August 26, 2012

Sales Low? You Have a Value Problem or Sales Problem.

Are your sales low?

If so, you have a value problem or a sales problem.  If you’re really unlucky you have both problems.  Figure out the root of your problem right now and fix it.

Everything starts with your product.  Does it solve a costly problem or fill an important need for customers ?  In other words, does your product make the customer’s life easier and better?  Is it better than other products out there?  If so, congratulations — you have a high-value product.

Not sure?  A great test is to ask your customers if they would buy again.  If more than 50% of your customers would not buy again you can be sure your product sucks, erm I mean is low-value.  Put on your thinking hat and make your product better.  Then run the test again until it’s high-value.

If your product is high-value but your sales are still low then you probably have a sales problem.

Your sales team’s  job is to raise the “perceived value” of your product.  “Perceived value” is the customer’s perception of value.  Customers will buy your product if they believe — or better yet, know from experience — that the value is higher than the price.

Here’s the kicker — lots of customers don’t understand their own problems or know what they need.  They might think they do, but they don’t.  You have to show them.  That’s sales’s job.  With very few exceptions a great product will NOT sell itself.

My old company had a high-value product that very effectively solved a critical problem all companies have — recruiting great new staff.   Our biggest challenge was getting customers to understand how paying us $79 per job post was cheap compared to the cost of not hiring or hiring someone who wasn’t the right fit.  Many customers didn’t understand that until we showed them.  Sales’ ability to communicate and raise the perceived value of our product was critical to our success and ability to charge a premium price for a high-value product.

We focused like hell on sales and it paid off.  Our competitors never figured that out.

So which problem do you have, value or sales?

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