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Think of your checking account. You make deposits to build up its value so that when you need it, you can make withdrawals. The goal of any bank account is to have enough in reserve to cover any withdrawal you need to make. We extended the same metaphor called “The Value Vault” to help salespeople quantify and calculate the value they bring in ways that are meaningful to prospects.
A Value Creator is the value a salesperson creates for his/her prospect. These Value Creators are like deposits that build the total value in the Value Vault. Value Killers are identified as the cost of a solution, the perceived risk of doing business, or a poor reputation. Value Killers are like withdrawals that decrease the balance in the Value Vault. To win a significant opportunity, the value in the Value Vault, at the very least, has to be positive.
Conceptually, salespeople know this to be true. If that is the case, then why are salespeople surprised when they lose a significant sale, or even when customers push back on price? Shouldn’t the salesperson be able to predict when they haven’t created enough value to win? Shouldn’t a salesperson know how to develop strategies or take actions to shift the balance of the Value Vault in their favor?
We tested the Value Vault concept with the national accounts division of a large shipping and logistics organization. The salespeople in this organization were constantly coming up against price objections. Initially, the team’s leadership felt the sales team needed help with negotiation skills. After some assessment, it was determined that the real problem wasn’t poor negotiation skills, but rather a failure to communicate the impact the company’s solutions could have into meaningful and measurable terms the customer would accept and appreciate. When we implemented the Value Vault tool, the sales team learned how to connect the benefits of their solutions to various line items on their client’s income statement and monetize the benefits in a way that was compelling to their customer. By demonstrating validated economic impact to key stakeholders inside their client organizations, price objections began to diminish. The impact for our customer was (1) increased average sale price; (2) increased margin; and (3) increased customer satisfaction. While we fully anticipated the first two outcomes mentioned above, the third outcome took us by surprise. After further investigation through customer interviews, we found that customer satisfaction increased because the customer now had a greater appreciation for how their shipping and logistics investments were impacting their bottom line. Rather than simply looking at shipping and logistics spend as a necessary cost item; their customers began to see this investment as something that brought a positive ROI to the business. In addition to eliminating many price objections, our customer found the Value Vault tool also helped their salespeople make more strategic decisions about how to approach sales opportunities, and in some instances, it helped them determine they needed to walk away from an opportunity altogether.
We are excited to introduce this essential sales tool at a free webinar later this month. Click here to know more.
This article is written by Kevin Jones and first appeared on LinkedIn.