Selling Value and Why It’s Important
Whenever I interview a person for a sales position, I ask the same question,” How do you define value?” 99% of the time, I get the same response that usually goes something like this, “Value is what the buyer or customer perceives when a salesperson shows all of the benefits of their product or service and offer it at a lower price point.” My reply to them is usually something like, ” You just gave me the definition for discounting, not value.”
Most people who are in sales need help understanding what value means. Most salespeople want to get right to the point, sell the benefits of their product and service and start negotiating over price. In the world of home watch, the initial sales call with a homeowner goes something like this, ” Hi, I am Bob with Awesome Homewatch. We are accredited by the National Home Watch Association. We are insured and bonded. I can come to your home weekly, biweekly, or monthly and during each visit, I will perform X, Y, and Z, which will only cost you this much per visit. Here is when the objections come, and the price negotiating starts. Salespeople often want to rush the sales process or cut corners, then end up spending time dropping their price or chasing the buyer, which results in no sales and wasted time.
That is a typical approach for most salespeople, and that may work for them, and that’s ok. If your selling style works for you and it generates revenue that you are happy with, then good for you. By learning and understanding value based selling you can close more business at a higher price point.
What is Value or Customer Perceived Value?
In home watch, customer perceived value (CPV) is defined two ways. First, CPV refers to the worth or benefit that a homeowner perceives they will receive from using your company to watch over their property. Benefits can include functional benefits, such your services’ ability to solve a problem or meet a specific need, as well as emotional benefits, such as the product’s ability to make the customer feel good about themselves or enhance their social status.
Second, CPV is also what the homeowner perceives will happen if they don’t hire you for your services. For example, “Bob seems to know a lot about home watch and his pricing is a little higher than others, but if we don’t use his company to watch our home, the overhead for our investment property could go up as well as our risk.” I would hope that you tour the property before offering up any pricing. During that tour, you will educate the homeowner about some of the obvious issues as well as those that may be obscure. If you do this correctly by educating and asking the right questions, the homeowner will feel confident in your knowledge and expertise and perceive that they don’t have a choice but to do business with you.
In conclusion, customer perceived value is a critical concept in sales that refers to the worth or benefit that a customer perceives they will receive from your service. It is a subjective evaluation that can vary from one homeowner to another based on their unique needs, preferences, and experiences. Understanding homeowners’ perceived value is essential for home watch businesses to attract and retain customers, differentiate themselves from their competitors, and gain a competitive advantage in their marketplace.
In the next article, I will go into more detail about the sales process, and selling value. In the mean time, don’t rush the sales process. Slow down and you will sell faster and make more money.