There comes a time when we realise that amidst change we cannot keep living the old way, doing the same old things expecting different outcomes.
This time has come for product selling. Product or transactional selling, especially in B2B and complex B2C, is now obsolete.
However, the amount of product companies now finding they are rapidly losing margins and being reduced to commodity traders is staggering. We have the makings of a perfect storm where customers are taking full advantage of these conditions at the expense of the product companies.
Many product companies have fallen prey to the ‘race to the bottom’ mentality where many large customers, like sharks, are circling those who are weak and anaemic because they have not changed their selling ways and cannot position themselves beyond selling product and price.
All sorts of companies are being affected, including high end research-based companies who have prided themselves on selling high end, innovative products at healthy margins which they can use to fund more research. Even they are finding that their products are behaving like commodities with Me2 products of similar standards at cheaper prices competing on the same footing. Coupled with this, these high end product research companies, sadly, have been giving away for free their technical knowledge and expertise for years. Remember, if you give it away for nothing it is worth nothing.
No one is immune if we cannot sell beyond product and price.
Yet the signs have been around for more than 20 years indicating that tactical product selling has been on the way out. We are also seeing traditional professional services firms and consulting businesses being affected with their bread and butter work such as year-end tax returns, etc, being automated or off-shored thus leaving revenue holes in once stable business models.
Today, we are seeing a new type of business with a new type of sales team emerging – The hybrid business and hybrid sales team.
Smart businesses are recognising that if they are to achieve sales revenue targets that also have healthy margins they need to combine both consulting capability with product capability. Smart product companies have transitioned to offering consulting services where the products are only part of the sale and smart consulting businesses have productised; automated their ‘bread and butter’ work creating new and different revenue streams.
Enter the hybrid sales team and the hybrid sales professional.
Hybrid sales teams are trained to understand how businesses work and how what they offer adds real, tangible value to a complex value chain. Hybrid sales teams can see the bigger picture and work as ‘worldly’ business consultants who also have specific knowledge around their areas of expertise.
They are able to converse with anyone up or down the client’s value chain pitching their conversations at the right level. They factor in business performance and productivity, and can create and map solutions that solve challenging issues and/or create new viable opportunities. More specifically, hybrid salespeople consult, identify and determine client priorities, understand how they can work with various problems, challenges and opportunities and create viable solutions for their clients and their own business. They demonstrate real points of difference and value and are prepared to dive deeply into working with their clients and their own business.
Call this type of selling ‘insight selling’, ‘challenger selling’, ‘value based selling’, ‘perspective selling’ or whatever other name you can think of, it all revolves around the core concept of solution selling.
If we as salespeople, sales leaders and business leaders want to avoid this perfect storm and prevent our businesses from being dragged into the ‘race to the bottom’, and if we want healthy margins and healthy client relationships where we are able to do good business, we must look beyond selling product features and benefits and become hybrid sales teams.
The only other choices left are to become commodities businesses selling at the cheapest price, or downsize and only do bespoke consulting, or go out of business all together. That’s it.
If you want to give your salespeople insights into how business works and develop their business and commercial acumen without having to do an MBA, talk to us at Barrett about running the sales professional and CEO program which teaches people about how businesses work, what good CEOs need to do to lead profitable and effective businesses.