SKILL


The Value Proposition GEOFFREY JAMES


Here’s a simple proposition for every salesperson to remember: If you can quantify value, you won’t have to justify cost.


The value proposition is what you of- fer prospects and customers that justi- fies their investment in what you’re selling. Their return on investment (ROI). Before customers buy, they demand a credible, accurate estimate of the return they will earn on their investment. An inability to quantify value for customers manifests itself in various forms – long sales cycles, sales lost to competitors, customer indecision, and


the demand for discounting. These are thorns in the sides of many sales organizations. “Most salespeople don’t realize the cost of discounting,” says one sales expert. “If you are in a $15 million company and the average discount is 30%, you’re leaving mil- lions on the table. That’s huge.”


VALUE VERSUS COST Today you need hard figures that specify the revenue customers can


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expect to gain – or the costs they will eliminate or avoid – through your offering. Value quantification is also a potent weapon in the battle against what the expert calls “cost justifica- tion.” He says, “If you have to cost justify, you’ve probably lost. When you go in at the end of a sale and say, ‘Okay, here is the price,’ and then need to cost justify, well, that’s it. If you start with value and sell value throughout the process, there’s no reason to cost justify – because the value itself justifies the cost.” Most salespeople, however, are entering customer engagements with- out the right table stakes. “They may be intimidated by financial metrics. I see salespeople run from financial fig- ures,” says the expert – but also adds that automated value quantification


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