A client who has a 75% plus market share in one of the healthcare device markets had been reviewing their loss engagements over the course of a few months with their program team and me. Through a series of Discovery sessions, we identified a trend unbeknownst to the sales reps that was causing them to lose sales. At first glance, you would think price is the reason, but as we dove into the responses from the buyers, the real issue became very clear.
Initially the client thought the competition was out-pricing them. Their product was priced 15% to 30% higher than the competition, according to buyers. However, their product wasn’t really priced too high. The sales teams were too complacent with the product they sold.
The sales reps, accustomed to winning, approached their buyers with the “best and newest offering” that had features and functions the buyer didn’t need at the time.
So what was the competition offering?
Underdogs vs. Favorites
The competition has been looking for a way to get in the door at the hospital chains and find a way to break the dominance our client has in many healthcare systems. Knowing they are the underdog when competing against our client, the competition paid attention to what the buyer was asking for.
Buyers Have More Choices
Now our client’s competition is starting to get some traction by listening closely and understanding the specific needs of the client. If ignored, this could be a hefty loss to our client as substantial market share—including their utmost loyal clients—will soon have multiple vendors at their sites. Their competition is configuring or offering a solution that best fits the buyer’s needs even if it isn’t the “latest and the greatest” product.
Understanding Buyer Needs is Job #1
Don’t get me wrong. Innovation is important. But listening to the buyer and tailoring your product for each buyer is paramount. You need to make sure your intent is to help them get the best solution for their needs regardless if you are used to winning 75% to 80% of the time. In those deals you lose to the competition where they can get a foothold.
If the sales teams were listening and offering the best solution they could—even if it is a basic offering—they will continue to benefit from the blue ocean. Where often in the losses we are seeing there is now blood in the water. Watch out for the sharks.
What strategies do you use when your competitor dominates the market? Share your thoughts in the Comment section below.
Have you read our latest Industry Insights eBook B2B Vendor Success: Understand 3 Buyer Perceptions to Increase Win Rates in Close Competitions? This eBook highlights three key findings in how winning and losing vendors are perceived by their buyers as well as important recommendations for leveraging this buying criteria.