The Meaning of Value
by Ed Brodow
my Negotiation Boot Camp® seminars, one of the major
negotiation learning points for salespeople is to shift the focus from
price to value. We know that the buyer wants a lower price. But if the
seller can provide value, then the buyer will pay more. Value is the key
to sales negotiation. But we tend to be cavalier in the way we use the
word value. What do we mean when we say, "Sell Value!"
Value is the perception by the buyer that a problem has been solved.
Every buying decision revolves around a problem that the buyer must solve.
A problem means the buyer has a need that is not being fulfilled. For
example, you are hungry. You have a needhungerthat is not
being met. How do you solve that problem? You buy food. The value of food
is that it solves the problem posed by your hunger.
In order to take the focus off of price, the seller must:
1. Determine what problem the buyer is attempting to solve.
2. Provide the solution to the buyer's problem. The value of the
seller's solution is that it solves the buyer's problem and fulfills a
need. The more that is at stake for the buyer, the greater the perceived
3. Differentiate the seller's solution from the solutions proposed
by competitors. It is not enough to have a solution. It must be the
best solution, and it must be different. If all the sellers have
the same solution, then the buyer can simply choose the least expensive
provider. But if your solution can stand out from the crowd, you can get
away with charging more for your product or service. The buyer will happily
pay a premium for your unique solution.
Notice that all reference has been to the solution of the buyer's problem,
not to the seller's product or service. The reason: You are not selling
a product or service, you are selling a solution. The buyer does not
care about your product or service. The buyer is interested in one thing
only: Solving the problem. What this means is that sellers must distinguish
between features and benefits (value). A feature describes a characteristic
of your product or service. A benefit is what the product/service does
for the buyer, i.e., how your product/service provides the solution to
the buyer's problem. Features are important to sellers, but benefits are
important to buyers.
The last point I want to make is that value exists only to the extent
that it is perceived by the buyer. If the buyer does not understand
how your solution works, it has no value. Conversely, if the buyer perceives
value, it can be said to exist even if the seller's solution is second-rate.
So if you are the salesperson with the best solution you can still lose
the sale if the buyer perceives that your competitor's solution is superior.
The buyer's perception is what it's all about.
Ed Brodow is a keynote speaker and negotiation guru on PBS, ABC News, Fox News,
and Inside Edition. He is the author of Negotiation Boot Camp:
How to Resolve Conflict, Satisfy Customers, and Make Better Deals. For
more information on his keynotes and seminars, call 831-372-7270, e-mail firstname.lastname@example.org,
and visit Brodow.com.
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