When sports teams are on a losing streak, the manager’s solution is often to fire the coach. Unfortunately, that practice is common in business as well: When a company’s revenues aren’t growing satisfactorily, the CEO’s solution is often to fire the VP of sales. But the VP usually isn’t the problem – and neither are any of the other things that companies try to “fix” when revenues aren’t growing, says Robert Kear, chief marketing officer of Sales Performance International (www.spisales.com).
For instance, it’s common for organizations to think they need to “fix” the sales force, or start selling “solutions” instead of products when there’s a growth problem. But the real problem says Kear, is that there’s a value perception gap – a fundamental disconnect between your value proposition and the value perception of the customer. And the way to close that gap is to look at the six typical reasons for it. These reasons vary from strategic to tactical and companies may have problems only in one area or several. By making a careful assessment of each of these areas and targeting those that are weakest, you’ll begin to close the value perception gap with science rather than guesswork. Here are the six typical causes of a value perception gap:
1. Companies aren’t doing a good job of creating a link between the market’s problem and how their solution addresses that problem. This value framework and messaging issue is defined by the lack of rigorous problem/solution mapping, lack of a rigorous differentiation model and messaging that is not aligned with customer problems and needs.
2. Segmentation and channels aren’t calibrated with the value proposition. In other words, even if you are doing a good job of drawing a link between the market’s problem and how your solution addresses that problem, you may not be using the right channels to deliver that message. This “Go-To-Market approach” problem is defined by segmentation that is not aligned with problems and needs addressed, and the sales channel lacking the fluency to cultivate leads.
3. Marketing communications aren’t aligned with sales conversations, which is why 70 to 80 percent of marketing materials aren’t used in most companies. This communications alignment issue manifests itself in four ways: Marketing communications propagate product messages rather than acknowledging customer problems; campaigns launch products instead of solutions to problems; leads result in product ‘tire kickers’ and fail to connect with urgent customer needs; and solution messaging is not incorporated into selling tools and job aids.
4. Lack of management and reinforcement support systems. Here, managers lack coaching and mentoring skills to help sellers prospect effectively; recruiting does not focus on problem-solving skills; and compensation is not aligned to support the solution-selling approach.
5. There’s no formal sales process alignment with the customer buying process. This problem is just what it sounds like – a company’s sales process is rooted in an academic theory unrelated to the way its customers buy.
6. There’s an absence of fundamental skills and knowledge at the individual level. Typically, limited situational fluency renders salespeople unable to cultivate leads and reps lack problem diagnosis and vision creation skills.
Once you can understand how effectively you’re performing in each of these six areas, you’re on your way to making some realistic performance improvements, says Kear. And when you close the gap, not only will your revenues grow, you’ll hear a huge sigh of relief coming from the Sales VP’s office.