COVID-19 has changed the world of B2B sales. Even if you started the year with a packed pipeline, few businesses have escaped the economic turmoil. About 50 percent of B2B buyers are holding off on purchases because of the pandemic, according to McKinsey & Co.
Over the last decade, the B2B industry has experienced substantial changes. Now, with an economic downturn, companies and their sales teams are facing new challenges. A recent Linkedin survey of more than 500 sales professionals uncovered the following insights:
- 51 percent of their customers are experiencing budget cuts;
- 45 percent indicated specific industries are at a standstill; and
- 42 percent saw turnover or layoffs at their customers’ companies.
The magnitude and type of response required varies by industry. For example, lowering quotas, slashing forecasts and cutting marketing budgets is expected from companies that have been disproportionately affected by the virus, particularly in industries such as automotive, travel and hospitality. However, businesses that have been hit less hard, including technology and e-commerce, can read that 50 percent statistic in reverse if frugalnomics is in full effect, meaning buyers are more economic-focused and risk averse than ever.
And because buyers are scrutinizing their decisions more, sales pitches need to be even more intentional and direct. They must show alignment to the buyer’s strategic initiatives and, most importantly, how the service or solution will help the buyer cut additional expenses. With all of this in mind, how can sales teams maintain existing business while fostering growth? Consider value-based or ROI selling.
What Is Value-Based, Or ROI, Selling?
According to HubSpot, “value-based selling is an approach that focuses on benefiting the customer throughout the sales process. Sales reps pivot to a consultative approach to provide more value to the customer so the sales decision is made based on the potential value the product can provide.”
So, rather than pitch information about products and services that a buyer has likely already read on the internet, sellers need to lead engaging and prescriptive interactions that quantify and communicate how the product or service will benefit the customer. For example, in the presentation justify the purchase decision by referencing how the product or service will help the buyer drive revenue or increase organizational efficiency to save time and money.
The Demand For Value-Based Or ROI Selling
In the current climate, all deals are receiving more scrutiny from financial decision-makers. This means sellers should treat all deals like they’re being pitched to the CFO of the buyer’s company. That being said, as most sales teams are shifting to remote selling, the need for differentiation is even more crucial.
Sellers who continue to leverage static pitch decks, offering information that is already online, will lose deals. Instead, buyers want sellers to bring value to the sales conversations. Sellers need to communicate the impact their product or service will have on the buyer’s business in the context of what the buyer cares about. If a seller is incapable of delivering this information, it creates a significant value gap–a divide between buyer expectations and a traditional sales and marketing approach.
As this value gap continues to grow, the greater the chances are of losing the sale altogether. In a recent study by Challenger, 40 percent of today’s B2B purchase attempts end in “no decision.” Due to the current state of the economy, B2B buyers have to work even harder to justify purchases. The only way to combat the value gap and meet sales quotas is to refrain from pitching products and start quantifying value.
How To Be Successful With A Value-Based Or ROI Selling Model
Sellers interested in switching from product pitch to value selling should look into the following:
- Shift the seller’s mindset to focus on value over product capabilities.
For sellers, shifting mindsets to value can be a challenge after primarily focusing on product capabilities. The most efficient way to get sellers in a value mindset is by showing them the value of the product, just as they would to buyers. Understanding the true advantage of selling value will help them create their own sales talk tracks more effectively.
- Marketing and sales content must be designed to support a challenge-centric approach.
When addressing the buyer, sellers must use impactful value messaging and insights.This is where value-added marketing content can help fuel engaging sales conversations. With more companies considering working remotely even past COVID-19, the shift in selling will naturally require sales reps to pay more attention to the format in which they’re presenting content. Consider using interactive presentations software or a sales enablement platform that allows the sales team to alter its presentation so it meets the needs of what the buyer is speaking to.
- Interactive value selling tools.
When creating content to support virtual selling efforts, many businesses turn to spreadsheets to help sellers calculate and communicate ROI or total cost of ownership. While this is a step in the right direction, it’s not always an effective or sustainable means for quantifying and communicating value to customers. Instead, consider incorporating ROI and TCO calculators. When leveraging these tools, both marketing and sales teams can ensure value propositions are clear from the buyer’s first interaction all the way to purchase.
Looking Ahead For Value-Based Or ROI Selling
Pandemic-era buyers are more frugal and skeptical than ever. However, that doesn’t mean companies should stop testing tactics and tightening processes. Value-based and ROI selling now and into the future will push businesses ahead during this uncertain time, helping solve unique business challenges and delivering on the buyer’s needs.
Carson Conant is the CEO and founder of Chicago-based sales enablement solution provider Mediafly. Having grown up in an entrepreneurial family, Conant is no stranger to the challenges and rewards of building a company from the ground up and assembling a brilliant team to successfully execute on his vision. Under Conant’s leadership, Mediafly has been recognized as an Inc. 5000 Fastest-Growing Company for five consecutive years, one of Inc.’s Best Workplaces of 2018, and a Best Place to Work by Crain’s Chicago Business. Mediafly’s software is currently leveraged by top Fortune 500 companies including PepsiCo, MillerCoors, Disney and Goldman Sachs.
