B2B Companies Are Facing Down A Collapse of Value In Sales. The way sellers and buyers interact today is causing big problems for B2B sales organizations. Prospects keep sales teams at arm’s length until very late in the buying journey. They form large committees, then ask you and your competitors for quotes. They drive down prices and choose a winner in the race to the bottom.
This process – your sales process – is destroying more value in your organization than any other place in your company.
Think of it this way: For a stubborn prospect, you may have to cut 5% or more off of your price to be competitive. But where is that 5% coming from? It isn’t deducted from the cost of delivering the solution. No, it comes from your margin. And for many companies, that small discount could have erased one fourth or more of that margin.
What other place in the company could remove that much value without anyone batting an eye? Without anyone taking drastic action?
The hard truth is that most sales organizations are unprepared and ill-equipped to sell today. They staff marketing departments that out-bid each other for late-stage leads. They send salespeople in front of committees with presentations about their “differentiators.”
To your prospects, you and your competitors end up looking, sounding and acting the same. When this happens, they choose the lowest-cost option, or choose to do nothing at all.
This is why value is collapsing in companies everywhere. Sure, outside factors are a cause, too, but this collapse has been happening for decades, not months. What’s worse? The factors at work are speeding up, and they won’t stop on their own. As an executive, you owe it to your team to ensure they understand what they’re up against, and what to do about it.
Call them the three deadly Cs: commoditization, compressed selling time and consensus decision-making. Each is difficult, on its own. But together, they are capable of creating enough friction in sales to completely alter the course of a company.
The only way to overcome the three deadly Cs is to establish and maintain a revenue culture within your organization strong enough to defend your value.
Your team must meet their prospects earlier than they are. They must enter the picture so early that the prospect hasn’t started “shopping around” yet. This is the way to reclaim the time that’s been taken from them in the sale.
Your team must find prospects higher up the organizational chart. In fact, they probably need to be two or three positions higher than they are right now. That may mean talking to VPs or SVPs. It could even mean calling on the C-suite. This is the way to be seen as a real solution to a real threat. The alternative is to be one of many options on the table.
Becoming a priority for your prospect is the most effective way to re-establish your value. This is why we titled the book I co-authored The Priority Sale. It’s easy to understand why we want to be a priority for our prospects. It’s much more difficult to achieve.
Knowing that all growth begins with telling the truth, you must start by assessing how you sell.
Is your team reaching real decision-makers or are they calling on buyers? Is your marketing team getting appointments with companies that aren’t shopping you around? For most companies, these answers are equal parts enlightening and alarming.
No longer can companies afford to think of marketing and sales as separate functions. Your prospect, after all, is on one journey. Instead, they must become a revenue team, accountable for defending your value.
They must do more than offer quotes when asked. Being responsive is table stakes in any modern buyer-seller relationship. They must go further. They must be proactive, finding higher-level decision-makers, earlier in the sale. They must align your real impact to your prospects’ top priorities. They must navigate the sale, proactively avoiding the traps and blind spots they know will exist.
The way prospects want to buy has changed. The revenue organization must change with it. This change takes time, yet the three deadly Cs wait for no company. The collapse is accelerating.
If you want to be a company that maintains its relevance through this change, you must take action. It’s time to establish a revenue culture that protects your value and protects your margins.
Written by Bryan Gray.
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