I found myself in a conversation with a group of sales leaders one recent cold and windy Sydney morning. It was a pretty casual affair over hot creamy lattes and some pretty fantastic blueberry muffins. The discussion touched on a few high level sales challenges but we didn't really get into any depth. That is until we landed on the subject of value.
Being the leader of a sales realignment company that helps organisations to place customer value at the heart of everything they do, you’ll appreciate how highly tuned I am to this issue. To save time I’ll summarise the short but spirited debate by saying that although value was seen as being an important element of the sales process, if it got in the way of making a sale they would simply move on with the pursuit.
Sure, it was all well and good to have that lofty goal but sales people had to be busy selling. All that time searching for value, well let’s just say that deal isn't going to close itself!
Unfortunately I had another pressing engagement so didn't get the opportunity to challenge this thinking or to share our perspective on what value really means before I had to depart, so I left the discussion somewhat deflated yet still unwavering in my belief that like Jake and Elwood from The Blue Brothers movie we are “On a mission from God”. This whole experience got me thinking. If value is seen as being almost peripheral to the sales process, a kind of add on that’s nice to have but ultimately a luxury we can do without, what is it that you’re selling? Or to put it another way - What is it that your customer is buying?
Before we answer that lets discuss value for a moment.
Webster’s defines value as, “The property or aggregate properties of a thing that renders it useful or desirable.” An example of the difference between price and value would be the accountant who charges you $500 to do your tax returns but saves you $2,000, as compared to what you would've paid in taxes had you been doing the returns yourself. Add to this $2,000 the twenty hours of hair-pulling frustration she saves you, plus the added security of knowing it is done correctly. So while her fee (price) was $500, the value she provided was four times that fee in cash terms, and much more than that when you take the full experience into account. At the same time, while she charged you $500 for the work, it didn't cost her nearly that much to do the work, so she made a significant profit, too - which she should, given the value she provided.
In The Go-Giver book by our founder Bob Burg and his co-author John David Mann, one character explains this first principle to the main character, an up and coming but very frustrated young business man named Joe, by parsing the distinction between three restaurants of differing levels of quality:
“The bad restaurant tries to give just enough food and service, both in quantity and quality, to justify the money it takes from the customer. The good restaurant strives to give the most quantity and quality for the money it takes. But the great restaurant - ahh, the great restaurant strives to defy imagination! Its goal is to provide a higher quality of food and service than any amount of money could possibly pay for.”
The first restaurant may or may not survive, and the same goes for the second - but the third will survive and thrive.
This is the essence of the personal value proposition (or, in this case, the business’s value proposition, which most likely is a direct reflection of the restaurant owner’s personal value proposition). It is the trade secret of all exceptional businesses and the core element that lies at the heart of their success: providing more in value than they receive in payment.
As Bob and John write “The ability to provide exceptional value is not limited to only the highest-end businesses or those with luxury-level product lines. The ‘great restaurant’ in the example could be a high-end fine dining establishment, and it could just as easily be a simple grill and sandwich counter, local tavern or coffee shop serving fantastic muffins.
It is the driving force behind the stunning success of high-end Japanese car maker Lexus and no-frills US airline Southwest, both of whom have not only simply survived but thrived - in an era when their competitors are struggling to stay alive.”
Value is value - not price. And the consistent over delivery of value is the cornerstone for stratospheric success regardless of the scale of your business.
So, getting back to where we started. First we need to accept that in the eyes of our customer, value is the target we must always have our laser guided sights set on. If we accept that premise then how can it be viewed as an ‘optional extra’ that gets in the way of the sales process? Actually it is everything about the sale. As Bob Burg often says, nobody is going to buy from you because you have a quota to meet or even because you believe so much in your product or service that they absolutely should buy. They will buy only because they believe there is more value in having your product or service than in the price they pay to receive it.
Ian J Lowe is the CEO of Go-Givers Australia, a sales transformation, coaching and consulting organisation offering a unique culture-defining philosophy and framework that makes giving value the cornerstone of a refreshingly open and authentic approach to selling.
Image Credit: The Blue Brothers Movie, Universal Pictures 1980