Inside Sales Telesales Tips Blog

5 great steps to selling a Commodity: Differentiate it like it’s not a Commodity

  

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One of my inside sales training customers sells a common item that is also sold by hundreds of other suppliers in the marketplace. I won’t tell you what it is, but you’ve got one of them at your desk, right in front of you. If you’re selling something where competition is fierce and heavy price negotiation is common, this post is for you. 

In a commodity sale, prospects will generally call around to multiple vendors, doing a lot of price shopping. Often, they’ll buy purely on price. So it’s important to create a differentiator as early in the conversation as possible, and position your offering as close to being a “sole source” as you can, which removes price as the sole buying motivator. I’ll give you a quick story from my own background, then give you 5 steps that are essential if you want to be above quota in your commodity-based sales situation.

I once sold a photocopier, the Royal 112. It was feature-poor. In the days when competing copiers had enlargement and reduction capability, the 112 had none. In addition, it had a moving platen, which means the top moved back and forth to scan the document, rather than the mechanicals moving inside the machine. It certainly wasn’t modern technology, and I was at a tremendous competitive disadvantage. But the 112 had one important thing going for it. It was durable. In fact, there was a true story about a 112 being inundated with mud during a flood. Once the debris had been cleared, the owner took it to a repair ship. It was cleaned out, a new drum installed, and the damn thing worked, just like new! So when I talked with copier prospects, I chatted early-on about the reliability of their previous machines, and it turns out that 90% of them were making a change because their old copiers weren’t reliable. So I told the flood story. And more than 50% of the time, I walked away with the order. 

So back to today. My current client has a fabulous uptime statistic, best in the industry. So there’s the differentiator, in this case, reliability. They key is bringing up the differentiation factor early in the discussion, way before features and benefits are discussed. If you’re selling a commoditized item, you’ll have a differentiator, too, and you’ve got to engage the prospect in a discussion around your differentiator as early as you can, so you can position your company as a “sole source.” Here’s how to do it: 

1) Determine as early as possible what’s driving the need to change. People don’t change products unless there’s something that isn’t working right with the current solution. It could be additional features, company growth, reliability, you name it. 

2) Determine what business your prospect is in, and discuss how the product in question is used by the company to make the business run more profitably. Don’t assume you know, either. Prospects will use their own words to describe the situation, and in doing so, will actually tell you how to sell to them. 

3) Link your differentiator to the business driver and need as described by your prospect. You can say something like “I’m really glad we’re talking because [the differentiator] is exactly the reason so many people have come to us and become customers.” If you have a testimonial, mention it. 

4) Once you’ve gone through these three steps, you can begin qualifying, discussing your solution, and again linking it back to the prospect’s business. And always talk about your prospect’s business. Your differentiator could be about making the company more profitable, his or her customers being happier, or anything that mirrors what the prospect told you. 

5) After you’ve finished these steps, you can ask your closing question. If you’ve done the job correctly, the prospect may just going ahead and place the order, rather than having to call around to several of the hundreds of other vendors that sell something similar to your offering. 

Sound simple? It is, and it isn’t. You’ve got to be “intelligently ignorant,” and not instantly feature-dump and blast out everything you know about your solution. You’ve got to hold back, ask the prospect questions, listen to what the prospect says, and take notes. And you’ve got to do it before going into “closing” mode. It takes patience. Prospects are in a great frame of mind to tell you about their problems early in the call, before they find out what you have. After they know about your offering, they’re a little more reticent to tell you, and they often just want to talk about price. And once they get your price, they may just go out and call someone else to see if the next vendor is lower. 

So focus on differentiation, discuss what’s driving the need for change, and sell consultatively as a sole source. If you’re selling a commodity, add "selling by differentiation" to your Best Practices Playbook.