Trying to develop a sales strategy to accelerate your company’s growth? Easier said than done. Many sales methodologies have been developed over the decades, but you have to choose which one is right from you and your team. For example Value Based-Selling, Solution based Sales, or Challenger Sales, just to name a few of the most important ones. But what distinguishes a good strategy?
In sales there are many factors which decide about the success or failure. And because of this is it important to use a suitable strategy, which fits the customer.
A good sales strategy is a planned, long-term sales plan that is closely coordinated with marketing.
Which method is best suited to achieve your goals depends not only on your personality, but also on the complexity of your product, your target industry and, most importantly, your customer. In the following article I would therefore like to present five of the most promising sales strategies that can significantly enhance your sales ability.
1. Value-Based Selling: Demonstrating the product value with the customer example
As the name implies, this sales method is based on the value your customer experiences with the use of your product. At the beginning of the relationship, the salesperson collects as much information about the customer as possible. It is important to take a close look at the customer’s business model in advance and drill deep into the details of everything they say.
Even two seemingly identical companies operating in the same industry may have developed completely different strategies on how to address and solve their problems. This often results in different pricing models, sales models and cost structures. If you have identified at least one challenge or pain in the product or company that you can help to solve, you have a strong reason to talk to the prospect.
This sales approach is particularly exciting if you sell a highly customizable product. Then it is possible to adapt it exactly to the needs of the customer. Such products are often accompanied by comparatively high price models. That’s why the sales employee should pay particular attention to really understanding the customer’s needs in value-based selling.
This helps the salesperson in advanced discussions, even during price negotiations. At the end of the process, the product price is in turn compared with the value delivered to the customer. The higher this value is and the more clearly it is presented, the better the price negotiations will go and the more likely it is that a contract will be signed.
2. The Power-Base Principle: Industry knowledge is king
The next sales strategy highlighted here is the power base principle. Here, the sales employee assumes an expert or consultant role. He is then in a particularly strong position, namely in the “power base”. The prerequisite for this is, of course, that the salesperson has enough experience or expertise in the respective field.
Prospects buy from salespeople they trust so nothing is worse than being thought of as untrustworthy by the prospect. Authenticity stands above all else with this method. With the power base principle, the salesperson knows the customer’s target market better than the customer themselves. Being able to hold technically and professionally in-depth discussions, the salesperson brings in their expertise and then develops a business strategy together with the customer.
The close contact between decision-maker and “consultant” also helps the salesperson to stay ahead of the game in follow-up projects. The higher the complexity of the product or service and the complexity of the customer target market, the more effective the power base principle is.
3. SPIN Selling: By asking questions about emotional attachment
This method of direct selling puts a heavy focus on the questioning of the customer. The aim of this sales strategy is to build up the most emotional bond with the dialogue partner in order to set the exit hurdle from the sales process as high as possible.
SPIN distinguishes between four question types:
Situational questions, in order to get to know the general conditions and situation of the customer.
Problem questions to identify concrete challenges and pains of the customer to understand how to place the solution to be the most applicable solution.
Implication questions, which are used to identify or create the biggest problem in order to present oneself later as a contact person for problem solving.
Need-payoff questions to determine the value to the customer that the problem solution would create.
In a sense, SPIN Selling is the predecessor of Solution Selling. In Solution Selling, the gaining of information is further deepened by asking specific questions. Since Solution Selling extends the SPIN approach, I recommend that you no longer apply SPIN Selling separately but embed it in your Solution Selling.
4. Solution Selling: Solving problems instead of just selling
One sales strategy that is currently highly regarded is solution selling. More and more companies are move away from pure product sales and towards solution selling. The reason for this is very simple: Customers are becoming more demanding and can usually find out about the mere product information and price themselves via the Internet. If the added value or unique selling proposition is not sufficiently clear, there is a risk that the potential customer will decide on the basis of price alone.
It is therefore not only important for the sales representative to present the advantages of his product. Rather, they are required to deal with the business challenges of their potential customer, similar to value-based selling. As a rule, the salesperson and customer first work out the existing challenges and develop potential solutions in a workshop-like discussion.
In solution selling, the seller offers the potential customer significantly more than just providing a product. Often the presentation consists of planning, consulting, recommendations for use and regular training. The result is a complete package for the customer whose added value goes far beyond that of the actual product.
Solution selling is often used for products that are sold in both the high-price and low-price segments. This is one of the reasons why solution selling usually includes a return-on-investment or amortization calculation. It is important here that the figures on which the cost calculation is based come directly from the customer. Only in this way can the seller create trust. In the end, the customer decides not only for the product, but for the overall performance presented by the salesperson.
5. Challenger Selling: Luring the customer out of the reserve
The challenger selling method is the most modern and most popular sales strategy among salespeople at the moment. This is because the method developed by CEB Global is based on scientifically collected data from over 1000 sales managers from various industries and is essentially based on the Solution Selling Method, which is already highly regarded among sales people.
Unlike Solution Selling, however, the “Challenger” places less emphasis on reaching a consensus than the Solution Seller. With Challenger Selling, the seller is more interested in opening up a new business approach for the potential customer. He challenges the customer’s business model, so to speak.
The challenger sale focuses on effective questioning on how the customer is currently doing business today and then understanding the challenges and pains that come along with it. Once that is complete the sales person then proposes an applicable alternative that will enhance and add additional value to the existing methodology. This strategy is built around creating a moment where you challenge the customer preconceived notions and truly teach them something new.
This method is particularly successful when the own product offers innovative advantages that were simply not possible up to now. Examples are technologies such as mobile telephones, the Internet and artificial intelligence. If the sales employee succeeds in creating an aha effect with the customer without questioning the customer’s best practices too much, he has already taken a big step towards signing a contract. The business partner has learnt something new and already knows the necessary tool to apply what he has learnt – your product.
Which distribution strategy you ultimately decide on depends strongly on your personality, the target industry and the complexity of your product. Here all strategies at a glance:
Value-based selling is particularly suitable for modular or highly customizable products. Here it is important to understand the needs of the customer in order to adapt the product to these needs.
The power-base principle is based on the high level of expertise of the seller and gives them a strong negotiating position. It is suitable for highly complex products.
SPIN Selling convinces through the questioning technique and can be used with Solution Selling. Because this sales technique is about learning as much as possible about the customer in order to sell him not only a product but a complete package.
Challenger Selling is particularly useful when the industry is facing a multitude of changes. Then the customer’s business model can be challenged and innovative products can be placed.