Positioning for the Professional Salesperson
Of all the factors we discuss during our consulting and training sessions with clients, it's possible positioning is the most important. I love positioning because it's the essence of building value and increasing profit, while maintaining relationships.
Every market is divided into three distinct market levels. These fit on what I call the "Positioning Pyramid." At the low end of every market you'll find the "A equals B" position.
If you're selling something that looks the same, weighs the same, operates the same, tastes the same, carries the same service -- if everything about what you bring to the market is exactly the same as your competitor -- if A equals B in every respect – the customer absolutely has to base their buying decision on Price!
You'll notice on our graphic, we have a $ sign out to the right. That's because at the "A equals B" level of the market, price is everything. This is the "commodity" level of the market, and it's not a good place to be. If you, your products or services, or your company are perceived at this level, you have no power, no leverage, and will need every trick in the book just to maintain even low profit margins.
Let's look at the next level. At this level of the market, the perception is that "A is greater than B."
It could be that you offer better quality. You may be faster in response time. People like the looks of it, the shape, size, speed, great service desk, warranty, quicker delivery, innovative design, location -- for whatever reason; A is perceived as being greater than B.
At this level of the market, price is still a factor, but not the only factor. Value has entered the picture. The decision to do business is based upon "perception of value ." You'll notice in our graphic, the $ sign is smaller and Value has dominance.
Smart salespeople and sales managers are very skillful at moving themselves, their product and services and their companies out of the A=B category into the A>B category in the minds of their customers.
Business markets tend to mature over time. As a result, many salespeople view themselves as selling something that's becoming just another commodity. In most markets that's not true! Salespeople who can shape perceptions of value and understand positioning do very well in every industry and every areas of the country. They not only sell quantity; they sell with good margins.
Here's an interesting side note: When you're confronting price, cost justifications just don't work anymore. The days of poor mouthing and whining about your costs and your troubles are over. Buyers don't want to hear it. In today's economy, there's got to be a value in the equation, especially with large accounts. Creating value just makes more sense to people. It's a pull instead of a push. It accomplishes the same outcome, but with a completely different feeling.
So at the lower level of positioning, we have "A equals B." In the middle level, we have "A is greater than B." At the very top level of positioning we have "Sole Source."
Sole Source is born at that moment when, in the mind of a customer, you provide something they simply can't obtain anywhere else. Most companies do a good job of providing a sales force with the tools to move them from A=B to A>B, but that last step, to the sole source level, has to come from you!
It can be a result of personal rapport, or reputation, or of the trust that comes from knowing that even if there is a problem, a top professional will be on the situation with the best solution immediately.
Your challenge as a salesperson is to build value -- and it's better if you build it before you get to the table. Build value by constantly enhancing your position -- working your way up the pyramid. Remember, if you go into a negotiation at the "A equals B" position and can't rise above it, you have to sell on price, and your entire sales career will be fighting the commodity box.
If you can position yourself at the "A > B" level, you're in an excellent position to boost margins and delight customers. And maybe, if you're bright and persistent, you'll get to a Sole Source level. If you go into a negotiation in the sole source position -- sales are good, margins are good, and Life is Good!