Here's the big question when it comes to establishing value: How can you create a mix from these six value areas to create a "total package" - a new mixture that uniquely appeals to your contact, and instantly differentiates you from any other option he or she may be looking at?
Each person with whom you deal will place a different level of importance to each of these six elements. The "magic" lies in learning which element is of greatest importance to a given prospect or customer -- which of your strengths you should emphasize or de-emphasize. To position yourself as a resource, you'll need to develop the right combination of appeals, the combination that will convey the greatest level of overall value.
Your challenge is to learn what areas of value the other person will benefit from as he or she seeks to accomplish critical objectives. You must then focus in with intensity on your company's (and your own) strengths in each of the appropriate value areas, and send the message that you can emerge as a resource by: increasing profits, increasing productivity, reducing costs and/ or increasing competitive advantage.
So: How can you deliver on one or more of those objectives? Let's look at each of the six value areas in a little more detail now, with an eye toward helping you deliver a better value proposition than your (less-informed!) competition.
This value area has to do with the organizational and industry expertise you can bring to bear in helping people address critical problems. It's important to ask yourself: How much organizational knowledge do you bring to the table when you meet with a customer? I'm not talking just about what you know, but what everyone in your organization knows.
It sounds strange, but it's true: We salespeople often give our customers too much credit. We assume they are deeply educated in their industries, and we underestimate the importance of own organizations in bringing critical industry information to the customer's attention. Your customers want solutions to their problems -- and that means they're looking for information, not just invoices.
So do what Titans do? Stop fixating on products and services! Make a list of all the intellectual resources your organization offers. Find ways you can offer value to selected customers by supplying non-confidential information. Consider, for instance, the newsletter.
Newsletters, bulletins and updates help enhance your image as an expert. People seek out experts; they like to buy from the authorities. Just by sending out valuable information, you position yourself as an authority. For existing clients, the newsletter becomes a value-added service they get just from doing business with you. For key prospects, newsletters are further evidence that they ought to be doing business with you!
You can also establish value in the information area by passing along key referrals. Suppose a customer mentions that he's got a problem in an area your company doesn't handle -- but you know that the problem has been addressed successfully by another customer of yours, who works in a different industry. Pass along the person's telephone number! When you have the facts someone needs, you are no longer considered "just a salesperson". You are a resource!
This value area has to do with the way you ship your products and deliver your services. Many of the people you deal with will be eager to hear how you can help them get products delivered against a tight deadline, ship items for less money than someone else would charge, or attain both objectives. Accordingly, you need to know what kinds of strengths your organization will bring to the relationship when it comes to distribution.
Helping your customers beat their competitors to the punch is a great way to help them to attain a competitive advantage. Reducing the costs associated with shipping fees can be an important part of improving profitability or reducing expenditures. Lowering shipping costs for a customer may be as simple as consolidating multiple shipments for maximum cost efficiency.
Look at order verification and tracking as part of the distribution value offering, too. Do you provide instant updates on where a particular order stands in terms of delivery? Customers need up-to-date information to make the best decisions. If you inconvenience them without the good information they need to make plans, you will quickly become an "unfriendly" supplier!
The next value area has to do with systems -- the information tools you already have in place within your organization, and that you may be able to be put to use on a given customer's behalf.
Your organization probably already has an information management system of some kind. How can it be better put to use for select prospects and customers? Identify your strengths as an information resource so that you can present it at the appropriate point in time. What do you offer that a competitor doesn't?
A good example of adding value in this area is Electronic Data Interchange (EDI). Manufacturers use this to monitor inventory levels at customer warehouse sites to streamline operations and automatically trigger re-order requests. Electronic ordering also reduces the time and expense associated with creating manual purchase orders. Nowadays, banks use such systems to add value by allowing consumers to pay bills electronically (thereby reducing costs and increasing productivity). Some brokerage firms (such as Charles Schwab) now offer their customers on-line trading, and charge less per trade on-line than they do for phone transactions.
Another important value area is your stabilities. How strong is your organization? How well capitalized is it? How long have you been in business? How certain is a customer or prospect likely to be that you'll be in business one year, two years, or three years from today? Is the same person who was answering technical questions six months ago answering technical questions today? Do you have a low rate of turnover in your company? Is your company's research and development department better funded than that of the competition? Can you deliver greater value through reduced costs or superior service over an extended period of time? These are all areas where you may be able to differentiate yourself from competitors who are less likely than you are to withstand radical changes within their industries of operation.
Product Or Service Design
This value area has to do with quality, features/functions and reliability issues. If what you offer is better made, breaks down less frequently, entails less down time, or is generally more reliable than that which the competition offers, then you stand a very good chance of helping prospects and customers who must attain relevant goals related to increasing productivity or reducing costs.
It's in your best interest, then, to know how your product or service stacks up against that which the competition offers those customers.
Assets For Key Customers
Sometimes, special customers get special treatment. This value area has to do with such assets as a large research and development department that can develop customized enhancements, or very deep technical support on certain products or services. Can you think of times you were able to deliver unusual or exceptional levels of service that helped a customer boost productivity, reduce costs, or attain a competitive edge? In what areas can you "move heaven and earth" for an important prospect or customer?
Remember the old 80-20 rule: 20% of your customers will provide you with 80% of your business. While all customers are important and do deserve your time and attention, your biggest customers expect, and should receive, a differentiated level of service. They want to be rewarded for the amount of business they bring you. They should receive it!
It will costs you far less to capture additional business from existing accounts than it will to build up equivalent levels of business from new accounts.
Delivering Value Through Differentiation
So -- those are the six areas where you can deliver value. At the end of the day, Titan salespeople build relationships by building up the value that customers and prospects demand in these particular areas. True differentiation from the competition occurs when you respond to a given customer's perception of value by being the best fit for what they need and how they want it.
Please note: By providing custom-fit products and services, you are not necessarily changing your products and services. In most cases, the only thing you have to change is the emphasis you put on the mix you are offering. Some customers demand electronic ordering, while others are more interested in receiving free product updates. Find out what is important to your customer, and then customize the mix in your presentation that makes sense for that customer. Don't offer the same mix to every prospect or customer!
Identify The Value
Before you go on to something else, please take pen and paper in hand and write down at least three examples of value you and/or your organization offer in each of the six categories you've read about in this article. Ready? Go!
© 1999 by Karr Associates, Inc.
This article is excerpted from Karr's Titan Principle™- The Number One Secret to Sales Success. Ron Karr is a professional speaker, consultant, trainer and author who specializes in helping organizations to dominate their marketplace and assisting individuals to get closer to the people they serve. Call 800-423-5277, fax 201- 461-5621, or visit Ron's website, http://www.ronkarr.com, for more information (including his books, The Titan Principle™- The Number One Secret to Sales Success and The Complete Idiot's Guide to Great Customer Service.)