Decoding Level 4 Value Creation to Attain Customer Relationships That Reflect Trust and Profit
Globally, salespeople from every sphere and domain of businesses have numerous hindrances that they come across in their daily professional lives. When all these hindrances integrate themselves at various levels their targets have a negative impact which, in turn, reflects on poor margins. And, this is a snowballing effect that ends with dropping numbers of revenue and RoI. Internet has made the world a global village and pricing is the most influential factor these days in terms of purchase decisions.
To overcome these modern-day hindrances, there is a 4-tier or 4-level value creation model with which salespeople can win more clients and get their margins back on track. The idea is about value-addition in ways that it leads to differentiation and epitomizes price. To begin with, it is time for businesses to drop the conventional sales strategies and value creation models. Why? Simple, they are dysfunctional in the present era where buyers are more aware than they have ever been. Even the old skill sets of salespeople need to be revamped to develop newer and smarter skills.
Here is an overview of the 4 levels, their respective importance, and why the 4th level is what businesses should strive for because that is the level where your customer becomes your partner for life.
Level 1: Sales that are product-oriented
This level of value creation is the most basic client relationship. Though it is a basic for all sales teams, it is not quite sophisticated for the landscape of sales in the modern era. But the issue is that many sales teams get stuck at this very level and find it increasingly difficult to move further into the other levels. For Level 1 value creation, the basic skill set is just about identifying prospects, making them aware about your product or service, and closing the deal.
The gains of this level are very short-term for your longer goal of creating valuable relationship with your customers such that the value is mutual. At this level, customers are just buying from you because you are offering something that is undifferentiated and available at a price which is competitive in the market. If you ponder deeper, you will realize that at this level, you are hardly into any sort of relationship with your customers. They just purchased from you but at no stage can you state that you have their loyalty or advocacy.
This is where you go one up – get to Level 2
Level 2: Sales driven by experience
While at the 2nd level or Level 2 of value creation, the sales skill sets remain the same as that of Level 1. The differentiator here is that the relationship you forge is on the basis of transaction. It means that you have provided a brilliant customer experience. But that experience may well be only a reaction of your sales team. For instance, a customer reaches out to you with an issue and your reaction is to get it fixed. Sure you fixed the issue but on a hindsight, you did not fix any issues pertaining to your business. This level of value creation can work alright in a B2C space but when it comes to the B2B space, you have not actually added any value to your customer relationship.
Level 3: Results of business
Level 3 of value creation is certainly a leap forward. Apart from the skill sets from Level 1 and 1, this level means that your sales team has somewhat aced the skills of diagnosis, differentiation, and negotiation. Therefore, you have opened up newer avenues for you to create value by being proactive with your service. It is about identifying the problems your customers would face in advance which in return helps you prevent these problems as you have potentially anticipated them.
Level 3 might sound profound and you might feel that this is just your perfect sales world. But no! This level has its own cons. Though you are now a preferred service provider of your customer and your ROI numbers look good too, the Level 3 value creation in a customer relationship is restricted to a position that can be best described as – status quo. Because of this, your customers are bound to get disappointed sooner or later, putting your relation with them at risk consistently.
Level 4: Customer becomes your partner
Now, here we come to the level which is critical for all businesses to achieve if they want a seamless relationship with their customers, have their loyalty, and in essence, make them your strategic partners. This is the level that sales teams must consider as the pinnacle of their sales skills. The skills for this level are inclusive of the skills from the previous three levels. However, the indispensable expertise at this level is business or financial acumen, accountability, leadership, and change management.
Level 4 of value creation is a cut above the other three levels. It revolves around the establishment and maintenance of a relationship of depth with not just the customers but also with all the internal stakeholders of the organization. At this level, the sales team is an invaluable resource to every interface between your customer and your business, and that extends till the CEO. The salespeople who excel at this level are an integral part of a company’s organizational structure.
To get to the Level 4 of value creation, you got to be extremely proactive and stay ahead of the game constantly by proper anticipation of customer needs and the solutions for the same. Strategizing has to be the sales agenda at this level. A customer of yours at this level, looks up to you for taking them through to their future need analysis. At Level 3, such a relation is not quite feasible to maintain.
In lines of the business or financial acumen required for this level, a deep perspective of concepts and accounts comes in very handy. The shortfall sometimes is the ability to take that perspective into value, or how a solution for a particular issue in business is communicated in terms of the performance metrics and KPIs that cater to requirements of the key decision makers in their endeavor of keeping up with promises that the organization’s mission and vision reflect.
If the salespeople in your organization are only focused on ‘mere selling’, they in all probability, are never moving beyond Level 1 or Level 2. But with the B2B landscape evolving at pace, customers need more and demand more. The process always start with communicating with a prospect. Thereafter, creation or subtraction of value takes place when you have a face-to-face meeting with your prospect. That is where your sales team need to locate for making a shift between levels and try and achieve the ultimate level – Level 4. That is when your customer becomes an integral part of your business strategies.
At Customer Growth Summit CGS Keynote 3, join Anthony Iannarino, one of the top 25 most influential speaker on sales leadership and a sales team enabler in his session ‘Level 4 Value Creation: How to Create & Sustain Profitable Relationships of Value’. Know the framework for becoming a Level 4 Value Creator – know how to become your client’s trusted advisor by learning the 4 relationship attributes and the 3 economic outcomes to creating an unassailable preference for you and your company. Learn the new approach to sales that gives you new strategies and tactics to implement immediately. The learning focuses on creating more value throughout the entire sales process, generating more opportunities, converting those opportunities to wins at a higher margin, and to increase wallet share within existing clients.
Discover answers for true differentiated and lasting sales growth, leveraging a treasure of untapped opportunity with your existing customers. Join 7 WORLD-CLASS sales experts as they bring you strategies to help you become a trusted authority, distinct from your competition and double your profitability with consistent repeatable sales immediately at the Park Lane Hotel on November 16-17. How do you double or triple the sales growth from your existing customers while retaining more of them and becoming a true trusted authority? Find out more at Customer Growth Summit. Save 20% with promo code MTA20
