It’s easy to commoditize a product – it’s almost impossible to commoditize a solution.
Sales teams in technology and healthcare markets are dealing with solutions whose value is both intangible and subjective. There’s considerable value in training your team to view the world through their client’s eyes. Consider this old fable …
A factory CEO asked a retired mechanic to fix a critical machine that no one else could get working. After looking it over for a few minutes, he marked a small chalk “X” on one component, saying, “If you replace that part, it will work.” The CEO was delighted and asked him to send an invoice.
The mechanic sent an invoice for $10,000. Shocked, the CEO asked for a breakdown – upon its return, the invoice said
Chalk . . . . . . . . . . . . . . . . . . . . . . $1
Knowing where to put it . . . . . $9,999
There are many different versions of this story, always framed around the lesson of the value of knowledge and expertise versus the value of labor.
But there’s another lesson here for sales teams – if the mechanic was really good, he’d have done two things differently;
- He’d have recognized his leverage and told the CEO that he’d be expensive, to manage expectations and avoid a dispute later, and
- He’d have asked the CEO what the daily cost to the factory of the broken machine was (in lost production, penalties, client dissatisfaction, and reputation). That number was probably many multiples of $10,000, and he might then have been able to charge even more and have the CEO happy to pay it.
Sales teams should learn to be less in love with their products, and more interested in the value they bring to each beneficiary in their client’s organizations.
Clients will happily pay good money for fixing big problems. The bigger the problem, the more they will pay. Not everything can be monetized (what price love?), but if you understand where, how and for whom your solution creates value, you’ll tend to make the price much less significant.
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