Tags: Selling and Sales
Submitted by: Curtis DeCora, Superior Marketing
WHAT IS THE VALUE GAP?
Here, at Superior Marketing, we identify the value gap as the distance between the prospect, client or customer’s understanding of a product, service or solution, in comparison to the sales professionals knowledge of a product service or solution.
It is truly focusing on the value of Point A and value of Point B, while utilizing a process to take the prospect, client or customer from A to B, keeping buyer and seller on level footing.
LAST SALES CONVERSATION
Let's look at your last sales conversation or discovery call. How did that go? What kind of questions did the prospect ask, and how did you handle those?
If it didn't close, it was likely due to the VALUE GAP. Let me explain. I call this a value gap simply because there was a gap between what they wanted and what they needed as it compares to what they know. Prospects want to buy, but most do not want to be sold. There are five (5) primary reasons people buy, and how we can leverage those to help facilitate buying decisions.
Let's explore them.
5 REASONS WHY PEOPLE BUY
People buy because the money is right. They look at two aspects of money; (a) how to increase their revenues, and (b) how to save money. Those are money topics you should address. There are a very small percentage of people who legitimately don't have the money to buy. So, I don’t personally buy this. However, the focus of “Money” can be accomplished by quantifying the challenge. Let’s say a business owners experiences an ongoing challenge causing “leaky bucket syndrome” whereas money is leaking out of their profitability. Now, let’s take it a step further and quantify this challenge to the tune of $11,000 per month, now this may come in the form of payroll, payroll liabilities, insurance, lost revenues, advertising, extended hours of operation, and so on. All of this can easily add up to $11,000 per month. Now, when coming back with a solution in the form of a product or service which costs $1,500 per month, that’s a 733% return-on-investment. If needed, ask them which part of their expenditures provide them with a 733% ROI.
Some people say they don't have time. I don't buy that either. If I could save you money, you'll make the time. If I can show you how to make more money, you'll make the time. So, I don't believe the fact that prospects don't have time. Our job is to show them why they should make the time. When someone doesn’t have time to meet with you, they’re not seeing the interest in your value proposition or your story sounds like the thousands of others reaching out to them. Your story should be very clear, and value proposition should be unique, and time should be precise in terms of presentation. As an example, you help companies increase their sales 21%, you help companies reduce expenses 18%, or even help increase employee productivity by 29% - you can and should know your data, so you can leverage that in your value proposition and big claim. “If you could show you 2-3 ways to increase your productivity 29% in just a short 20 minute discussion, when is a good day to stop by?”
Yes, you can save them money and you can help them generate more money. However, your solution costs money - do they NEED it? Some prospects know they need this, and some don't know they need your solution. Just because they know they need it, do they need it right now? This comes back to latent need versus active need. In meeting clients with active needs, they know what they want, how much they can spend, and how soon they need it. In most cases, they will pay the additional emergency fees, expedited shipping fees, or even a higher price tag for current inventory versus waiting the 2-3 days for the new shipment to come in. However, on the other hand, you have a latent need. A latent need would be something like Life Insurance. Whereas, we all know we need some form of life insurance, but isn’t high on our priority list. Before we know it, we’re 50 years old and our premiums have now doubled and insurer pools have shrunk for your type of insurance needs.
Just because they need it, doesn't mean they'll buy it. The next phase it establishing urgency. Our job is to establish a sense of urgency of why they need to take action now. In other words, if they don't take action they won't save money. If they don't take action now, they won't make as much money. There are two sides; Pain and Gain. You have to sell both sides; Pain and Gain. The third side is productivity, as we may already know, there are employees in every organization which aren’t revenue producing - they’re support. However, we can quantify their productivity and that impact on our bottom line.
The last part is trust. You have to establish trust. If they don't buy from you, they simply don't trust you. You may have great claims and case studies, your reviews are in abundance, but you haven’t addressed their needs and questions head on. How do you develop more credibility in your presentation? Use case studies, pitch decks, presentations, demonstrations, and so on using the exact queries and questions they may ask or seek. I recently read a post in the Facebook Group, “Sales Talk by Sales Pros” someone published a post which states, “People who want proof are typically in the habit of making bad decisions.” I would wager a guess this person has a problem closing deals, and needs an external source to place blame. Instead of looking inward on why people aren’t saying YES and making buying decisions, they tend to look at the prospect, economy, product, competition to place blame for poorly conducted sales processes.
LET’S GO ONE STEP FURTHER
Let's take this a step further. Have you been in a presentation where you're speaking technical aspects and the prospect doesn't fully understand the industry, product, service or solution? I’m not talking about tech-speak, or granular details of how or what, but a holistic understanding of why this is a viable solution to meet the demands of their business.
This is called a VALUE GAP.
HOW TO FILL THE VALUE GAP
Your job is to close that value gap. One simple technique I use is to ask them what they know.
Let me explain.
"Mr. Prospect, can you tell me what you know about XYZ?"
1. Ask The Prospect
Ask the prospect simple questions like, "Mr or Mrs Prospect, what do you know about (product, service, solution or industry)? Can you explain to me what you know from your research and networking?
2. Shut Up
This is your time to shut up and let them explain to you what they know. You should allow them to speak and explain to you what they know about your solution. They may give you surface level information on the product, service, solution and industry.
3. Fill the Gap
This is your time to offer insights. As a sales professional, your job is to fill the gap with valuable information. This is 10000% about educating the prospect on how it all works. You want to share information with them.
4. Tell a Story
Now is the time to shine! Tell a story of a current or former client that is using your solution, had a specific scenario that is (1) Real, (2) Reliable, and (3) Relevant to their scenario and current challenges. This step does a couple of things. First, it nudges the prospect forward because you have a story that educates them on the solution you're pitching and it completely relates to their current situation, scenario and challenges, while you address those challenges and have experience in solving their problems - you're building value.
This is a step that most sales people miss. They don't prequalify properly. Use this particular step in the sequence to prequalify your prospect. Here is an example: "Mr Prospect, just to be sure we're a good fit for you, and you're a good fit for us - let me ask you..." Ask you set of prequalifying questions, and make sure you score them. Yes, score them. I like to ask 5 questions. I give the prospect 2 points per question. I award points for (1) Need and (2) Urgency. My 5 questions help me clarify whether they need my solution and if they need it now. At the end of the 5 questions, I have a score for them. If it doesn't meet my scoring criteria - I'll let them now. "Mr. Prospect, while I agree you have a specific challenge with (insert challenge), although, you appear to be fit/unfit, for our company.
This is the step where you pre-sell the prospect on the solution. You want to make sure you have all lights GREEN. You'll be asking questions that walk them through the process, and are meeting all of your criteria. You should be now in the stage of pre-selling. "Great! That is what the (Solution) is all about. It is an exclusive solution, you’ll get one-on-one sessions with our lead consultant, login credentials to the members-only website which is loaded with training materials from industry professionals. Is there anything I have stated you object to?" This is simply a sequence of questions to allow them to object to what isn't acceptable. You can return to presentation if needed.
This is where you close the deal, and shut down the engagement. "Mr. Prospect, based on all of the information I have found here today, you're a good fit for us, and you have agreed this is something you need. Let me recap, briefly, what you'll be receiving (go into your recap). We have found you savings opportunities as well as new revenue opportunities, on top of that, we have showed you 2-3 ways to increase your efficiency. Based on this information, I'll be asking for a commitment from you. Does that sound fair.
Yes - Close the deal
No - Revisit objection strategies (you should have 3 objection strategies, minimum)
This is a sequence my team uses to close the value gap. Instead of using a Product Knowledge dump to share information, ask questions, and determine where the prospect is in the Buying Cycle, so you can match it to your Sales Cycle.
"When value exceeds price, people buy" - Grant Cardone
In conclusion, that was a ton of information, content and technical language. However, the point has been made clear. When we identify the 5 reason why people buy, which can also be the 5 reasons why people don't’ buy - then we can truly get a clearer picture of the value gap. In some cases, the value gap is extremely wide, and you would require more information, evaluation and assessment of their current situation. Don’t be like the guy on Facebook and demonize those who need more information to close the value gap, focus on how to bring them closer to you, closer to agreement, through the development of trust and credibility.