WHY YOUR VALUE TRANSCENDS YOUR WORK
By Tim Williams, Ignition Consulting Group
When sitting face to face with the buyers of your services, remember you’re not just selling the value of the work you create. The value your firm brings to the table is deep and multifaceted. But don’t count on your client to point them out for you.
Your prospective clients are likely to oversimply and overlook the rich value you have to offer, because that’s what professional buyers are trained to do. Their focus is to define your services as “costs,” and make them as comparable to other firms as possible. So they pretend not only that one “deliverable” is as good as another (conclusively untrue in knowledge work), but that the “deliverable” is all they are buying.
The job of the professional seller is to surface all the other forms of value your client should be considering. Unfortunately, most firms default to providing a staffing plan or schedule of hourly rates. In this way, “Agencies do half of procurement’s work by commoditizing themselves,” says former P&G procurement executive John Gleason.
Some dimensions of value may be obvious but are still hugely valuable — not just figuratively, but monetarily. For example:
- Is a project that’s delivered late just as valuable as one delivered on time?
- Is a firm that neglects to promptly return client calls as valuable as another, even if their work is judged to be similar?
- Is a firm populated with junior order-taker client service people just as valuable as one that has consultant-level talent on the front lines?
Some argue these features are too soft to make a difference in a price negotiation, but these varieties of value are often the very things that can justify your price. In describing the “new role of procurement,” at a recent conference, Coca-Cola’s Chief Procurement Officer, Christina Ruggiero, said her company is now focused on looking at value in a more holistic way. She believes the conversation with agencies needs to move beyond “fees and rates” to what she calls “total value creation,” including such value factors as speed to market, innovation, and new technology.
Increasing performance or reducing risk
Economists teach that basic value is created either by increasing the buyer’s performance in the market or by decreasing the buyer’s risk. Certainly, the work you create for your clients is designed to improve marketplace results. But beyond these deliverables, agencies can add considerable value to a client’s business through such things as faster production, faster ramp-up time, or 24-hour access to services.
Imagine a section in your next RFP response or new business presentation titled “How we help lower your costs of doing business” that outlines the specific ways your firm:
- Ensures superior project management
- Makes progressive use of the latest technologies
- Utilizes customized client communication platforms
- Employs a watertight quality assurance process
- Optimizes work through state-of-the-art analytics
The most convincing way you can reduce your clients’ risk is to offer a professional service guarantee. You’ll be among the few progressive firms that promise a refund of fees if the service provided doesn’t match the client’s expectations. The British agency Brainjuicer takes this concept one step further by guaranteeing a level of ROI in each client engagement.
Uncovering rich value
Consider the immense amount of effort you and your colleagues devote to understanding your costs. You pore over financial reports, scour expense budgets, and meticulously scrutinize the costs of producing a project or serving a client. Now imagine devoting the same energy to identifying, dissecting, and describing the layers of value you provide in your client relationships. This value can be direct or indirect; tangible or intangible. Even if some of these factors never appear on a proposal, they will contribute immensely to your self-confidence and sense of value in pricing discussions with a prospect.
Don’t try to demonstrate your value by providing procurement with a spreadsheet. Not only is this a lazy approach (Clayton Christen calls spreadsheets the “fast food” of modern business), but it makes the assumption that all value worth paying for is quantitative. The dimensions of your value can be communicated much more effectively visually. Consider a mind map, an infographic, or another visualization technique that can help bring your value to life.
Many firms do a fine job of creating value, but a terrible job of communicating it. It’s ironic to consider that most advertising agencies — creators of brilliant communications strategies — have this trait. Even restaurants do this better that most professional firms because they understand that the value of a meal isn’t just the quality of the food. Many other factors go into a customer’s willingness to pay what the restaurant is charging.
Above all, remember that we sell to people, not companies. Humans, not institutions. Value in a buyer-seller relationship can be both rational and emotional. Economic and psychological. With each new business opportunity, consider the question “How does this particular customer define value?” Then structure your proposal, your pricing, and your presentation to showcase the multifaceted ways in which your firm delivers much more value than the firm down the street or across the globe.