If you are in business, sales, or have ever sold anything then you’ve came across this question. “What’s the PRI$E of it?” The price could have been an issue, the issue, or no issue at all for the transaction to occur. Its common knowledge that before anything is purchased in today’s market consumers have researched and reviewed prior to the transaction evening having the opportunity to occur.
How do we gain an edge? What we have to focus on as business owners or sales professionals, and it is something I believe every business should be focusing on, is how we can bring added value to the table for our goods, services, or products.
Value-added selling describes the enhancement a company provides its product or service to their customers. Practicing value-added selling allows for companies to discover how to enhance, augment, or enlarge their offer for their customer. It’s a philosophy, not just a catchphrase. It’s everything you present before price is thought about. Bringing added value on the front end elevates the price issue on the back end.
Getting the vale-added selling philosophy on the inside of you will positively affect your business and sales. However, to prevent it from just being a catchphrase you have to first see where your selling philosophy is currently. Once you figure out where you are then you can plot a path to get where you want to be!
Which of the following are you?
- Equalizers – You are worried about how you compare to the competition
- Differentiators – You aren’t comparing yourself to the competition, but you are trying to lead the pack in innovation and creativity compared to those in your industry.
- Value-Added Peak Competitors – They stay on the forefront the “new-frontier” because they are doing what’s best for the customer and their customer’s ever evolving needs.
Still as you move closer to becoming customer focused and dialed into Value-Added selling that price is still going to come up no matter how much “added-value” you bring to the table. I would say that is your prerogative and not the buyers’. When customers were asked, “When you make a buying decision, how much of that decision is weighted on the product, the company, and the sales person,” this is what the numbers showed.
- 57% of the buying decision was influenced by the product
- 25% of the buying decision was influenced by the salesperson
- 18% of the buying decision was influenced by the company
If that’s the case what intangibles should we focus on while in our “selling” mode? What are our buyers focused on and hold higher in order of value? I’m glad you asked….. Listed below are the characteristics that buyers look for in the people and companies they purchase from.
- Customer Focused
- Good communicators
If you still not convinced that buyers aren’t always price focused check these stats out!
- 1 in 6 buyers are focused on price only
- 1 in 6 buyers are focused on value
What does that mean? That leaves 83% of the buyers not just focusing on price to make a purchase decision. Most buyers you are selling to are open to value-added arguments on why your goods and services are their best option. On top of that, those same buyers are willing to pay 11.4% more for better quality and 9.9% more for better service, so why not increase your margins through value-added selling.
Buyer’s Top 12 – Order of Importance
- Quality and Performance
- Customer Service
- Knowledgeable Salespeople
- Product Availability
- Supplier stands behind what it sells
- Supplier’s ease of doing business
- Salesperson follow-through on promises
- Trustworthiness of the salesperson
- Product Durability
- Salesperson Accessibility
- Acquisition Price (Price is #11)
- Technical Support
If after everything else you are still focused on price consider the following as I bring this post to a close. “Are you cutting your prices, or are you cutting your throat?” Cutting prices can be interpreted as an admission that your prices were too high all along and you’ve been gouging your customers. Also, it sets a dangerous precedent. You’re telling buyers that lower prices are possible. Lastly, cutting prices give the impression that your company, personnel, and products are not as good as the competition.