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How to create value for customers and grow sales

We often hear people extol the importance of creating value for customers because it's irrefutably the essential purpose of the sales process. However before we discuss how to build value, let's establish why it's so important.

All too often salespeople act like 'walking, talking brochures' in the sales consultation process, simply regurgitating product information. But customers don't buy facts and features, in fact they aren't even product oriented in their thinking; they're focused on solutions to their problems and solving their problems is what creates value for them. So when a sales team beats its chest and rattles off the great wizardry that goes into its products, salespeople fail to position the product as the answer to the customer's pain, frustration or aspiration. Instead, they're actually positioning it as a commodity, allowing the customer to base more of their purchasing decision on price and thereby pressure profit margins.

The underlying goal of every sales process must be to create value for customers by understanding the problems (or challenges, opportunities and aspirations) confronting them. Customer 'problems' manifest themselves in many different ways. In essence a problem is simply nothing more than the difference between what a customer is experiencing or achieving now (their existing situation) and what they need or want, that is what they'd like to achieve. The gap between the two is the problem, and it becomes our opportunity to create value; the scale and nature of the gap will usually determine how much urgency the customer feels to act on it. Our sales challenge is to understand that gap, and develop solutions through our products and services that help the customer solve the problem and satisfy their needs.

When salespeople create value with their proposition in the eyes of the customer, the customer gains the opportunity to see it as unlike any other in the market – almost as if you've created a new market segment of one. This also has the effect of repositioning your competition, so that price becomes a less dominating factor in the purchasing decision. Sure, price will always be an issue, but if the customer perceives unique value, price will never be the issue.

Creating value not only transforms sales effectiveness, it also provides insulation from price pressure.

Creating customer value starts with knowing the customer

There are sales strategies, tactics and techniques for creating value for customers, but what is too often neglected is the legwork required to effectively implement any of these. As professionals, we need to get inside the head of the customer and develop a good understanding of what they value. Because it should go without saying that all customers value different things; there's no cookie cutter model of what customers value and how to create it for them. This even goes for people within the same organisation – what a purchasing manager values in your proposition can differ greatly from what a business owner, finance director or C-level executive values. In your contact with all of the people that make up the customer buying team, you need to ensure your sales communication is appropriate for each of them.

To get inside the customer's head, you must build effective customer relationships (much more on this topic in that link). By solidifying the relationship, you'll be able to get a much better sense of their current business situation and where they want to be – information you can use to position your value proposition to address their problem and needs. Use this time to ask the probing questions that will draw out this information and be sure to truly listen to their responses! On key points and issues, reflect their response back to them so you can confirm if you're understanding them effectively. Not only does this verify the information and allow them to clarify if necessary, it demonstrates your thoroughness and desire to understand their situation and needs, and how your value proposition may be able to help. Critically it builds their confidence in you, and your confidence in yourself and your solution.

Solidifying the relationship also allows you to learn how to communicate with the customer: Do they prefer to interact in a friendly and casual manner or do they want to remain very professional and to-the-point? You could have the perfect product for their needs, but if your communication style doesn't match theirs, you could very well lose out on the sale.

Building strong relationships and understanding what customers value lays the foundation for how to go about building customer value: How should you approach communicating the solution? How should you configure your solution? How should you package and deliver your solution? It's an important part of the process – one that can make or break your success.

As there will be many considerations, spend as much time on it as is necessary; taking shortcuts and skimming over key customer detail will result in a failure to create and communicate value. Your ability, at this stage of the sales process, to 'put self aside' and focus on the customer is an attribute that separates high sales achievers from mediocre performers!

A few steps for communicating value that's relevant to the customer

As you solidify the relationship with the customer, build an understanding of their current situation, and assess their business problems and the solutions they need, the next challenge is to position your value proposition as the solution. To communicate your proposition, try the following technique from Solution Based Selling to build customer relationships:

  • make a promise of how your product or service will help the customer
  • state a fact that backs up that promise
  • communicate the commercial advantage or benefit to the buyer – this is a critical step because if you don't explicitly state a benefit, the customer will assume one; one that may be incorrect. To enhance your position, you need to direct the customer's thinking so that they can 'picture' how the solution relates to solving their business problem and satisfying their needs
  • communicate the personal value – whereas the benefit in the previous step is crafted around how your proposition is of value to the business, the personal value speaks more to the psychological benefit it brings to the person you're dealing with

As with every stage in the sales process, the relationship you cultivate will have a significant impact on how successfully you accomplish the process because all selling is built on developing relationships of trust and confidence! With an intimate understanding of what's important to customers, you are well positioned to create and communicate your value proposition. Without this understanding, you're flying blind and run the risk of being an unpaid entertainer.

Building value for customers requires close and constant attention

Done well, building customer value positions you with a great chance to win sales, and grow long term business relationships. However, because the sales process is both the same and different for each customer, salespeople must pay close and constant attention to a host of variables, including: the strength of their relationships with the various members of the customer's buying team, the customer's tolerance for change, the customer's current situation, asking the right questions, matching their communication style with the customer's, and so on.

With so many moving parts, salespeople may try to cut corners and make assumptions about the prospect and their situation. For example, if they've dealt with a similar customer in the past, they may assume that communicating the same solution will do. And while the new customer may well relate to that solution, its adequacy is unlikely to differentiate it from all of the other products on the market. Which is why it's so important for sales teams to get this right and illustrate why their value proposition is the best solution for the customer's requirements, one that is uniquely suited to meeting their needs.

Practical Sales Management and Leadership is a modular, cloud-based, training system designed to help sales leadership teams grow their ability to performance manage the sales force.  Preview a module from the training system here