Friday December 6, 2013
Huthwaite International’s Creating and Capturing value survey emerged as a result of me spending quite a lot of time reading various blogs and articles on the internet from a wide range of sales gurus. All of whom were claiming to have discovered the secret to effective selling, and what needed to be done differently in this new world of selling in the Information Age.
Unfortunately, when I read through most of the articles I found re-statements of ideas that have been around for a long time. For example; the idea that you need to focus on the customer’s business and understand their needs. Well, hello. We know that. The fact that a large number of the sellers that I see in the training room are still fundamentally product-focused, because that is how they are targeted, and that is what they live and breathe each day, doesn’t mean that being customer-focused is a new idea. It just means that there are still sellers out there who haven’t realised that yet, and organisations that choose to reward sellers on the basis of how much product they sell also have not realised that yet.
Creating and capturing value through building relationships
The Creating and Capturing Value survey revealed what sellers liked to think that they were doing when it came to creating value for their customers. So the most popular value-creating behaviours reflected a consultative approach to selling. Joint problem-solving was the number one favourite, closely followed by Maximising value for both sides in a negotiation. So sellers like to think that they are cuddling up to their customers and building relationships; yet when we asked them for actual examples of how they created value fewer people offered ways of working with the customer (which would reflect a joint problem-solving relationship) than offering a description of their solution. And when it came to examples of real value propositions over half (57%) were product descriptions with no inherent customer value described at all.
Creating and capturing value through managing time and resource
On the other hand, value-creating behaviours that reflected an efficient approach to selling, such as Qualifying out prospects where they could not add value, so that they did not waste time and money chasing business they were unlikely to win, or segmenting their customer base between transactional buyers and consultative buyers, so that they could direct the appropriate sales resource to the appropriate customer, were not as popular. In fact they consistently emerged as the lowest scoring factors. Interestingly, other research from the field highlights Qualifying out as being key in both transactional new business sales and for major complex deals. The reason being, it enables sellers to manage their time and resource more effectively, as they focus on business they are more likely to win, and it improves morale and motivation, as they encounter less rejection. Within the Creating and Capturing Value survey itself Customer segmentation appeared in places as a differentiator; i.e. organisations reporting increased profit over the past two years scored significantly higher for Customer segmentation than loss-making organisations. So yes, being customer-focused is just as important as it always was. But it’s not all about the customer; the modern salesperson and modern selling organisation needs to understand how to organise and direct its resources to stay lean and competitive in today’s world.
To download the research report please click here.