Selling Value, by Mark Stiving

« Selling Value » is a solid B2B sales book. It is no nonsense, applicable and structured knowledge sharing with a single daunting pricing question in mind: how do you sell value? This is a key principle of B2B pricing: forget about your product, its features and your cost base. Sell value!

Nevertheless, as the author gladly recognizes, value is a fuzzy concept that most people don’t understand. It means a lot of things to a lot of people. And very few know how to apply the « Sell value! » imperative. This is where Mark Stiving can help.

First, people buy benefits, not features. Unless they are experts and know how to understand the benefits that they can derive from the features. In that case, they don’t need sales people. Thus, as a sales, you should sell benefits.

Now, let’s talk about value. Here are a few important définitions:

• Economic value. This is the additional revenues and the costs avoided that your client can derive from your product. It can be calculated. It’s often true in B2B, much less in B2C.
• Consumer value. This is the intangible emotional value of a product for an individual. It’s very important in B2C and there are ways to estimate it. It also exists in B2B but is hard to calculate.
• Perceived value. This is what your client believes your product is worth. Perceived value is what you want to enhanced as a salesperson. It should be sold honestly, or it will show after the sale.
• Willingness to pay. A very different concept not to be mistaken with perceived value. This is what your client is ready to pay for the product.

So, why is perceived value different from willingness to pay? Because of inherent value and relative value.

• Inherent value. What the service is worth in absolue. The inherent value of air is huge. Without it, you die.
• Relative value. What the service is worth vs. the next available option. The relative value of air is zero in most cases. You can get it for free.

Inherent value convinces the buyers to move. It answers the question « Will I?« . Relative value convinces the buyers to choose you. It answers the question « Which one?« .

Will I? is the first questions buyers ask or should ask. Very often, they then move to which one? where they compare options. Part of the job of salesperson is to have clients forget there is a which one?. It helps sell value as « Will I? » typically depends little on price. You need a very big price swing to persuade someone to buy something they don’t need.

So, how do you push clients to feel they are in « Will I? » moments where « Which one? » is not an option? Here we’re back to classical strategy concepts such as Michael Porter timeless Cometitive Advantage. Mark Stiving offers five situations: innovation, large installed base with high switching costs, monopolies, subscription renwals and options or add-ons. In these cases, clients are less likely to shop around and more likely to buy on inherent value rather than on relative value.

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The bottom line is: help your client calculate their perceived value, it will enhance their willingness to pay

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You may feel through this synthesis that the author is structured. What about applicable? Here it comes. According to Mark, the first thing you want to do is to create a value table. It has 4 columns: Solution, Problem, Result and Value. Essentially, it’s a simple Excel model that links everything your client does to a dollar or euro number.

The Excel model is for you only. As a salesperson, your job is to have your client calculate their own value table themselves. If possible with your help. This is why you need to be prepared on your side. It helps guide clients. They may not have all the numbers at hand. They may resist the maths. They may hesitate. They may need help in the thinking. There are good questions to ask to help get quantifiable insight. Read the book for some question ideas.

To apply the value table, the author suggests you talk first about inherent value, without ever mentioning competitors. Ideally, price is never revealed until value has been discussed. Only if buyers mention competitors should salespeople guide them through a relative value logic and explain why and where their products are better. Key insight here: always assume your buyers are on a Trust Journey, i.e. they are willing to not consider alternative options.

Starting chapter 7, the book content stays wise and compelling. The author illustrates the need to talk to clients who already recognize they have a problem, tips to drive value conversations, negotiation tactics, influence tactics, delegation of authority, the need to embark your product team (usually a difficult point) and even the role of marketing in positioning value. Key insight: The sales department isn’t the whole company, but the whole company better be the sales department. Easier said than done. Read the book for solid advice about making it happen writen in a concise direct style.