How much does functionality and pricing control matter?

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David Chimenti
David Chimenti Member [Pro] Posts: 42

if you or your top salesperson could customize your product to meet any client request and they have full authority over pricing, what would you expect their close rate to be with customers that use a similar product?

How much does functionality and pricing control matter? 2 votes

100%
0%
>90%
0%
>75%
50%
Julie Brence 1 vote
>50%
50%
Elijah Friend 1 vote
<50%
0%

Comments

  • John Kaplan
    John Kaplan Member [Pro], Member [Plus] Posts: 22
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    David, a couple of questions:

    1. When you say “They have full authority over pricing” - I assume you mean the rep?
    2. When you say “similar” product, please elaborate. Is the “customize your product to meet any client request” recognized as valuable by your customer and is it part of the decision criteria?

  • David Chimenti
    David Chimenti Member [Pro] Posts: 42
    edited November 2023
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    Great questions John and I am beyond grateful that you joined the discussion. The way you talk about honoring the sales training profession always resonates so well with me.

    I wanted to leave this open a bit to different industries and see what people have to say about their own experience a bit too, but to provide clarity, let’s assume:

    1. the rep has the control and by rep I mean the person uncovering the decision criteria and aligning it with customer needs (doesn’t have to be an AE depending on the org)
    2. When I say a similar product I mean one that is purchased for the same type of utility for the end user. We could use internet as an example. You can get a plan from Spectrum, Xfinity, etc and the same internet will generally perform the same tasks (maybe even through the same cable line).

    Whoever is structuring the deal may have control over pricing, speed, delivery, as a standard process. In this scenario, they could also customize and say “I’ll throw in mobile hotspots so your team can work on the go”, build a personalized portal, or whatever solution requirement is required to achieve the positive business outcomes the customer is looking for. As such, it is safe to assume that the solution requirement added was defined by the decision criteria.

    Thank you for your time John!

  • John Kaplan
    John Kaplan Member [Pro], Member [Plus] Posts: 22
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    David, thanks for the kind words.

    I know you are looking to get feedback from different industries so I will be brief. For me, this conversation comes down to Differentiation. In order for differentiation to create a competitive advantage for us, it must add value to the customer and be defensible. In your example you state "whatever solution requirement is required to achieve the positive business outcomes". Based on this, I assume that any customization being offered is required by the customer and they see it as part of their decision criteria. If this functionality is unique (meaning only your company has it and it adds value to the customer), I would say the close rate would be very high. As you know, unique differentiation can be rare (If it successful it tends to be copied over time by our competition). So the majority of the time our differentiation is Comparative (meaning others say they can do it, but "How" you do it for your customers creates an advantage). In your example you state, "I'll throw in…". Whatever we provide to the customer has to be of value or else you don't get credit for it. At the end of the day, if a customer does not see a difference between what you are offering and what your competition is offering, then they go to the lowest common denominator which is price. Your close rate might not suffer at first but we put ourselves into a race to the bottom.

    https://www.forcemanagement.com/seller-blog/how-to-stack-customer-requirements-in-your-favor

  • David Chimenti
    David Chimenti Member [Pro] Posts: 42
    edited November 2023
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    John, thank you so much for your time on this. We are actually in alignment on most all of that.

    I would think that the close rate would be very high too. The one area where I would say we saw it differently was surrounding top competitions reaction to it. You are absolutely correct that they’ll usually replicate it, but in this example those companies don’t care to meet the customization needs because of a bigger market to target with their offering. The result of this is that the decision criteria have generally been built on safe decisions and what’s easy to approve because it checks the correct boxes for what the perceived decision criteria should be and not what will necessarily benefit the business.

    So unique differentiators are in play but have some limitations based on capabilities that are limited by CRM partners in the space.


    In summary, I think with that latitude the salesperson should be able to move the goalposts and anchor their deals in ways that keep the less cooperative competitors at bay. It would require learning specific initiatives/criteria for specific stakeholders, which is more work, but should definitely close more.

    And John, those weren’t just nice words. I take sales training seriously as a profession. I have seen the great things that happen when trainers honor it and the mess it creates when they don’t. Thank you for your service to the sales community in general.