens the door for those with Value-Based Selling skills. The successful sellers of today are prepared to serve as decision coaches not just product/service reps.

Unfortunately, prospects don’t always do the due diligence needed to think about a successful outcome. Most will have a general idea, but a salesperson that is selling with a Value-Based approach will help their potential clients settle on what a successful outcome could be.

4.) Ensure that Your Solution Would be a Good Fit

Once a salesperson has a good understanding of their potential client’s circumstances and have helped them define success, it is critical to make an evidence-based evaluation of whether the solution the seller represents is the "best fit" for the customer. Once again, this requires that the seller has the capability to counsel the decision makers on how best to evaluate the alternative solutions offered by those seeking the business.

5.) Plan for Every Call

An ill-prepared sales rep can seldom provide value during a sales interaction. It doesn’t have to be a meticulous or detailed plan, but there are some general items that a seller should always prepare before every call.

Here are a few questions salespeople should always consider as they prepare for a call:

  • What is the prospect expecting to learn during this call?
  • What do I need to learn about from the prospect?
  • What details do I need to confirm with the prospect?
  • What questions should I ask to help prospects move forward in their decision process?

If a sales rep prepares these questions and plans for the sales call ahead of time, they can be equipped to share the right information when it is relevant for the prospect. They be able to create value for the prospect during most sales interactions. Remember, how a seller sells is often the key to winning a deal.

In summary, creating value during each sales interaction is what consultative/Value-Based selling is about.

Case Study: Value-Based Selling Results

An example where adopting a Value-Based Selling approach has produced the kind of outcomes most companies are seeking can be seen in the following company that we worked with. Our client focuses on banks and credit unions. Specifically, this client provides banks and credit unions with a variety of SaaS applications. Prior to adopting Value-Based Selling, the sales team was consistently underperforming against quota, used discounting in almost every case and had a difficult time expanding existing client relationships (i.e. through cross-selling and upselling.)

A year after the Value-Based Selling approach was introduced:

  • Managers were prepared to coach/reinforce.
  • Resources for coaching/reinforcement were available.
  • Sales metrics provided forward-looking evaluation of each sales rep

The results:

  • Quota attainment improved dramatically. Specifically, quota attainment per rep went from under 30% of the sales force to over 73%.
  • Average sales cycle time went down by 12%.
  • Average sales price increased by 7%.
  • Time-to-productivity for newly hired sales reps decreased by 16%.

Furthermore, performance continues to improve. Sales rep turnover continues to drop and the morale of the sales team has improved with 35% more of the sellers reporting high degree of satisfaction with their employer.

Implementing Value-Based Selling in Your Team

Are you interested in learning more about Value-Based Selling and how it can transform your team’s process? To implement a Value-Based Selling approach, reach out to us at Funnel Clarity today for a free 30-minute sales funnel consultation.