Engineering Value in the Sales Cycle Featuring Analyst SiriusDecisions
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Customers want to work with vendors that understand their unique problems. They want solutions and value from their partnerships, and look to a good solution provider that can deliver this value from start to finish. Yet, all too often sales reps fail to discover what is important to each stakeholder, resulting in deep discounting or no-decisions. This webinar with SiriusDecisions’ Jim Ninivaggi, will explore practical ways to identify key stakeholders and business drivers, and will illustrate ways to map the value of your solutions to build trust with your clients throughout the sales cycle.
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Engineering Value in the Sales Cycle Featuring Analyst SiriusDecisions
- 1. COPYRIGHT © REVEGY, INC. // PROPRIETARY AND CONFIDENTIAL Engineering Value In the Sales Cycle WEBINAR featuring Jim Ninivaggi Service Director, SiriusDecisions Tim Braman VP, Revegy
- 2. © 2014 SiriusDecisions. All Rights Reserved 2 You Win Some. You Luge Some. To have velocity at the finish… … you need to build it from the start.
- 3. SiriusPerspective: If you have not engineered value throughout the sales process, you will be forced to sell on price at the end. Maybe It’s Not A Problem Closing My reps need closing skills
- 4. © 2014 SiriusDecisions. All Rights Reserved 4 Why to sell value P&L Reduce Sales Expense 5% Increase Sales Volume 5% Decrease Discount 5% Sales 100.0 100.0 105.0 105.0 Cost of Goods 60.0 60.0 63.0 60.0 Gross Profit 40.0 40.0 42.0 45.0 Fixed Costs 13.0 13.0 13.0 13.0 General & Admin. 11.0 11.0 11.0 11.0 Sales Expenses 6.0 5.7 6.0 6.0 Profit Before Tax 10.0 10.3 12.0 15.0 Profit Increase 3.0% 20.0% 50.0% Harvard Business School Publication #9-192-09
- 5. © 2014 SiriusDecisions. All Rights Reserved 5 Discussion Overview •Key Issues We See: • Sales organizations efforts in transforming their sales organizations are stalling • Selling value needs to happen throughout the buyer’s journey • In absence of value, reps are forced to negotiate on price •What You Will Walk Away With: • An understanding of the changing buyer’s journey • A road map on the changing conversations your reps need to have to engineer value • How to leverage technology to enable this change
- 6. The Changing Buyer’s Journey
- 7. © 2014 SiriusDecisions. All Rights Reserved 7 More Than Ever: Understand the Buying Process Solution Vendor SelectionEducation Loosening of the Status Quo Committingto Change Exploring Possible Solutions Committingto a Solution Justifying the Decision Making the Selection
- 8. SiriusPerspective: By the time a rep first meets with a buyer, need may be preordained and a solution preconceived. Preordained Need/Preconceived Solution 8 While most marketing and sales organizations have recognized this seismic shift, many have done little to adjust. Need and Solution Web sites Blogs
- 9. Changing the Conversations Sellers are Having With Their Buyers
- 10. SiriusPerspective: Moving from product to solutions will require a different set of competencies. The Product to Solution Evolution PRODUCT SOLUTION
- 11. © 2014 SiriusDecisions. All Rights Reserved 11 Most Prominent Inhibitors to Sales Achieving Quota 11 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% Insufficient Leads Poor Sales Skills Too Many Products to Know Information Gap (Industry, Solution, Etc.) Inability to Communicate Value Messages 26.0% 24.3% 21.4% 16.0% 13.3%
- 12. SiriusPerspective: Relationships don’t matter to CXOs as much as company and industry insight. What Does a CXO Want From A Salesperson? 1 4x Cultivate a personal relationship with me 2X Demonstrate deep expertise about my company Show they care about my success Share insights about my industry
- 13. © 2014 SiriusDecisions. All Rights Reserved 13 We Asked Salespeople What’s Changed? 1. Buyers are more informed • Access to Content • Peer Network • Access to Data 2. Buyers need more (and earlier) ROI • Reason to Change • Peer Examples • Executive Support 3. Buyers are less likely to engage earlier • Self Service • Network Introduction • Events Not Working
- 14. © 2014 SiriusDecisions. All Rights Reserved 14 Diametrically Opposed Forces 1 4 Transactional Buyers Reps Told to Sell Solutions
- 15. © 2014 SiriusDecisions. All Rights Reserved 16 Three Key Roles Salespeople Must Play • Knowledge of products, customers, industry issues, financial acumen, best practices, etc. • Critical early in process Domain Expert • Aligning internal resources with customer resources efficiently and effectively • Critical in middle of process Strategic Orchestrator • Demonstrate that potential risks are outweighed by potential rewards, using proof sources and quantification when needed • Critical later in the process Risk Alleviator
- 17. © 2014 SiriusDecisions. All Rights Reserved 18 Observable Outcomes Customer Buying Cycle Explore Options/Refine Requirements Loosening of Status Quo Needs Recognize/Commit ment to Change Evaluate Options Requirements Defined Implement & Evaluate Justification of Decision/Validate Negotiate & Sign Contract • Conducts thorough Discovery analysis, Monetizes problem of status quo • Content and tools • Solution shipped to customer • Develop and maintain relations with decision makers and influencers • Content and tools • Requests meeting with customer • Content and tools • Shares business case for change away from status quo • Content and tools • Tailored Solution Demo provided to all necessary Stakeholders, awaiting decision from customer that we are the preferred choice • Content and tools • Final proposal and terms provided to Key Stakeholders • Content and tools • Contract prepared & delivered to customer • Value Actualization • Contract delivered for processing -Finalize any requirements for processing • Content and tools 1. Needs Exploration 2. Needs Developed/Identified/ Agreed 3. Solution Development 4. Solution Accepted 5. Final Terms & Conditions 6. Contract Submitted 7. Value Actualized Sales Process Sales Stages 5% 10% 25% 50% 75% 90% 100% Observable Outcome e.g. web activity Observable Outcome e.g. email confirmation of needs/scope and timeframe Observable Outcome e.g. Solution Map document agreed upon Observable Outcome e.g. email confirmation that solutions is in alignment Observable Outcome e.g. Access to economic decision maker has occurred Observable Outcome e.g. Contract signed
- 18. © 2014 SiriusDecisions. All Rights Reserved 19 The 7 Points where Value Leaks Customer Buying Cycle Explore Options/Refine Requirements Loosening of Status Quo Needs Recognize/Commit ment to Change Evaluate Options Requirements Defined Implement & Evaluate Justification of Decision/Validate Negotiate & Sign Contract • Conducts thorough Discovery analysis, Monetizes problem of status quo • Content and tools • Solution shipped to customer • Develop and maintain relations with decision makers and influencers • Content and tools • Requests meeting with customer • Content and tools • Shares business case for change away from status quo • Content and tools • Tailored Solution Demo provided to all necessary Stakeholders, awaiting decision from customer that we are the preferred choice • Content and tools • Final proposal and terms provided to Key Stakeholders • Content and tools • Contract prepared & delivered to customer • Value Actualization • Contract delivered for processing -Finalize any requirements for processing • Content and tools 1. Needs Exploration 2. Needs Developed/Identified/ Agreed 3. Solution Development 4. Solution Accepted 5. Final Terms & Conditions 6. Contract Submitted 7. Value Actualized Sales Process Sales Stages 5% 10% 25% 50% 75% 90% 100% Risk: • Low value business case Effective Practice: • Provocation/Insight into value achieved by peers Risk: • Volunteering to discount early Effective Practice: • Lead with Value/ROI justification Risk: • “Market Price” too low Effective Practice: • Capture Additional value areas from Key Stakeholder Discovery Risk: • Your solution looks like everyone else’s Effective Practice: • Deep Discovery to highlight your Unique Value in Customers terms Risk: • C-Suite Pushback Effective Practice: • Link ROI to Customers’ Strategy/Risks Risk: • Procurement ‘Your Price is too high!” • Nibbled to death by Rabbits Effective Practice: • Negotiate once and with a plan Risk: • Next deal wants the ”special” customer price Effective Practice: • Measure the actual value delivered
- 19. © 2014 SiriusDecisions. All Rights Reserved 20 Guide your sales teams through the process
- 20. © 2014 SiriusDecisions. All Rights Reserved 21 Mapping Sales Productivity 21 Core Selling Activities Non-Core Activities Internal Direct Engagement (expense reports, travel) BLACK HOLE (customer service calls) RELATIONSHIP (research, proposals) ENABLEMENT (prospecting, sales calls) ENGAGEMENT
- 21. © 2014 SiriusDecisions. All Rights Reserved 23 Buyer Need Definition Build Out Conversation Templates .
- 22. © 2014 SiriusDecisions. All Rights Reserved 24 Buyer Need Definition Initiatives Challenges Job Role Buying Role Common Titles SiriusDecisions Persona Template
- 23. © 2014 SiriusDecisions. All Rights Reserved 25 Create the Persona Map in Salesforce.com 25
- 24. © 2014 SiriusDecisions. All Rights Reserved 27 Prepare Your Reps For Every Conversation
- 25. COPYRIGHT © REVEGY, INC. // PROPRIETARY AND CONFIDENTIAL Value-Selling Best Practices
- 26. COPYRIGHT © REVEGY, INC. // PROPRIETARY AND CONFIDENTIAL Effective Practice #1: Know Your Ideal Customer Profile
- 27. COPYRIGHT © REVEGY, INC. // PROPRIETARY AND CONFIDENTIAL Lead Score ProspectFit Effective Practice #1: Know Your Ideal Customer Profile
- 28. COPYRIGHT © REVEGY, INC. // PROPRIETARY AND CONFIDENTIAL Effective Practice #2: Don’t Chase the ‘Unwinnable Deal’
- 29. COPYRIGHT © REVEGY, INC. // PROPRIETARY AND CONFIDENTIAL Effective Practice #2: Don’t Chase the ‘Unwinnable Deal’
- 30. COPYRIGHT © REVEGY, INC. // PROPRIETARY AND CONFIDENTIAL Customer Buying Cycle Explore Options/Refine Requirements Loosening of Status Quo Needs Recognize/Commitm ent to Change Evaluate Options Requirements Defined Implement & Evaluate Justification of Decision/Validate Negotiate & Sign Contract Effective Practice 3: Coach the Deal Right Deal? Do we understand the Business Need? 1. Needs Exploration 2. Needs Developed/Identified/ Agreed 3. Solution Development 4. Solution Accepted 5. Final Terms & Conditions 6. Contract Submitted 7. Value Actualized Sales Process Does the Business Need Justify the investment? What is our Give/Get Negotiating Plan?
- 31. COPYRIGHT © REVEGY, INC. // PROPRIETARY AND CONFIDENTIAL Effective Practice 3: Coach the Deal
- 32. COPYRIGHT © REVEGY, INC. // PROPRIETARY AND CONFIDENTIAL Effective Practice 4: Does each stakeholder see the value? ✔ ✔
- 33. COPYRIGHT © REVEGY, INC. // PROPRIETARY AND CONFIDENTIAL
- 34. © 2014 SiriusDecisions. All Rights Reserved 37 Key Take Aways •Reps must look to build the “case for value” throughout the sales cycle. •Be sure to provide the infrastructure and support your reps need. •Ultimately, every sales comes down to a series of conversations.
- 35. COPYRIGHT © REVEGY, INC. // PROPRIETARY AND CONFIDENTIAL Jim Ninivaggi Service Director Jim.ninivaggi@siriusdecisions.com SiriusDecisions www.siriusdecisions.com Tim Braman VP Corporate Strategy tbraman@revegy.com Revegy www.revegy.com Questions?
Hinweis der Redaktion
- Jim, I’d like to talk about establishing the initial price, because everything erodes from there. Initial discounts “this is just our list price, we can provide discounts” Negotiating against themselves
- 4
- Tim needs to address last bullet Jim Key issues – Tim What you walk away with
- Jim through Buying Process Tim then gives examples with Arrows (no text) Today Challenger – insight or HBR with Provocation Selling 7 years ago or 20 years ago with Solution selling and latent/unkown pain economist Dan Ariely and his colleagues from MIT and Carnegie Mellon University studied this question, and came up with some intriguing findings: You have more control over your pricing than you might think, and can “anchor” higher pricing if you do it early in your sales conversations. A customer’s initial impressions of your value shapes how they view the ultimate prices they are willing to pay. Subsequent decisions are made in relation to the first assessment of value, so you must make the first one work for you. If your customer already has a reference point for the pricing of your solution (perhaps by comparing it to their current solution, or competitive offerings), it is critical to differentiate your solution and then anchor as high an initial price for it as you can.
- Tim to take this slide No more walking brochure – home depot: Hammer/Nail Gun for deck Sell solutions, means you have to understand and relate to what others have done and the value others have achieved. Value that you add as a sales person, domain expertise, industry/competitor knowledge
- Jim to take - Value message isn’t the benefit of a feature
- Jim’s slide.
- Jim to lead Differentiate early- and prove it. unless you are the low cost provider Tim to tell the Revegy story The CFO says “hey, we just bought SFDCSalesforce.com, what is this Sales Enablement stuff you want The key is to predict the future for them, this is going to happen.
- Jim to lead. DE – ability to diagnose Tim Color Commentary - The sales executive’s personal value – in sequence Plus risk of my LMD
- Especially a SAAS model
- Providing insights and tools at the moment in time they need them Next Jim is going to talk about preparing your team for each of the conversations.