FutureSight eBrief

In the last executive brief we introduced the importance of having a market-differentiating value proposition to drive greater solution sales and market success. Now we will look beyond the evolution of a value proposition within an organization to their actual creation.

The ability to consistently articulate a clear, crisp value proposition for your solutions across all corporate communications, business development and sales activities is very powerful. When done right, your customers will understand the value of your solution to their market, their company and themselves. In turn, you will have greater alignment during internal solution planning, demand generation and value-delivery activities. Creating a value proposition that resonates with its target is critical, but where do you begin?

This issue will focus on the different perspectives to consider, and provide actionable questions to be addressed when developing your industry-leading value proposition.

Best regards,
Wes Wernette

Three Perspectives for Developing a Compelling Value Proposition

Segment, Company and Role

Not having a compelling value proposition is a recipe for failure--sometimes quick and sometimes painfully slow. If your sales have been depressed and you have been swimming in a red sea of fierce competition, you are not alone. A Siebel research study showed that over 75% of executives at companies whose new products failed to achieve their objectives blamed poor value propositions as the root cause.

This article shares three distinct value perspectives you can apply to develop a more compelling value proposition: segment-level, company-specific and role-based. When companies are missing any of the three perspectives, their value proposition is most certainly missing the mark, and not contributing towards superior sales, customer satisfaction and competitive advantage.

Perspective #1 – Determining Segment- Level Value

Correctly communicating value at the segment level is critical for opening doors and gaining initial customer consideration. Unfortunately, many B2B sales and marketing professionals communicate value in broad, generic terms. We also see vendors making the fundamental mistake in communicating value in a foreign language. For example, we see vendors using language such as “improving business performance” and “achieving a high return on investment” when speaking to not-for-profit institutions, versus using language they would appreciate such as “improving organizational performance”, “lowering costs to society “, and “improving the public image”. The bottom line is this: value needs to be communicated in the eyes of the beholder, in the language they understand--theirs.

Basic Questions for Determining Segment-Level Value:

Perspective #2: Determining Company- Specific Value

This next perspective deals with communicating solution value when you and your prospective customer are further along in the sales dialog, when it’s time to have a “company-specific value” dialog. Here’s where you help your target customer build the solution “business case”, outlining revenue- enhancing, cost-reducing, and strategic benefits associated with your solution. Most vendors do not have a structured approach to articulating company-specific value. As a result, sales representatives and their prospects are constantly “reinventing the wheel” and winging it with half-baked presentations and analysis. This obviously results in variation in how company- specific value is defined, excessive time spent in pre-sales activities, lower close rates and greater discounting pressure.

Sales and marketing organizations can help their sales representatives enter this dialog with a business value framework. A business value framework helps them discuss specific revenue- enhancing, cost-reducing and strategic benefits associated with your solution. Supporting these benefits with actual customer evidence definitely strengthens the discussion. Once this base-level, qualitative understanding is established, the sales representative and prospect can move to quantifying the potential impact with a business value analysis modeling tool. Quantifying this company-specific value leads to a more concrete business case that accelerates the buying and solution adoption process while eliminating the need for excessive negotiations and price discounting.

Basic Questions for Determining Company-Specific Value:

Perspective #3: Determining Role-Based Value

Determining role-based value is instrumental in closing deals and accelerating solution adoption. People buy from people, so it’s important to understand who will be involved in the solution purchasing decision, what role they play in the company, and how they will uniquely perceive value associated with your solution. As a general point, individuals often have very different value perspectives based on the role they play and the function they are responsible for in the organization. For example, what is perceived as being important to the CFO can be fundamentally different from what is important to the VP of Marketing. It’s also important to anticipate and come up with value messaging for individuals who might associate more negative than positive value associated with your solution.

Ultimately, sales representatives need to be able to communicate the “what’s in it for me” for each party involved in the buying process. Unfortunately, most vendors leave this challenge solely in the hands of their sales representatives. Strong sales aids developed and validated through role-based research can help sales representatives quickly navigate their accounts, talk to the right parties, and have a value-based conversation tailored to the individual and the functional role they play - where buying decisions are made.

Basic Questions for Determining Role- Specific Value:

Conlcusion
Applying these value perspectives requires good preparation and research. The process of building a value proposition can often be accomplished in a few months by involving members of marketing, sales, and delivery in a value proposition development team - augmented with feedback from customers, partners and analysts. The process can be accelerated and improved through the support of an experienced consultant with proven methodologies. The benefits can be tremendous, resulting in greater sales, marketing and delivery alignment and sales success.

Where is your company in developing a compelling value proposition? Are your sales being hindered through lack of a compelling value proposition? If so, rethink your value proposition using the three value proposition perspectives to drive greater sales success.

Bruce Scheer is a speaker, author, consultant and partner with FutureSight Consulting. For feedback on this article or for more information on this topic, you can reach Bruce at (206) 686-5800, ext. 724 or via email atbruce.scheer@futuresightconsulting.com.

Did you know?

Facts you can use...

According to a study conducted by Customer Message Management Forum and the American Marketing Association, "Up to 90% of collateral created by marketing is never used by sales."

Support your sales representatives with the three value perspectives, providing them with the right value message at the right time to shorten their sales cycle and increase their sales success.

Contact Us Stay Tuned...

email: feedback@futuresightebrief.com
phone: (206) 686-5800
web: http://www.futuresightconsutling.com

With the marketing function being under ever-increasing scrutiny, our next Executive Brief will profile the three main drivers for improving returns on marketing investments: Innovation, Focus and Leverage.