Building a Value Selling Practice: Right Tools for Right Team

Ahmed Elyamany

Value Selling Advisor & CEO | Axcieve

July 12, 2024

Reading Time: 11 minutes

Introduction to Value Selling

Value selling or Value-based Selling (VBS) is an essential approach in today’s B2B landscape, involves creating, quantifying, documenting, and probably visualizing superior value for customers, thereby justifying a higher price. This method emphasizes understanding customer needs, differentiating offerings through unique benefits, and effectively communicating these advantages to foster mutually beneficial relationships .

Marco Bertini, Oded Koenigsberg, and Todd Snelgrove have developed a framework that integrates three key principles—commitment, understanding, and proof—into a five-part process for value-based selling. This framework emphasizes the need for sellers to motivate customers for collaboration, educate them about the benefits, quantify the value, translate it into a compelling business case, and reward customers appropriately.

Bertini et al’s Five-step Value-Based Selling – MIT Sloan Review

Why Value Selling Is Critical for Sales Organizations?

Most significant advantages of value selling is its positive impact on an organization’s financial performance when sales can quantify and communicate the value of its products to clients. It justifies premium pricing and ultimately secures the high returns it deserves. Value-based selling (VBS) and the ability to quantify and communicate value in B2B sales have never been more critical. Customers are under pressure to reduce costs while sustaining profitability, and competitors are increasingly enhancing their offerings with digital or service components. VBS stands out by focusing on, visualizing, and quantifying benefits tailored to each customer’s unique needs, boosting margins while ensuring long-term value for both organizations at ends of engagement.

Core Value Selling Tools

Quantifying and Communicating Value

For value selling to be effective, companies need a set of cutting edge technology tools to perform the following:

Quantify Value: Develop methods to measure the tangible benefits their products or services provide. This can be achieved using value calculators, which help in demonstrating the financial impact and return on investment (ROI) to potential clients.
Justify Value: Clearly articulate how their offerings solve specific problems or meet the needs of their clients better than competitors. This involves understanding and presenting the unique selling propositions (USPs) of their products or services.

High-Quality Products

Value-based selling inherently requires high-quality products. Teams must ensure that the products they are promoting genuinely deliver on the promised value. This builds trust and credibility, making it easier to justify the price and benefits to clients.

Training and Development

To successfully implement value selling, sales teams need to be well-versed in several key areas:

Value Calculators: Sales teams should be trained on how to use value calculators to present the financial benefits of their products convincingly.
Client Justification: Teams should learn how to justify the value for their clients through well-structured arguments and data-driven presentations.
Understanding Customer Needs: Effective value selling requires a deep understanding of customer needs. Sales teams should be trained to listen actively, ask the right questions, and tailor their pitches to address specific client pain points.
Sales Training: Continuous training is essential. For example, in our Value Selling Enablement, we make sure sales teams refine their skills in value selling, argumentation, and presentation techniques.

Challenges Facing Value Based Sales

The shift to VBS requires a transformation in the way we envision sales. This includes sales team’s skills and support mechanisms to navigate the confusion and uncertainty about value salespeople are supposed to sell, the outcomes they are supposed to price, and the risks and responsibilities the seller and buyer are supposed to share. Value-based selling, while promising, often faces significant challenges that can undermine its success. As discussed by Marco Bertini and colleagues in their Value-Based Sales article in the MIT Sloan Management Review, these challenges stem from several key issues:

Wrong Premises: Senior executives often start with the assumption that their differentiated offerings inherently deserve a higher price. This sense of entitlement leads to the belief that the primary challenge is merely to quantify and communicate the advantages.
Misplaced Expectations: Executives expect that customers, when presented with hard numbers, will logically justify and happily pay a premium. This expectation is not always a reality in B2B markets, and such reasoning is not guaranteed.
Lack of Customer Understanding: Despite heavy investments in product development, customers frequently fail to see the unique value and what does it particularly means for their specific needs.
Pressure from Quotas and Targets: The initial optimism of selling on value fades when sales teams face the pressure of meeting quotas and yearly targets. This leads to frustration and often results in the abandonment of value-selling strategies.
Fierce Buyer Resistance: Buyers, especially in B2B markets, can be very resistant and skeptical, further complicating value-selling efforts. This resistance often results in the failure of value-selling arguments and the evaporation of early financial gains.

Ten Essential qualities for a Modern Value Salesperson

Based on the study done by Marco Bertini, Oded Koenigsberg, and Todd Snelgrove, Following table summarizes the key functions expected from sellers in value-based selling, why they are important, and the qualities needed to perform these functions effectively.

Function	Why	Qualities Needed
Explain a superior product, use value calculator, and selling arguments	To increase price, margin, and profit significantly	Analytical, persuasive, knowledgeable
Resist returning to aggressive discounts	To win volume without sacrificing profitability	Resilient, strategic, value-focused
Quantify and communicate every advantage	So customers will see value and pay a premium	Detail-oriented, data-driven, clear communicator
Cocreate value with customers	To ensure customers play an active role in realizing desired outcomes	Collaborative, empathetic, engaging
Prove added value and gain customer commitment	To foster a shared understanding and ensure mutual benefits	Convincing, trustworthy, relationship-builder
Educate customers on benefits	To reach mutual understanding of the range of benefits offered	Educator, informative, patient
Translate customer savings into a compelling business case	To make the value proposition undeniable	Financially savvy, compelling storyteller
Pass up short-term gains for long-term value creation	To build lasting customer relationships and avoid price-focused negotiations	Long-term thinker, patient, strategic
Influence customers’ own customers	To create demand for the value provided by leveraging stronger branding efforts	Innovative, brand-focused, influencer
Address affordability concerns with shared value models	To spread payment burden and improve customer relationships	Creative, problem-solver, flexible
Educate: Raise awareness of customer benefits	To make customers question the wisdom of pushing on price	Communicative, persuasive, collaborative
Narrow down benefits to what matters to each customer	To tailor the value proposition and achieve consensus on the solution’s benefits	Customer-centric, adaptable, focused
Engage buyers in discussions about value and trade-offs	To help customers see the value they will be sacrificing with cheaper solutions	Skilled negotiator, persuasive, insightful
Solve the “ABC problem” (Attributes to Benefits to Cash)	To clearly link product attributes to financial benefits for the customer	Analytical, data-driven, creative
Ensure evidence of benefits through cooperation	To verify the estimated benefits and strengthen customer relationships	Collaborative, detail-oriented, persistent
Use market research for unquantifiable benefits	To build a strong, credible case for benefits that are not easily quantifiable	Research-oriented, credible, data-driven
Translate impact with relatable language, visuals, and interfaces	To make the value proposition resonate with customers	Creative, relatable, visual communicator
Focus on a small number of key messages	To enhance value perception without overwhelming the customer	Clear, concise, strategic
Provide the right amount of detail	To enable informed decisions without smothering the customer with extraneous information	Balanced, insightful, customer-focused
Define clear next steps and operational framework	To ensure continued involvement and focus of senior management post-sale	Organized, proactive, strategic
Align interests with smart incentives	To sustain value-based selling efforts with strong, aligned incentives	Motivational, strategic, incentive-focused
Counter price requests with price-value trade-offs	To maintain value proposition integrity and avoid unnecessary price reductions	Assertive, strategic, skilled negotiator
Offer financing options or value-based pricing metrics	To accommodate customer financial concerns while maintaining value proposition integrity	Flexible, innovative, customer-centric

Value Salesperson major duties and qualities (Processed from Bertini et al’s Five-step Value-Based Selling – MIT Sloan Review)

Based on the table, we can extract the most important qualities in a salesperson for a value selling setup to be summarized as follwoing:

Analytical: Ability to quantify and communicate the value of products and services using data and metrics and understand how product attributes translate into financial benefits for the customer.
Persuasive: Skilled in making compelling arguments to justify premium pricing and can convincingly articulate the value proposition to customers.
Customer-Centric: Focused on understanding and addressing the specific needs and pain points of each customer and able to tailor the value proposition to resonate with individual customers.
Collaborative: Works well with customers to co-create value and ensure desired outcomes and engages effectively with internal teams (e.g., marketing, finance) to support value selling initiatives.
Resilient: Maintains a focus on value despite pressure from buyers to reduce prices and can handle rejection and stay motivated under challenging circumstances.
Long-Term Thinker: Prioritizes long-term value creation over short-term gains and builds lasting relationships with customers rather than focusing solely on immediate sales.
Strategic: Understands the broader market and competitive landscape and makes informed decisions that align with the company’s value selling strategy.
Creative: Finds innovative ways to demonstrate and communicate value and develops unique solutions to address customer affordability and other concerns.
Clear Communicator: Delivers key messages concisely and effectively and avoids overwhelming customers with extraneous details, focusing on what matters most to them.
Organized: Keeps track of follow-ups and ensures continuous engagement with customers and provides a clear framework for validating and measuring the success of the value proposition post-sale.

Focusing on these qualities can also hep sales managers during the hiring and training process of salespeople to succeed in a value selling environment.

Setting-up right VBS Environment for Success

You got to start with your people and their motivating environment. Remember: “your sellers are your first customers”. Cultivating positive attitudes, promoting self-efficacy, highlighting product innovations all hold extreme importance in assuring team’s VBS effectiveness. Empowering team with cross-function, process management, and customer Engagement tools are all essential prerequisites for sales reps to be able to steer the sales vessels through lengthy and complex Value Selling paradigm.

Organizations can accelerate adoption of Value-Based Selling through:

Adjusting metrics of success: Celebrate engagement outcomes, revenues, growth, over sheer profit, discouted numbers (Ulaga and Loveland 2014)
Handpicking talent: Ensure the whole of your sales force aligns with the evolving industry demands (Homburg, Hohenberg, and Hahn, 2019).
Start with managers: Arm your sales managers with the knowledge and tools to lead by example.

Motivation and Abilities to harvest business opportunities in Value Selling (Terho et al., 2017)

A final word

The transformation from conventional sales approaches to a service-first strategy in VBS environment demands a renewed vision and commitment. Equip, empower, and elevate your sales force, and watch as they steer your organization to unprecedented VBS success. It’s about cultivating, not replacing. Enhance the strengths, invest in effective training programs to plug the knowledge gaps. Collaboration and interdisciplinary partnerships are super important. Make sure sales team can effectively partner with various internal stakeholders when needed. Consider:

Defining roles clearly and setting distinct expectations.
Encouraging active engagement in solution-selling via robust training, insights, and resources (Salonen et al., 2021; Terho et al., 2017).
Equipping sales reps with state-of-the-art tools that empower them to act with data-driven confidence (Fu et al., 2010).

Learn More

There are several business researches and prominent thinkers who have been investigating the human and business domain factors impacting success and performance of B2B sellers switching to services and solution selling. Following is short list of references used in this post:

Marco Bertini, Oded Koenigsberg, and Todd Snelgrove, Acing Value-Based Sales, https://sloanreview.mit.edu/article/acing-value-based-sales/
Joona Keränen, Harri Terho, and Antti Saurama, Three Ways to Sell Value in B2B Markets, https://sloanreview.mit.edu/article/three-ways-to-sell-value-in-b2b-markets/
Homburg, C., S. Hohenberg and A. Hahn (2019). “Steering the sales force for new product selling: why is it different, and how can firms motivate different sales reps?” Journal of Product Innovation Management 36(3): 282-304.
Terho, H., et al. (2017). “Selling value in business markets: Individual and organizational factors for turning the idea into action.” Industrial Marketing Management 66: 42-55.
Lauzi, F., et al. (2023). “Understanding sales enablement in complex B2B companies: Uncovering similarities and differences in a cross-functional and multi-level case study.” Industrial Marketing Management 108: 47-64.
Salonen, A., et al. (2021). “Engaging a product-focused sales force in solution selling: interplay of individual-and organizational-level conditions.” Journal of the Academy of Marketing Science 49: 139-163.