What are the chances you can win a B2B sales deal that’s priced higher than your competitors? As challenging as it may be, winning a competitive bid is not impossible.
How often do B2B buyers select the more expensive offering? In Primary Intelligence’s newest industry report, How to Win at a Higher Price, we examined nearly 900 B2B purchase decisions and competitive evaluations.
Our study discovered that 25% of wins sell at a higher price but selling at a higher price does pose a risk. Almost 50% of lost sales are priced higher than the competition.
That said, our research revealed that buyers will take into consideration the vendor’s product performance, company stability, customer support, and understanding of business needs and weigh the risk versus the value. If their evaluation shows high confidence in those areas, the higher priced vendor will win, but disadvantages in just one area may result in a lost sale. When vendors’ products show distinct similarities, buyers compare costs and frequently select the lower priced vendor.
Nonetheless, all is not lost. B2B sellers with the higher priced solution do close sales deals.
So how did a quarter of those wins in our study sell at a higher price?
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Sales Insights: Who is Calling on Whom?
/by John Hollandin Buyer-centric selling, Competitive intelligence, Improving win and retention rates, Win loss analysisGeoffrey Moore has written several books on product life cycles and when different types of companies are likely to buy.
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Analytics in Competitive Intelligence: Stated vs. Derived Importance
/0 Comments/by Primary Intelligencein Competitive intelligence, Excellent data analysis, Win loss analysisIf your company uses market information to make decisions, you are almost certain to be familiar with the ‘Of these items, how important was or which of these would you consider to be first, second, and third most important?’ These questions result in a measurement of stated importance, or those things that are easily identified and verbalized as important.
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Sales Insights: How to Respond to “Best and Final” Pricing Requests
/by John Hollandin Buyer-centric selling, Improving win and retention rates, Win loss analysisHow should sellers reply when they are not going to win a transaction but are asked for a “best and final” number? Some respond with the lowest possible price with the thought being they may be able to steal the business (unlikely) or at least make it a skinny deal for their competitors. It’s not a tactic I endorse.
I believe floating aggressive prices can come back to haunt sellers if and when the roles may be reversed in the future. It would be awkward if a seller’s customers got wind of pricing that was lower than what they paid.
My suggestion when asked for best and final pricing is to ask:
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Sales Insights: Where You Start Impacts the Outcome
/by John Hollandin Buyer-centric selling, Improving win and retention rates, Win loss analysisThe quality of a salesperson’s life in pursing opportunities is highly dependent on their starting point in the organization. I hope you would agree that starting at Key Player or decision maker levels is likely to result in:
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Why B2B Sales Professionals Must Understand Buyers’ Needs
/0 Comments/by Connie Schlosbergin Buyer-centric marketing, Buyer-centric selling, Customer experience analysis, Improving win and retention rates, Win loss analysisWhy is understanding business needs so critical to B2B buyers?
When buyers feel confident the sales rep understands their pain points, they’re also reassured that the rep will find the best solution to address those pain points and fill a need. In fact, solving business needs is a high priority for B2B buyers. Sales professionals who understand these needs will solve fundamental business problems for their buyers and have a greater success at closing deals than their counterparts who choose not to listen at all.
However, gaining a deep understanding of these buyers requires significant effort, patience, and good listening skills. It’s a journey that can take quite some time to perfect. When you’re a sales rep and you’re selling a product or service to a business buyer, understanding the other person is critical to your career success. Among other items, you must discover:
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Sales Insights: Avoid Negotiating with Buyers Unless You’re “Column A”
/by John Hollandin Buyer-centric selling, Improving win and retention rates, Win loss analysisA common ploy buyers use toward the end of buying cycles is having someone (often a non-Key Player) request a “best and final” pricing. Smart buyers with multiple vendors in the mix will negotiate with Column C to use their price against Column B, all in an attempt to get the best possible price from Column A, their vendor of choice. Some buyers may just fabricate pricing.
Some salespeople see this as an opportunity to win the business with aggressive pricing. In my experience, vendors selling non-commodity offerings can seldom discount their way into becoming Column A.
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4 Components of a Repeatable Sales Process
/0 Comments/by John Hollandin Buyer-centric selling, Improving win and retention rates, Win loss analysisHenry Ford is credited with creating production lines allowing cars to be built consistently regardless of the staff that assembled them. I’ve worked with consulting companies that wanted to “cookie cutter” engagements because repetition makes people more competent and efficient. It provides the added benefit of being able to identify and share best practices.
That said, many people feel sales calls are like snowflakes in that no two are identical. While calls are never identical, there are ways organizations can make them more consistent by defining parameters to provide context.
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3 Things You Must Know Before Selling to the B2B Market
/0 Comments/by Connie Schlosbergin Buyer-centric marketing, Buyer-centric selling, Customer experience analysis, Improving win and retention rates, Win loss analysisIn recent years, selling to the B2B market has presented new challenges for companies such as buyers’ growing tendency to vet vendors using online research and the interplay between the B2B and B2C buyer experience.
B2B buyers identifying and selecting their top tier of vendors for purchase evaluations—including the short list of contenders—often do so with very little or NO input from sales or company reps. Buyers also expect excellence from their vendors, based largely on their expectations from their experiences as consumers in B2C transactions.
So, what should companies selling to the B2B market know before they engage with their buyers?
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The Value of Sales Process
/0 Comments/by John Hollandin Buyer-centric selling, Improving win and retention rates, Win loss analysisSoon after starting my sales career I became aware there was a staggering list of things I needed to learn. The biggest challenge I faced was securing appointments with owners of small businesses. In retrospect I’m not proud to admit that my objective when making initial calls was to see if I could get a second call with prospects. My logic was that a follow-up probably meant the first call went reasonably well. I lacked the wisdom and experience to understand the difference between sales activities and progress. I had no concept or a sales process.
CRM is everywhere and yet there are some salespeople as inept as I was that are required to provide input into the system.
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The Types of Customer Data to Collect to Improve Marketing Strategy
/0 Comments/by Connie Schlosbergin Customer experience analysis, Excellent research methodologies, Improving win and retention ratesWhen some marketing professionals think about surveys, they generally think about close-ended feedback. Close-ended feedback, which is typically collected in online surveys, involves rating scales, “check boxes” of applicable categories, “yes/no” questions, and other data that is typically quantitative.
Close-ended feedback is usually efficient and straightforward for customers to answer, as well as straightforward for organizations to analyze. This type of customer feedback also provides the ability to easily compare different parts of the organization, different team member’s effectiveness, and overall customer experience from a quantitative, “temperature-taking” perspective.
In contrast, Read more →
How to Maintain Key Player Access
/0 Comments/by John Hollandin Buyer-centric selling, Improving win and retention rates, Win loss analysisInitiating opportunities at high levels offers several potential advantages to salespeople:
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To Ask or Not to Ask about Executive Insomnia
/0 Comments/by John Hollandin Buyer-centric selling, Improving win and retention rates, Win loss analysisRecently I was involved in a discussion about different types of questions sellers can ask during calls to have a buyer share goals (or problems) that can be achieved through the use of a seller’s offering.
We discussed the types of questions that can be asked and the pros/cons of each:
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New B2B Industry Report Available, “How to Win at a Higher Price”
/0 Comments/by Connie Schlosbergin Buyer-centric marketing, Buyer-centric selling, Win loss analysisWhat are the chances you can win a B2B sales deal that’s priced higher than your competitors? As challenging as it may be, winning a competitive bid is not impossible.
How often do B2B buyers select the more expensive offering? In Primary Intelligence’s newest industry report, How to Win at a Higher Price, we examined nearly 900 B2B purchase decisions and competitive evaluations.
Our study discovered that 25% of wins sell at a higher price but selling at a higher price does pose a risk. Almost 50% of lost sales are priced higher than the competition.
That said, our research revealed that buyers will take into consideration the vendor’s product performance, company stability, customer support, and understanding of business needs and weigh the risk versus the value. If their evaluation shows high confidence in those areas, the higher priced vendor will win, but disadvantages in just one area may result in a lost sale. When vendors’ products show distinct similarities, buyers compare costs and frequently select the lower priced vendor.
Nonetheless, all is not lost. B2B sellers with the higher priced solution do close sales deals.
So how did a quarter of those wins in our study sell at a higher price?
Read more →
7 Problems with Using the Word “Solutions” with Buyers
/0 Comments/by John Hollandin Buyer-centric marketing, Buyer-centric selling, Win loss analysisVendors and salespeople seem enamored with the word: “Solution.”
In my mind the term is vague, usually misused and a terrible waste of three syllables. Whether in marketing brochures, on websites or during sales calls, the phrase “We’ve/I’ve got the solution for you” seems presumptuous and self-serving.
How many buyers actually believe those statements to be true?
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“Winging It” Yields Poor Results
/0 Comments/by John Hollandin Buyer-centric selling, Excellent research methodologies, Win loss analysisThe recent CCS® Index showed that 53% of sellers are guilty of “winging” sales calls. Most everyone had been guilty of not doing their due diligence before going to make a sales call.
Activities that should be done as part of pre-call planning would be:
When calling on a prospect for the first time, Read more →
What is Win Loss Analysis?
/0 Comments/by Connie Schlosbergin Buyer-centric marketing, Buyer-centric selling, Competitive intelligence, Excellent data analysis, Excellent research methodologies, Improving win and retention rates, Win loss analysisAt the most basic level, win loss analysis helps sales, marketing, and product leaders understand the reasons for their organizational wins and losses so that they can increase their win rates and capture more business in the future.
Win loss programs are important at all levels of the organization because it helps explain why buyers choose specific solutions and why they do not choose others.
At a higher level, win loss programs help transform organizations as they make fundamental changes to what are often systemic problems. When managers see patterns in buyer feedback that consistently show outstanding—or sub-par—performance, they can replicate best practices throughout their organizations and avoid root cause behaviors that hinder long-term success. In this way, win loss analysis is sometimes compared to Kaizen, the Japanese practice of continuous improvement.
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Win Loss Best Practice Series: Competitive Intelligence Leads to Strategic Decisions
/0 Comments/by Connie Schlosbergin Buyer-centric marketing, Buyer-centric selling, Improving win and retention rates, Win loss analysisAny electrical socket around you provides a tap to a near endless supply of energy. Inside the wires, there is enough power to run a houseful of gadgets, recharge your electric car or deliver an awful shock (don’t try that at home).
But, until you use the power to do something (turn on the lights, recharge your phone, etc.), it really doesn’t offer much value. For the electricity to be effective, it must power something that is important to you. Otherwise, it is just a bunch of electrons with potential energy sitting in copper wiring.
Your competitive intelligence is very similar to the electricity in your wires. You can collect as much competitive intelligence as you like, but until someone uses it to power change in your company, it really isn’t effective at all.
Competitive Intelligence for Strategy
Your competitive intelligence is most effective if it:
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Avoid No Decisions by Answering “What’s in it for me?”
/0 Comments/by John Hollandin Buyer-centric selling, Improving win and retention rates, Win loss analysisNo decision is a terrible outcome for both buyers and sellers. It ultimately means both parties spent time, effort and money and at the end, the buyer decided not to buy from any of the vendors that bid. Sellers either get firm no’s or the vague commitment to revisit the offering at a later time.
I believe the primary reason for these outcomes is that buyers don’t see adequate value to justify the expenditure.
Let’s assume you are selling to a manufacturing company and calling on the person responsible for stocking spare parts to maintain their equipment.
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A Strong Qualifier for Proposals
/0 Comments/by John Hollandin Buyer-centric selling, Improving win and retention rates, Win loss analysisWhen asked in a word to describe the difference between A Players and B/C Players I would say:
Patience.
By that I mean they avoid prematurely talking about offerings that helps them avoid early pricing decisions. Top performers also understand how much control sellers give up after issuing proposals.
I believe proposals should document and confirm discussions with buyers and provide a buyer or buying committee everything that is needed to make decisions. Premature proposals often hang in seller’s pipelines and often wind up being removed months later after no decision has been reached.
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Honest Customer Feedback is the Cure for Insanity
/0 Comments/by Heather McDougaldin Excellent data analysis, Excellent research methodologies, Improving win and retention ratesThis is obviously a cultural rather than a medical definition, but if you sell for a living, and you cannot figure out what you’re doing that’s causing you to lose deals you were sure you were going to win, you might start to feel like you’re losing your mind.
When you get some honest feedback, and start doing different things, the outcomes change, and the insanity goes away. Suddenly the world makes a lot more sense, and you’re closing a lot more deals.
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