The 5 C's of Value

Many salespeople have a very rudimentary understanding of value.?As a result, the means for winning business is not a demonstration of value, but the application of the “discount default” - where the salesperson gives a discount to close the deal.

As sellers, buyers often tell us that our product or service is too expensive - we even begin to believe it! Without a real understanding of the value we provide, we can be cornered into deciding between making the sale at a discount, or not making the sale at all.

Sometimes price may be an issue. But often it's just a ruse to get us to drop our prices.

“Why don’t customers buy? Frequently the real reason they don’t buy is because they do not understand or appreciate the value that we can deliver to them.”

?In order to understand, differentiate, communicate and price our offering on the basis of value delivered, we must understand the 5 C’s of value.

1. Comprehend/Understand the things the customer values

As sellers we should begin differentiating what we do from competitors by understanding customers’ needs better than the competitors do. If we grasp what value means to the customer and what they’re trying to achieve, then it will be much easier to differentiate and communicate the value we are able to provide to them.?Solving the value mystery is key. e for the customer (differentiate the offering)

2. Create value for the customer (differentiate the offering)

Define and design a differentiated offering that addresses the customers’ requirements more effectively than competitors’ solutions can. Remember, just being different is not differentiation. Differentiation is being different in ways the customer values - so you need to have understood the things your customers do value!

And differentiated value is not necessarily just about the product. It's too easy to believe your product/solution is identical to the competitors, especially if you're told it often enough! Think about all the things the customer enjoys as a result of doing business with you (including you) and look for differentiation there. For example, your understanding of their challenges and their business.

3. Communicate the value

Put together powerful, persuasive value propositions that distinctly communicate value to the customer. Make them recognize that you have taken the time to understand their needs and create the value that they require.

4. Convince customers that your value is worth paying for

Confidence, the "sixth sense" of the 5 C’s, is vital in order to convince the customer that the price is right. When the customer tells you it's too expensive, instead of immediately giving them a discount, be confident. Don't let your body language give you away. If the value you deliver is good, don't be shy! Remind the customer of what they're going to be getting for the investment you are asking them to make. Confidence is key! ”

5. Capture value through effective pricing

Create prices that accurately depict the value of a product by using knowledge of the product, and its value to the customer. Make sure that you share in the value you are delivering for your customer. Value is not all one way, you need to be rewarded appropriately for the value you give.

?Conclusion

So why don’t customer’s buy? Because they don’t, or won’t, understand your value. Maybe that’s because salespeople fail to understand and communicate value effectively, or maybe it’s because businesses are sending their salespeople out ill-prepared. Either way, recognize that you have to get started. Sales and pricing need to work together to understand value from the customer’s perspective and to then price and communicate their value effectively.

?If this has raised any issues that you would like to discuss, book a date and time in my diary that suits you https://bit.ly/mikesdiary and let's talk value!

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