A winning B2B sales value proposition tells a story about a real problem – and puts real monetary value on the solution. The best way to create the kind of value proposition your prospect is looking for is by addressing a need.
Let’s talk about what value is – and what value isn’t. In B2B sales, value is the financial benefit you get from a solution beyond the price you pay for it.
For example, if you’re evaluating a solution that costs $30,000, and you expect to get $300,000 in incremental revenue – the value that you receive is $270,000. ($300,000 minus $30,000).
This is an important principle to understand when you’re selling or doing a demo with a prospective buyer: They’re going to be evaluating a number of different providers in the process, and they’re going to be providing a number of different value stories.
The more clearly you can communicate the financial reward that they’ll receive in excess of the price they will pay, the more effectively you can communicate the value.
How to Not Talk About Value
There are a lot of misconceptions about what “value” is. It’s often is described as “more features for less money.” The problem with this definition is that the value you receive from a solution isn’t about what you put into a purchase. It’s what you get out of it. Value is a financial benefit.
We often have this misunderstanding of what value really is, because of the way that it’s talked about. People often discuss value in a “grocery store value” sense; getting more “stuff” for less money. That’s not value. And that’s not what your prospect is looking for. Your product might offer a dozen more features than your competitor’s product does – but if it delivers a smaller financial return, is it really more valuable?
Step 1: Define the problem.
Now that we’ve defined what value is — and isn’t — let’s talk about how to communicate value effectively.
The first principle in our B2B sales value communication framework is defining the problem. This is one of the most important, and often overlooked, steps in communicating value. People often skip right to the second step, which we’ll talk about in a minute, but establishing the problem is the very first step when communicating with your buyer.
There are two parts to establishing the problem. The first is making the problem real and vivid in the prospect’s mind. The second is tying a financial cost to the problem.
Let’s take a very poor example of communicating a problem: “Joe, your sales reps are spending too much time researching their prospects.” To which Joe might reply, “Oh, I didn’t know that.”
Here’s a better way of communicating a problem: “Joe, have you ever walked the sales floor and noticed that it’s just dead quiet?”
There’s nothing more frustrating as a sales leader than seeing that none of your sales reps are on the phone. You walk out onto the sales floor, and it looks like your reps are busy. They’re pushing buttons on their computers. They’re typing. Bouncing from website to website, from their email to news sites, trying to learn a little bit about their prospects before they call them.
“They spend all of this time in prospect research, just to spend a few, short minutes on the phone. This should be a scary proposition for you, Joe, because every minute they spend in research is a minute that they’re not spending on the phone.”
If you think about how much you’re paying these sales reps – typically, between $60,000 and $80,000 just in base salary a year — that’s $15,000 to $20,000 if they’re spending two hours a day conducting research. You’re paying that amount for the research that they’re conducting. This is a very real problem that has very real costs tied to it.
See how the above example brought the prospect’s problem to life, and then — once the prospect was able to visualize their problem — communicated specific financial value?
Step 2: Show the benefit of the solution.
Now that you’ve painted a clear picture of the problem, it’s time to discuss the solution. More often than not, sales reps sell solutions by focusing on features.
This makes sense in theory, as features are the aspects of a product that deliver value. Features are the specific things you get when you purchase a product. A feature might be “We have dual plugs!” Here’s the problem: what the heck is a dual plug? And what benefit does it actually provide?
Sales teams need to spend more time focused on benefits, which you can think of as the “So what?” of the features, you love to talk about. For example: say your sales intelligence platform offers the most accurate direct dials on the market — that’s a feature.
Let’s talk about that feature by instead focusing on its benefits. Access to direct dials means the user will spend less time dealing with gatekeepers and navigating corporate switchboards. This means they’ll make up to three times as many connections in an hour of prospecting than they’re currently making.
Talking about features keeps the conversation focused on your product, not the prospect. When you talk about benefits, you show the prospect exactly what they’ll get out of the product.
Step 3: Articulate your value.
The next step after communicating the problem, and the benefits of your solution, is to finally articulate value. And there are two parts to that.
The first part of communicating the value is the value driver. You have to communicate and understand what’s driving the value for the deal.
Take the previous example, where we discussed the benefits of direct dials for sales professionals. Let’s take that a step further and introduce the value driver. If you spend more time talking to prospects in a given hour, you’re going to book more meetings. If every sales rep at your organization booked just one more meeting per week, that would result in, let’s say, 50 more meetings per year. With 50 more meetings per year, on average, 10% of them are going to become closed deals. That’s five more wins per year, and that’s on the low end. That’s a value prop.
The second piece of it is the actual monetary value, or the ROI (return on investment). If you know that five more deals are going to close because of the meetings that you book, then you know, based on their average deal size, what that final number is going to look like. Make sure to associate some kind of dollar figure with those extra wins. Maybe it’s $100,000 per rep. Put a number on it!
Step 4: Bring it all together with a story.
The story brings the sales value proposition altogether. But it’s not just any story. It’s a story that incorporates these three points: the problem, the solution, and the value. The most effective way to tell a value story is to tell a true one: that is, the story of one of your real-life customers.
Case studies make great customer stories. Develop stories that include a situation (pain point), action (purchase of your product), and result (ROI) – and include these in your sales collateral. Develop several case studies, one for each industry or line of business you sell into.
“… Now that’s the kind of result that I know, you, Mr. Prospect, will see from our solution!”
Price is Not Part of the B2B Sales Value Proposition
If you find yourself competing on price, then you failed to effectively articulate value.
That’s not to say price isn’t important; every prospect wants to know how much they need to pay. But if you effectively communicate value with the aforementioned steps, your prospect will see beyond the simple dollar amount you’re asking for. And, there won’t be a discussion about why your premium price is too expensive — because the customer will understand why it’s worth it.
To learn more about how ZoomInfo can dramatically scale and improve all aspects of your go-to-market strategy, contact our sales team today. We offer the most intelligent B2B contact database on the market.