First Call --- Last Look

A former colleague of mind was fond of quoting what he considered "less competent" sales people who claim--- "My customers don't give last looks."
His response; "Well, that just means someone else is getting it - Batman!"

I really love that quote. Unfortunately it doesn't go far enough. The real question is what do you do when you get last look? Do you automatically match the low price? Unfortunately, that is the first response of most sales people. In fact, it is often the first response of many managers.
The real test is how you maintain the business at a price that is profitable, acceptable and meets your margin objectives. Can you sell the customer at a higher price when he has a lower priced quote staring him in the face? Can your sales people look the customer in the eye and explain why and how your price is the lowest cost. Can they explain the multiple value propositions offered by your company that create a lower cost transaction? The key to all of this is simply --- you have to walk the walk. You can't just spout off about world class service and other trite marketing clichés; you have to demonstrate your ability to walk the talk. Otherwise, the customer will simply think --- So What!

That's exactly what most customers think when you share a weak value proposition using marketing glitz and buzz words like "world class service". They've heard lines like that a million times before and rarely believe it. Besides, you haven't shared what's in it for them - and that's all customers care about. In today's tough economy, you need to have a strong value proposition to break through the economic market turbulence to get their attention. That means you need a financially oriented value proposition that speaks to critical issues facing their company. You need factual numbers or percentages to get the decision maker's attention even faster; facts that address your customer's pain.

I once had a customer tell me that a miniscule 1% reduction in scrap costs would put me at the top of their list of primary suppliers. One percent may seem like a small number but remember everything is relative. In this case, a one percent reduction in scrap amounted at annual savings of $600,000. Every penny of savings goes to the bottom line. Think about that.
Strong value propositions deliver tangible results such as:

• Increased revenues
• Faster time to market
• Decreased costs
• Improved operational efficiency
• Increased market share
• Decreased employee turnover
• Improved customer retention levels

So how does your value proposition look? Can you describe what you do in terms of tangible results? Being very personable and developing relationship equity is not enough to capitalize on the "Last Look" and maximize sales effectiveness.

Last Look Plus

The "A" player sales person focuses more time and creativity on the right customers. They are able to help those customers do their job better and add money to the bottom line. This incremental profit generation will in turn support "Last-Look Plus". "Last-Look Plus" is the ability to get the price your company deserves for the value you provide --- once you get the last look.

Market driven companies spend time and effort consciously influencing the way they are perceived by customers, prospects, and other stakeholders. The quickest way to destroy this process is to remain excessively concerned with how much can be sold to the customer or how difficult the customer is or how much paperwork is involved. The focus must be on your Value Propositions that solve the customer's problems.
This is not a new concept. It has been around a long time. However, I believe it is the most confusing if not misunderstood concept in sales today. If you are not clear on what your value propositions are then you need to get together with your sales force and develop this concept.

Create a Brainstorming Session

Review your marketing and sales material and what you say to customers to try to get their attention. Emphasize the question --- "So What?" for every concept, feature, benefit or core competency that you discuss.
• So what if it's an efficient system? What does that do for the customer?
• So what if you have a great reputation? What does that do for the customer?
• So what if you believe you have world class service? What does that do for the customer?
By asking this question over and over again, you'll get much closer to the real value you bring to customers.

Don't forget to Listen to Your Customers

Your existing customers are your best resource to find out what value you bring to the table. Tell your customer you need help understanding the real value of your offering and you'd like a chance to learn their perspective. Don't rely solely on the feedback you get from your sales people. Create some customer focus group discussions.

Value propositions come in many shapes and sizes. They have many names. Some of you may recognize them by the term "unique selling points". Others may call them your elevator speech and some marketers may say they are your positioning statements. None of that matters. What really matters is the perceived value of you as a company in the mind of your customers.

You see, "Perceived Value" drives customer expectations. Performance Value drives customer satisfaction. The higher you raise the perceived value of you as a supplier, the closer you come to creating competitive advantage. Caution.... Be careful not to raise this perceived value so high that you can't perform up to expectations. That's like shooting yourself in the foot. If you create competitive advantage you should have no problem getting the "Last Look" but more importantly you will be able to get a fair price for the value you provide without having to meet the lowest price of the dumbest competitor.

Value Propositions --- You Have More Than One

I use the plural term, "value propositions" simply because there is more than one value proposition in every company and every transaction.
• The value that your company provides. This is an opportunity for you to talk about your company in terms of what the company stands for, how it partners, how it has produced for others, and how the company serves others.
• The value your product or service provides. The best way to present product value is through the technique known as "similar situations." This gives you the opportunity to talk about how your product or service has performed successfully in other environments. This is not just about features and benefits.
• The value that (the salesperson) provides. If you understand that the first sale is about you, the salesperson (the first sale that's made is you), then you can understand the impact that this piece of the value proposition can play. If you bring no value to the table, your price will dominate the discussion and the outcome.

You must be able to express these value propositions in terms of profit generation or cost reduction in the eyes of the customer.

It is essential that there must be some form of interest or perceived value on the part of your customer. The value proposition can't be some mission - vision mumbo jumbo that sounds wonderful from a journalistic standpoint. It must validate the value that helps your customer produce more, benefit from, and/or profit from or satisfy a need.
That is the most critical component of your value propositions and yet it is often ignored by sales professionals; in spite of the fact that it creates the most effective engagements with the customer. And.... this is what the customer is the most interested in. Your value propositions must include:
• Continuing Value after the Sale.
• A Relationship not a Transaction
• A Partnership - Mutually Beneficial
• World Class Service & Support

If value propositions are created and used properly, they can eliminate or reduce competition. They create situational proponents that can make you the only choice --- first call and last look or "only call."
The Concept is Simple
Successful Value Propositions are simply addressing the reasons why a customer should buy your products, from your company, represented by your sales people. It becomes a focus on your differentiation from your competition. More precisely, it answers the question of why a customer should choose your product, your services and your company and give you first call and last look.
More importantly, when you get that "First Call and Last Look" you won't panic and automatically assume that you must meet the lowest price.