Several years ago I shared my thoughts on a crucial distinction in the B2B sales process. Simply, are you making a freedom sale or a capability sale?
In a freedom sale, you’re providing a solution that your customer already has in place. In essence, your solution frees your customer from having to worry about the issue. The fundamental proposition in a freedom sale is that you’re going to be able provide the solution better, faster and cheaper than how it is currently being handled.
A capability sale on the other hand offers to provide a solution that enables your customer to do something they currently can’t do. The underlying proposition of a capability sale is comprised of the value that your capability can provide your customer.
With a freedom sale the focus is on, “what does it cost?” With a capability sale the focus is on, “what is it worth?” If you’re company is focused on increasing margins, it’s a pretty good bet that you’re going to need to be making a capability sale.
The most common mistake I see B2B companies make lies in the attempt to make a capability sale by following the freedom sale playbook. The salesperson sells the solution as if the customer understands what the solution will do, and, by extension, what it’s worth.
When making a capability sale, your first job is to enable your customer to understand that:
a) They don’t currently have the capability you possess
b) The opportunity cost of the capability
It is important that you establish this early in the sales cycle. Here are three questions you want to be asking early in the process:
How do you currently address [the problem that you solve]?
It’s a pretty good bet that if the customer is worthy of you targeting them, they’re doing something right. While you may believe it’s obvious that they’re not addressing a problem, they’re probably not fully aware of it.
Asking this question not only informs you about their status quo, it educates the customer about their business. Make sure you’re asking effective follow up questions, and in a short amount of time your customer will be explaining that they are not fully (or partially) addressing the problem you’re focused on.
How are [the answers to the previous question] impacting your business [or the specific objective/initiative you are discussing]?
Make sure you shut up and listen. If your customer seems confused or stumped, you can explain what you’re asking, but under no circumstance should you broaden or change the question. If they’re perplexed, it’s probably because they’re thinking and grappling with the issue.
Consider people don’t spend much time thinking about problems they don’t fully understand or know they have. Your previous question highlighted a new issue that has allowed them to become aware. Now your job is to help them understand the impact.
Remember too that they’ll probably show a fair degree of discomfort. It’s the pain of consequence that they’re feeling. It’s totally natural for the customer to try to push away from the issue. Don’t let them. Ask your follow up questions. Empathize with them and demonstrate the leadership that they can share the impacts with you.
What types and levels of resources are you currently allocating towards [the problem/issues you are discussing]?
While this question “rhymes” with the budget question, it’s not the budget question. What you’re looking for here is the level to which a customer is currently addressing the issue. The answer is valuable for two reasons:
- It makes it clear just how big a sale you are making.
- It helps you understand just how serious they are about solving a problem.
For example, today I was talking with a prospect who was telling me about their desire to reposition their current go-to-market approach. I asked them this question and they told me about the actions and investments they are currently making.
As I learned this, it became clear they were making about 1/3rd of the investment they needed to make. In answering the question, my prospect admitted that he knew they weren’t doing enough.
Now, my job is clear. I need to demonstrate that their inability to grow sales predictably, sustainably and scalably is big enough to justify tripling their investment in growth. The moment I don’t believe that is probable is the moment I should eliminate myself from competition and find a new opportunity.