The Philosophy of Sales Pricing

It was with some amusement that I read in CSO (Chief Sales Officer)

http://www.csoinsights.com/Topics/Sales-Strategy

that:

· 80% of sales opportunities are LOST to lower prices by the competition,

but ONLY

· 20% of sales opportunities are WON by lower pricing than the competition.

This, as a statistic, does not make sense.
To make sense they would have to be similar.

Instead, they are a Pareto:
80% of the time, I lose on price, and 20% of the time I win on price.

How would we rank this salesperson? 
Wins 1 deal in 5, and wins that deal on price?

Unless they have 500% pipeline to target coverage, they never make target.
As a Company, we cannot be growing market share,
in a vibrant market but losing four out of five deals.

We cannot work with focus,
because we do not know which deals we will win or lose
until the pricing quotation is made at the end of the sales process!

The report includes these statistics too,
Poor Sales Process execution is a factor in 20% of losses, and
Sales Execution is a factor in 35% of wins.

Product ‘superiority’ accounts for 75% of wins,
yet is only a factor in 25% of losses.

These combined would suggest that if you have

the cheapest and the best product you succeed

in sales, with the process of selling only playing
a secondary factor!

Finally, a statistic that makes sense:

• 44% of deals are won by the best Customer Relationship and

• 55% of deals are lost by a poorer Customer Relationship

Conclusions

• You do NOT need salespeople and sales process
  to sell your superior product at the lowest price.

• you DO need skilful Salespeople to sell
  your similar product at a similar price,
  because Buyer Relationship counts!

• You need a Sales Process which WORKS and
  you need skilled Salespeople
  to sell your product in a market where
  you are perceived disadvantaged by product or price!

“WE NEVER LOSE ON PRICE” doesn’t mean you are the cheapest,

it means you have a perspective on the secondary importance of Price

BMAC Consultants specialise in developing skilled sales people
with a powerful sales process that builds strong Buyer Relationships.

.

What makes a 2016 Top Salesperson?

An old colleague and friend Chris Windley asked and then answered this question on his blog
http://bit.ly/fGyO1z
Here is my take.

 

Activity, Skill and Knowledge the three ‘sisters’ remain at the core of Sales Performance.
Even after 25 years of research, they remain constant, unshakable.
Simply by measuring activity, skill and knowledge at BMAC Consultants then,
we can Predict, with accuracy, future Sales Performance. 
However, 25 years of research have shown that
what we mean by Activity, Skill and Knowledge have changed dramatically.

 

Activity

Sales ‘Activity’ in 206MUST include web2.0 tools, if you let Sales Force Automation run your day,
week, or month you will be a SALES FAILURE not a sales success. 

Sales people and Sales Managers must learn how to drive technology,

NOT be driven by technology. 

Revenue Generating ACTIVITY today is NOT about
Cold calls, or First appointments or Thank You notes.
Managing a Sales Team last year, we measured Activity “Net Cash Generation”,
which had no correlation to cold calls, first appointments or Thank you notes!

Today, activity is about lead Generation, lead nurture by Marketing NOT Sales!  Sales are about Opportunity Management.

see my blog http://brianmaciver.blogspot.com/2010/06/sales-energy.html

 

Skills

Skills, well Closing is out, big time. 
There is no correlation between Closing ‘Ability or Skill’ and Sales Success.

If you are great at “Handling” Objections,
then I bet you spend most of your time on the golf course in Sand Bunkers,
I prefer to putt on the Green instead!

The ways in which we meet, present and propose to Buyers have all changed beyond recognition.
Face-to-face, conference calls and Tele-presence meetings, PowerPoint without bullet points,
managed ‘try before you buy’ demonstrations are part of are part of Selling today.

If you only sell ‘Solutions’ to people with ‘Problems’, then you can still SPIN®.
However, you will miss the biggest part of the Market, those Buyers who do not have problems
but who are looking for ‘OPPORTUNITIES’, and that’s a completely different Sales Skill set!

Successful Selling is still about Interactive Competence,
except that with smarter, better-informed Buyers than ever,
then Sales people need a broader, deeper range of behaviours than ever.

In 2013 Salespeople must be able to influence
their Buyer’s thinking, their emotions and their actions.

“Psycho” selling is gone, replaced by Neuroscience research into WHY and HOW people buy.
‘Stimulation’ and ‘Choice’ which can be tested by biometrics give us greater insight into BOTH Buyers
and Successful Sales Behaviours than ever before.
Insight Selling, based on the research of The Challenger Sale, is having an impact on Top –end Selling.
http://brianmaciver.blogspot.com.es/2012/05/putting-challenger-sale-to-work-four.html
Value CONSTRUCTION is an essential Part of B2B selling.
http://brianmaciver.blogspot.com.es/2012/04/putting-challenger-selling-to-worktwo.html

 

Knowledge

Sales Knowledge in 2013 is based on ‘self directed learning’.

With web 2.0 it is inexcusable for a Professional Salesperson to be ignorant of their own products, their Competitor’s products and their Customer’s business.

Ninety minutes on the net, Google, Blogs, Facebook and Twitter should give the basics.

Product Training is sadly becoming out-dated.
Now we need to Train on how to Learn quickly!

 

Activity, Skill and Knowledge, the Sisters,

have two cousins Attitude and Strategy.

 

Attitude

You CANNOT succeed on Attitude alone (watch ‘The Apprentice’ for proof),
yet you will not succeed without the ‘right’ Sales Attitude either!
http://brianmaciver.blogspot.com.es/2012/11/managing-sales-attitude-for-success.html

Strategy

I have seen more sales lost through poor, or NO strategy, than any other cause.

The only way you beat IBM, Microsoft, Accenture, or HP,
is by having a better Account and Opportunity Strategy than they do.
http://brianmaciver.blogspot.com.es/2010/08/sales-strategic-success.html

 

The Balanced Scorecard, the Sales Dashboard, still has five dials:

Activity, Skill, Knowledge, Attitude and Strategy;

and these dials still describe selling;

it is what we mean, measure and develop that has changed in 2016.