The topic “complex sales” appears all over the selling performance landscape. There are a few definitions of the term making the rounds; thankfully, they’re pretty similar. All include multiple people making a buying decision.
I’d like to propose a slightly different perspective on “complex sales”; not really an alternate definition, but a point of view to help us improve our craft.
Let’s focus on one characteristic of complex selling that requires a strategic approach: when the value of a product or service applies outside of the department whose budget buys it.
“Simple” Complex Selling
When multiple customer parties engage in a group buying decision, sellers weave each individual’s concerns into the fabric of the group process. Incoroprating some needs (for example, legal’s involvement on terms and conditions, or purchasing’s intensity on price, delivery, and re-order logistics) into the sales process is standard sales procedure. In contrast, expert practice means using value perspective to gain selling leverage. To illustrate more clearly, let’s come back to simple examples after we talk about some of the more advanced ones.
“Complex” Complex Selling
Many of my clients’ offerings (product and/or service) offer significant value. Often, conventional value calculations/evaluations and comfortable apples-to-apples price comparisons just don’t work. Worse, when a customer uses conventional calculations with innovative products/services, they undervalue, ignore, and even worse: under-pay for the value received. It’s not the customer’s fault. Sadly, it’s the seller’s.
The Concept of “Unconventional Value”
What happens to the selling process when your “product” provides benefits like the ones below? How do your sellers get prospective customers to acknowledge unconventional value propositions? Here are some illustrations:
Higher Reliability
A component which greatly increases reliability of a customer’s robotic equipment (eliminates a significant unscheduled downtime – each failure resulting in a six- to seven-figure cost event for customer’s customer) is an example. The commodity manager for this component looked primarily at price until the field service organization provided emergency repair cost figures. Sales was aware that some customer contracts had costly uptime guarantees incorporated in them. Adding these key perspectives to the customer group buying decision changed the entire conversation.
Product miniaturization (similar functionality from a smaller form factor).
In a familiar example, as computers went from building-sized, to room-sized, to desktop sized, value impacts were felt in unconventional areas like real estate, electricity usage (power consumed by the computer and by the air conditioning units that cooled them). Separately, entire new medical specialties arose as laparoscopic instruments were invented then became more compact. The impacts, while dramatic, were not so to departments who purchase surgical instruments. Administrators, surgeons, insurers/payors, patients (better recoveries), and more have driven adoption.
Superior Product performance.
As computers became more powerful, the “killer app” has gone from spreadsheets, to computer graphics, to artificial intelligence. Each of these new applications enabled a brand new value web, new buying influences and value propositions. Another example: a piece of lab equipment that processes samples more rapidly. Some contract lab services customers compete with one another based upon turnaround time. For these, I suggest learning about revenue impacts of faster guaranteed turnaround times with the lab corporation’s sales and marketing functions (who had never been involved in the lab equipment sale before).
Longer Useful Life
In another reliability example, consider a surgical tool guaranteed to perform to specification throughout its service life. Interrupting an operation to locate and replace a failed tool is simple “complex selling” practice. A more value-driven seller realizes that avoiding patient harm has a whole cascade of “interested parties” and cost impacts which can be explored and quantified.
Customer resource savings.
Lower scrap rates, lower energy usage, reduced waste streams…all create new value. Each requires an unconventional approach to the capture the new value produced. For example, consider an outsourced lead generation service which saves marketing departments a variety of internal costs: turnover of development reps, ramp-up costs for new programs (hiring, training, support, campaign design, expertise acquisition, lost revenue), and often lead quality (lowering selling costs, and increasing revenue). Selling straight cost-per-lead surrenders a lot of potential value.
Specific Example: A drug that lowers post-surgery opioid use.
This one’s fascinating. Opioids are cheap for hospitals; far cheaper than alternate pain management products to the “budget owner”, pharmacy departments. Cost savings elsewhere can dwarf price, though. Opioids eat floor staff time: residents and nursing staffs spend a lot of time babysitting PCA (patient controlled analgesia) units. If the drug is used within a protocol that reduces stays, reduces complication rates, increases patient health, and reduces readmissions, the cost savings can push pharma costs into “rounding error” territory . Some of these costs go to the hospital, some go to insurance companies. Let’s think even bigger for a moment about how has value (without necessarily thinking about how to monetize that into the sale): local government agencies benefit from lower opioid use: law enforcement, public health, educators (drug use in schools), employers (especially industrial companies who use heavy/dangerous equipment). How would you (and would you) bring those factors into play?
Simple Logic, Not Universally Applied.
Complex selling methodologies like Miller Heiman Group’s Strategic Selling provide a framework for how to include more buying influences, but your selling culture’s “nose for customer value” is what points them to the correct “unconventional buying influences”. Applying Strategic Selling to purchasing and legal is pretty straightforward. Extending the methodology to the examples above is well within the methodology’s capabilities, but some of my clients have asked for my help in refining their skills around capturing unconventional value in cases like the ones above. Specifically, it’s important to strategically add the right buying influences to the group decision.
Even in more “conventional” situations, where you work with “the usual suspects” including purchasing and legal, performance can improve when you focus yoru methodology on value. Importantly, buying influences tend to understand and support your group involving approach if you are able to articulate a full value picture.
The examples above seem straightforward, but I work with a number of clients to apply value discipline into their sales culture. It’s how I pursue value in my consulting practice.
How do you develop customer-perceived value? Does your sales organization pursue value outside of “the norm”? Can they do it efficiently and effectively? What would happen if they did?
I invite your comment below, and welcome direct conversations on how to develop customer-perceived value.
To your success!