B2B (Business-to-Business) entrepreneurs are always excited about their product. You can see it in their actions and hear it in their voices. And well they should be – after all they have invested a lot of time, effort, and funds.
Unfortunately, the seller’s excitement alone will not translate to success. B2B customers want a product that can make a difference in their business. It is all about value creation.
Companies measure the value they will get from any purchase against the total product cost. Total cost is comprised of the price of the product plus the company’s costs of using the product – like integrating it with other systems or training staff. The person on the buying side of the table will develop that total cost picture.
On the other side of the table, you as the seller must develop a clear, comprehensive understanding of your product’s value to the buyer. Understanding the potential value doesn’t come from a product pitch. Let’s examine what that sales conversation might look like.
What kind of value might your product provide to a prospective B2B customer?
Photo of Janet Spirer, Ph.D.
Value usually falls into two buckets: increasing revenue or gaining operating efficiencies.
In the revenue bucket, perhaps your product can help by adding to their portfolio because your product is a natural fit as an add-on for existing or new customers. Or maybe your product will allow them to sell current products into new geographies.
Looking at the other bucket, value can be realized through gaining operating efficiencies, such as reducing operating costs, shortening order times, or improving customer service.
How do you sell value to a B2B customer?
Begin by understanding your customer’s problems and their successes. Entrepreneurs must understand their customers’ problems to illustrate how their products can help increase revenue or gain operating efficiencies. So, start by learning all you can about a customer before you ever meet them. Articles, websites, social media, and presentations are great sources. If companies are publicly held, 10-Ks, annual reports, and other government filings can provide a wealth of background.
Then when you meet with potential buyers, you already have a basic understanding of their business and some initial thoughts about how your product might bring them value.
This is where most of your competitors will stop. But you can differentiate yourself by also learning about the customer’s successes. If you understand your customer’s successes, you can determine how your product can help them to continue and expand upon that success. You can position your product in a way that it stands apart from your competitors who only know half of your prospective customer’s story.
Do you know about your customer’s future?
An additional key to selling value is to ask questions about the customer’s future direction. Unfortunately, most people focus their questions just on the status quo – the issues and problems the customer is facing right now.
Fair enough. Understanding the status quo enables an entrepreneur to present a viable value proposition to the customer that is valid today. The bad news is that simply adopting a status quo perspective means you will likely look and sound just like everybody else.
So how do you differentiate yourself from your competition? Successful entrepreneurs move to the next level. They develop a picture of the customer’s future and illustrate how their product can assist in achieving those plans. Here are some questions you might start with:
- What operational or product changes will you be making over the coming years to grow your customer base?
- Which of your competitive advantages will be most difficult to maintain as the future unfolds?
- Do you expect some new competitors to be entering the market in the foreseeable future?
Have you considered the notion of value migration?
Photo of Richard Ruff, Ph.D.
What constitutes value shifts over time. Whether you analyze it from the perspective of the individual buyer, company, or an entire industry, expectations about value tend to be dynamic.
History is rich with examples of companies that had viable value propositions but failed to accurately judge the shift in the market. Just think Blackberry, MySpace, Google Glass, and Apple’s Lisa to name a few.
For entrepreneurs, once a company purchases your product, this isn’t the end of the sales process. Your product’s value to the company can shift over time. Continuing to show your customers how your product provides them value is critical to maintaining your product’s position with that company and growing sales.
A final thought for your path ahead
If you are going to build a successful company, getting great at selling value is a must do for B2B entrepreneurs. But being great requires more than asking a few questions and developing a good product. It requires more than just crafting a slick presentation. You need to plan and execute sales interactions at a level that your competition hasn’t even thought about doing. Selling the unique value of doing business with you now and in the future is an important ingredient for achieving sales success.
Is learning new things, for yourself and your business, a key goal for 2024? Find support to make your ideas a reality for any entrepreneurial stage with the Training and Development Resources (TDR). TDR is a free, on-demand digital learning tool for people like you.
About the Authors:
Richard Ruff, Ph.D., and Janet Spirer, Ph.D. co-founded Sales Momentum, LLC, providing custom sales training to Fortune 1000 companies worldwide to optimize revenue. Subsequently, Richard co-founded Level Five Selling, LLC, a sales coaching system to master sales coaching and sales call execution skills. Previously, Richard spent 20 years as Vice President of Huthwaite, Inc., and Janet retired as a Professor Emeritus from the Marymount University School of Business after 18 years. Today they reside at Mirabella at ASU.
