“The aim of marketing is to know and understand the customer so well the product or service fits him and sells itself.” Peter F. Drucker
The first lesson of "Sales 101" is to know your customer. Mastering that principle will shorten your sales cycle and boost your close ratio - just ask a rainmaker.
That’s how you want people to describe your sales team. And who wouldn’t?
But, we measure sales success based on performance. And research reveals that many sales managers are disappointed by their team’s performance and sales numbers. According to data from CSO Insights’ 2014 Sales Compensation and Performance Management study, only 58.1% of salespeople made quota in 2014. The study showed a significant drop in both the percentage of reps making quota and company revenue achievement.
This can be especially frustrating when you’re responsible for helping your organization meet revenue targets.
The good news? It’s possible to learn from successful sales teams and use what you learn to improve your own team’s effectiveness.
Imagine making sales projections and then being able to hit those numbers. Sound impossible? It’s not. In fact, high-performing sales teams do this on a regular basis.
With a few changes, you can help your sales team do the same thing.
But before I jump into the details, let’s dig a little deeper into why so many sales teams are missing the mark.
What’s the Problem?
Before we can solve a problem, we need to be clear on exactly what’s happening and why.
So, why are so many sales teams falling short of their quotas?
Is it the economy? Lack of product knowledge? Bad leads?
There could be countless explanations but the chief reason is commoditization. When asked what barriers were impacting the effectiveness of their sales teams, sales management indicated they were having difficulty establishing competitive differentiation.
What does this mean to you?
In today’s marketplace, if customers can’t identify what makes you different from your competitors they’ll lump you all together in the same bucket. That means they’ll be comparing your prices to your lower cost competitors, even if your product or service is heads and shoulder better than the competition. After all, if your prospects can’t make a distinction then why should they pay more?
What this all boils down to is…
This May Be Causing You to Lose Out On Sales
Commoditization is a threat to every organization.
The reason? According to Miller Heiman, “customers and prospects no longer automatically see an individual company’s brand value.”
You may even be aware of this issue since 65% of sales leaders believe their sales reps lack the ability to correctly articulate the value proposition.
Even sales teams who are making their quota face this problem. Often, top performers may be picking up the slack for less effective sales reps. That is no good because you need every direct report to deliver as promised.
So what can you do?
You can defeat one of the most pressing challenges facing the modern salesperson by using time-tested sales best practices. That’s because, despite the changing landscape and increasingly complex sales cycle, the principles of sales success are timeless.
A Great Reminder for Sales Initiates and Veterans Alike
We live in changing times.
But guess what? Fundamental sales techniques are still the same.
World-class sales teams know this and take advantage of that knowledge day in and day out. They know that to make a sale, you must know your customer. You must understand their problems and provide solutions that help solve those problems.
Steve Andersen, President and Founder of PMI notes, "High performing sales teams discover how their customers define value and then engage and execute accordingly. They recognize that when their sales efforts are focused on the value expectations of the customer, the relationships that develop are deeper and more long-term." [7 PMI]
If you want to help your sales team differentiate from competitors and fight commoditization, you need to help them master their messaging. Sales reps must help customers understand exactly how your company can help them. In other words, your sales reps may need to get better at communicating your company’s USP.
Why? According to MHI Research Institute, “Value statements, which connect industry, role and business challenges or opportunities, set the context for customer engagement.” MHI also found that 92% of world-class sales performers have a formalized value proposition that is compelling to their prospects compared to 42% of other survey respondents.
So, what does a compelling value statement or USP look like? It may be helpful to look at some companies who have a strong USP.
Can your sales reps communicate what makes your company different and how that helps prospects?
If not, don’t panic. This issue can be addressed by training and coaching.
Here are two ways world class companies help their sales reps show value to prospects.
- Deliver value through people and processes—Deliver value before your prospect buys. One way to do this is by analyzing prospect needs by asking questions. Andersen says, “competitive positioning and differentiation occur more naturally during the sales process if the sales team first seeks to understand how the customer defines value. This means that before talking about products, solutions or services, the effective salesperson should build credibility by asking insightful questions, listening and capturing information, and then validating this with the customer.”
- Communicate value by refining your USP and using consistent messaging—Your prospects are assailed with sales messages all the time. That’s why most people have a filter to tune out useless information. So what are they tuned in to? Remember WIIFM? It stands for “What’s In It For Me?”, a question on your prospects’ minds. So while your prospects may tune out sales messages, when they hear information that’s relevant to their situation (the station WII-FM) they take note. Customers need a compelling reason listen to you. If you want to provide that reason, you need your sales reps to talk about solutions to prospect problems. That means crafting an easily understood USP that states the benefits of your service from a customer perspective. All your sales reps and marketing collateral should share the same message.
You probably have some sales reps that are making or exceeding their sales numbers. Find out exactly what they are saying to prospects that works. Use this to coach other sales reps and increase sales effectiveness across your team.
What are you doing to help your sales team understand your customer? Leave a comment and share your secret!
Image Credit: https://www.youtube.com/watch?v=kblV--h7vEU