Establishing (& amplifying) our customer’s value gap
If we boil it down to the basics, there is one over-riding reason why our customers accept the need for change rather than sticking with the status quo: because (with or without our help) they perceive a large and growing value gap between their current situation and their future aspirations.
When this value gap is small and stable, they will be inclined to avoid the cost and risk of change and they will inevitably have other higher-priority projects that they will be more inclined to plough their scarce time, energy and money into.
But when this value gap is large and growing, when the pain, cost and risk of staying the same is perceived to be far higher than even the inevitable costs and risks associated with any significant change project, they will be inclined to make action a priority.
That’s why establishing, influencing and wherever possible amplifying our customer’s perceived value gap is such a critical element of any successful complex B2B sales campaign…
Current situation vs. future aspirations
And it’s why the essential foundation of any successful complex B2B sales campaign is a clear awareness of both the customer’s current situation and their future aspirations. But simply asking our customer where they believe they are today and where they want to get to in the future - and then merely responding to what they have told us - is a weak and inadequate strategy.
Rather than simply reacting to what they tell us about their current situation, we need to stick with the problem and delve deeply into the implications, the consequences and the as-yet unacknowledged needs that inevitably lie behind the customer’s initially stated needs. In other words, we need to help them to work out for themselves for themselves the full cost of inaction and their compelling reason to act.
The same is true when asking our prospective customer what future objective they want to achieve. By developing the goals that lie behind the initial goal, we can help them to recognise for themselves that timely action is even more important than they initially imagined.
We want to stretch both the negative aspects of sticking with their current situation and the positive benefits of achieving their future aspirations - but this amplification of our customer’s value gap comes with a caveat.
We must be careful to avoid stretching the scope of the project so much that it expands into an uncontrollable monster that requires far wider stakeholder involvement and far higher levels of scrutiny than would have been required to get the initial opportunity over the line.
It’s a question of balance, but one that I have seen top-performing sales people consistently master. They often do it in an unconsciously competent way, so in the rest of this article I’ll try and deconstruct what I observe them doing instinctively into a framework that any averagely intelligent sales person ought to be able to master with the right coaching.
There are four interlocking aspects:
- “Why change?” - persuading our customer that sticking with the status quo is the wrong strategy
- “What to?” - influencing our customer’s future aspirations and vision of a solution in a way that is strongly aligned with our core advantages
- “Why us?” - persuading our customer that our approach offers them a distinctively better chance of achieving their aspirations
- “Why now?” - equipping our champion to argue that our project is a higher priority than their organisation’s other investment opportunities
Let’s examine each aspect in sequence - whilst recognising that in practice the boundaries between them will inevitably blur and overlap.
We may initiate this stage by introducing an issue to our customer that they were not previously aware of or concerned about - or they may volunteer an issue that is currently on their mind. But whatever the initial source, we need to explore the problems behind the problem, the objectives behind the objective, and the constraints and limitations that may be holding them back.
We need to find ways of testing and ranking the relative impact and priority of these issues. We will want to know who else is affected, to understand how they might already have attempted to address the issue and with what results, and to establish whether there appears to be a strong enough initial business case for change.
Above all, we must resist the temptation to dive in and pitch our “solution” the moment they acknowledge an issue that we believe we can solve. If once we have developed their issues enough their case for change seems strong enough, we must then turn to helping them answer the question “what to?”
When focusing on this initial “why change?” aspect, we need to pay particular attention to:
- Our customer’s perception of their most critical challenges
- Our customer’s perception of their most significant opportunities
- Our customer’s perception of their most significant constraints
Once our customer is persuaded that there is a compelling reason to change, and assuming we have convinced them of our credentials, their focus usually turns to defining what their perfect solution needs to look like, what their credible options are, who needs to be on the decision-making team, and what their decision process and timetable ought to be.
Now, you might think that this is an idealised model of the customer decision journey, and in some respects it is. Many customers (not to say many sales people) can be tempted to rush past or ignore some of these aspects. But the chances of their buying process getting derailed later on increase dramatically if strong and thoughtful foundations are not properly laid at this stage.
If we sense that our customer is rushing ahead or is already in the selection stage without having established a clear vision of a solution, we need to educate them why it is their interests to get clarity in these matters before going any further.
But if we have managed to position ourselves as a credible, experienced and trusted advisor while the customer is in this phase, we have a tremendous opportunity to shape our customer’s vision of a solution in a way that leads towards (rather than directly with) our unique approach and capabilities.
When focusing on this “what to?” aspect, we need to pay particular attention to:
- The high-level approach the customer should be specifying
- The key capabilities the customer should be specifying
- The undesirable attributes that our customer needs to avoid
By the time our customer has reached this phase, they are already actively evaluating one or a range of apparently credible solution options. If this is the first time we have become aware of the opportunity (for example through the receipt of an unanticipated RFP), we need to very carefully assess whether we have a realistic chance of winning.
Research by Forrester has convincingly demonstrated that the vendor that does the most to influence the customer's vision of a solution (by actively engaging them during the “what to” phase) wins three-quarters of opportunities - leaving the late arrivals to fight over the scraps - typically by having to engage in a race to the bottom on price.
Similar studies by Accenture and IBM revealed that any individual vendor’s chance of winning an unanticipated RFP fall into the low single digits. It’s simply not worth investing our time unless we can engage with the business problem owner and revisit the considerations they went through in their “what to?” phase in the hope of uncovering a previously unconsidered angle.
Otherwise, this is the phase during which we must convincingly establish both our company and solution credentials and persuade the customer that we offer them the best and most reliable chance of achieving their future aspirations.
When focusing on this “why you?” aspect, we need to pay particular attention to:
- The alternative options the customer chooses to shortlist for evaluation
- How our customer perceives our unique advantages
- The supporting evidence needed to support our customer’s preference
Of course, the question “why now?” first emerges way back during the customer’s initial “why change?” phase, but at that time the question is typically taken to mean “why should we pursue this project now?”
The “why now?” question occupies centre stage again the end of the buying journey, but now it has a different meaning. Rather than the absolute priority of the individual project, the customer’s attention is now focused on the relative priority of the project compared to all their other current investment opportunities.
Given that no organisation ever has enough resources, projects vying for final approval find themselves compared, stack ranked and prioritised. Winning our champion’s recommendation is not enough to guarantee success - we must understand the bigger picture and help our champion to position the relative importance of our project to their ultimate decision authority.
When focusing on this “why now?” aspect, we need to pay particular attention to:
- Helping our champion to perfect their internal business case
- Understanding and influencing the relative priority of our project
- Ensuring that the negative impacts of delay are recognised
If you’ve got this far and can relate to the potential advantages of adopting this value gap perspective, I recommend that you review a handful of your most important sales opportunities. How much do you understand about the critical elements of your customer’s value gap?
How are you going to apply this knowledge in your opportunity strategy - and how are you going to fill in the gaps in your knowledge? Please drop me a line or book a call if you’d like to discuss how to put these principles into practice.