Consultative selling is becoming the go-to best practice for many businesses in many industries. But is it really the best option when compared to other types of selling?
Taking a consultative approach can be time-consuming and limit sales teams’ ability to focus on reaching large numbers of potential customers. To ensure you are getting the best return on the time you invest, you need to consider whether consulting your potential customers is really the right option for you.
In this article, we take a look at the data and what it tells us about whether consultative selling is really worth it.
What is Consultative Selling?
Before we go on to explore the arguments for using consultative selling, let’s define exactly what we mean by the term:
“Consultative selling is a sales approach that prioritizes relationships and open dialogue to identify and provide solutions to a customer’s needs. It is hyper-focused on the customer, rather than the product being sold” – Richardson
Taking a customer-first approach relies on salespeople working to help potential customers overcome challenges and educate them on potential solutions.
Consultative selling is very different when compared to product-based selling.
- Focuses on the direct benefits and features of a product
- Sources all value from the product
- The salesperson’s role is to communicate product information
- Relies on high-volume, low-value accounts
- Focuses on short-term, immediate wins
- Focuses on the value of the product and company as a whole
- The salesperson’s role is to provide value and advice, often outside of company specialization
- Relies on a smaller number of customer spending more
- Focuses on building long-term relationships for continued success.
Why is Consultative Selling Better?
When you look at the features of consultative vs product-based selling as laid out above, it can appear damning on the product-based approach. The truth of the matter is that neither is better than the other. Each is suited to different circumstances.
For example, businesses that manufacture cheap, mass-produced products are not likely to benefit from the time investment of consultative selling. On the other hand, a luxury yacht salesperson would benefit highly from building strong, long-term relationships with their clients.
There are many benefits to consultative selling, whether these benefits are right for your business will depend on your circumstances. These benefits include:
- Developing customer trust
- Opening lines of communication
- Driving loyalty and future purchases
We explore some of these benefits and look at the data below.
Develop Customer Trust
Increasingly, both businesses and consumers are seeking out brands that they feel they can trust. As prices rise there is less room for error when making buying decisions, therefore your customers need to know they can trust that your product or service will meet their needs.
Aligning values with the businesses they do business with is also becoming more important in buying decisions. One study showed that 81% of those surveyed said that trusting a brand to do what is right plays a big part in their decision to purchase.
Consultative selling allows you to communicate and demonstrate company values, as well as educate customers on what your products and services will help them achieve, setting expectations, and developing trust.
Open Lines of Communication
Product-based selling tends to rely on the broadcast of information from the salesperson to the customer. Consultative selling opens up a line of communication between the two, letting the customer explain their wants and needs and letting the salesperson help them find the best product or service to meet them.
Data suggests that around half of once-loyal customers have moved their business to a competitor who was able to stay relevant and better satisfy their needs.
Drive Future Purchases
When salespeople focus on selling based on the merits of a product or service it leaves them vulnerable to future change. For example, if you sell a product specifically on a certain feature, if that feature is removed in future versions you will likely lose customers and have to start the sales process again.
If you take a consultative approach you are selling yourself, your business, and your interest in helping the customer meet their needs. Once this is done successfully, customers will know you are acting with their best intentions in mind, making it much easier to convince them of the benefits of product or service updates.
Using consultative selling to maintain long-term relationships with customers is highly beneficial to businesses. Studies have shown that finding and bringing new customers on board can be 5 times more expensive than keeping current ones.
The Consultative Selling Edge
If you believe that your customers could be better educated in your area of expertise, taking a consultative approach would likely work well for you.
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