OUTCOME-BASED SELLING: WHAT DOES IT MEAN FOR PROPOSING AND NEGOTIATING?
Newsroom

OUTCOME-BASED SELLING: WHAT DOES IT MEAN FOR PROPOSING AND NEGOTIATING?

Most sellers find that determining the “right outcomes” is the biggest hurdle in outcome-based selling.  In the previous BLOG we briefly demonstrated using the Outcome Alignment Assessment tool, jointly developed with Ecosystems, to help overcome the challenges when “selling” to customer outcomes.  The challenges we addressed were:

1) Helping the customer gain internal alignment on their desired outcomes;

2) Transparently sharing those desired outcomes with the seller;

3) Sharing by the seller those potential outcomes they believe can be delivered; and finally, 4) Jointly collaborating and aligning on the “right outcomes” and success metrics the customer and seller will pursue for this opportunity.

I have written much in the past about the advantages of more transparency, collaboration and an increased focus on outcomes in B2B selling. The result is a relevant and “irresistible value proposition” – one that makes the customer sit up, take notice and become extremely interested in what we are selling. But what about the remainder of the customer journey that leads to a booked deal?  How should we “propose” to customer outcomes?  And then, how do we “negotiate” to customer outcomes?  If we sell to outcomes but then try to propose and negotiate the same ways we have in the past, the odds of booking the deal, much less delivering on the outcomes, become extremely small.

Outcome-Based Proposals:

Perhaps the biggest challenge the customer has in awarding us a deal is that our proposal does not clearly link those desired outcomes to the key elements of our offering.  Most standard proposal formats consist of products and services listings, volumes, support, pricing, discounts, etc.  Additionally, the proposal is packed with pictures, graphs, charts, diagrams and such, but it is predominantly about the seller.  We are leaving it to the customer to wade through all of that information and “connect the dots” between what we’ve proposed and the outcomes we’ve previously agreed upon.  This is a self-inflicted error.

Outcome-based proposals should accomplish three primary objectives:

1) Reinforce trust & credibility by reiterating the outcomes important to the customer;

2) Make it easy to choose us (and know it is the right choice for them) by clearly connecting each key element of our proposal to those outcomes and demonstrating how they support the outcomes; and

3) Managing uncertainty and risk by presenting the customer with options of various outcomes they might achieve. Thus, we are allowing the customer to “buy” the right outcomes for them versus us “selling” to them.  Again, we are leveraging transparency, collaboration and a focus on outcomes.

Experience has shown, clients who use this approach to outcome-based proposals consistently enjoy higher win-rates with increased deal sizes as well as shorter sales cycles.  In short, does our current proposal format and methodology support outcome-based selling, or is it part of the problem?

Outcome-Based Negotiations:

Everything we’ve accomplished to this point in the customer’s journey (outcome-based selling and outcome-based proposals) has helped us setup the “right negotiation.”  We actually want the negotiation to be based on achieving the agreed to outcomes.  After all, if the customer has agreed on the outcomes we will both produce and has further agreed on the key elements of any deal that will be necessary to produce those outcomes, a majority of the negotiation is already done!

Outcome-based negotiations are my favorite way to negotiate because, with proper preparation, they are the easiest way to negotiate. If the customer feels compelled to “change the deal” at this stage by negotiating, we let them know that is fine, but they are also changing the agreed to outcomes. We simply inform them of the impact on the outcomes those changes will make. Most times, customers soon realize they are actually negotiating with themselves and against what they want to achieve and quickly decide the outcomes are more important. Another few points of discount or a lower hourly rate are just not worth impacting those outcomes and the deal gets done. And it is generally a good deal for both parties.

Successful outcome-based selling requires that we present outcome-based proposals and that we conduct outcome-based negotiations in order to be successful. Long time readers will note that I have not touched on the topic ultimately most important to the customer, and that is actually delivering the promised outcomes after the sale – and getting credit for delivering it. With the length of this blog, that will have to be the topic for another day.

Good Selling!

Steve