Mistaking Price For Value

A couple of months ago, I wrote about how salespeople fear being replaced by machines.  I said they should not worry.  I made an analogy with the market for financial investments, where highly compensated salespeople sell "commoditized" financial instruments like stocks and bonds whose price is set on exchanges. 

This analogy breaks down for many media salespeople because they are armed with so little information of value to their prospects.  Too many of these salespeople really have nothing to bring to the client other than price.  Media companies need to equip and train their sales staff to sell value, not price.

In the stockbroker analogy, brokerage firms pump out reams of proprietary research for their salespeople to use to discuss the possible future value of an investment.  The brokerage research departments produce both industrywide and specific stock analysis and projections.  Research departments are considered the glittering assets of financial companies.  Merrill Lynch would never send its brokers to work promoting commodity research that everyone has access to.  Why would I talk to a Merrill Lynch broker if I can get the same research and market analysis from eTrade?  I wouldn't.



This principle applies to advertising-supported media companies of all kinds.  Many media companies give their salespeople no research at all. Other media companies provide only the commodity research that the client and agency already have access to, such as Nielsen for TV or Internet, MRI or Simmons  or  Monroe Mendolshon for print, Arbitron for radio and so on.  Yes, for some small advertisers this information is more than they have before the salespeople visit.  But the bigger, more valuable and sophisticated clients already have access to these syndicated research studies.  This is like a Merrill Lynch broker coming to me to show me research from Morningstar Research or Value Line reports that I can get at the public library, if I don't want to spend $500 bucks a year to subscribe. 

Arm your salespeople with insight and research that is unique and that adds value for the client, adding to their understanding of their own markets, and you will be building relationships.  On those relationships you will build sales.

We are in an age with immediately quantifiable results of Internet delivered advertising.  Big advertisers sometimes have proprietary follow-up research to assess the effectiveness of their advertising immediately.  It may be econometrics, like what MasterCard and Visa use to correlate every credit or debit card swiped to their ad campaign. It may be based on grocery scanner data or IMS data on prescriptions written.  Or it may be pre-and-post campaign surveying.  Even a little guy like me can start an ad campaign this morning to drive traffic to my website, and check this evening how many potential customers visited and how many emailed me asking for a quote. 

With all the data available, it should be obvious that similar advertisers running similar campaigns achieve different results -- sometimes from the same media choices.  But since all this data on results is privately held and considered trade secrets, we don't have access to genuinely comparable information.  And the research and case studies that are available invariably only show the good, not the failures.  So the wide variations in value between two different advertisers from the same media choices are obscured. 

But value is what we sell.  It should be increasingly obvious that advertisers don't need salespeople to determine the price of a page or a spot or a banner impression.  Increasingly, exchanges will do that.  But the value of the page or banner or spot is what the advertiser want -- and presumably there is a difference between the value and the price, or advertisers would never advertise.

All of this brings us to the core problem of sales.  How can salespeople sell effectively when all the buyers want to know is what the price is, rather then what the value might be?  How can salespeople penetrate the front line of media buyers asking for their RFPs to be filled in?  They are saying, just give me the price!  And invariably these front-line buyers want to be treated as decision-makers.  But we know they are only deciding what to recommend, and they want to recommend what they believe their boss or their client will approve. 

We know we need to call on the higher-ups.  Be it the media supervisors, the media directors or clients who they work for, it is critical that sales people sell at the level from which influence flows.  But getting those meetings to talk about price won't work.  To sell value, you must bring value  -- in the form of perspective and research clients can't get from anyone else.

Advertisers know that their market is constantly changing.  Customer needs are changing, distribution is changing, the competition is changing, and how customers take in information is changing.  Your clients will always be interested in new perspective and data that will help them understand and adapt to the changes.  That is the value salespeople bring to the relationship.  Quoting the price provides no value.  Are you arming your salespeople with value other than price or commodity research?

2 comments about "Mistaking Price For Value ".
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  1. Kenn Kozerski from, May 13, 2010 at 10:48 a.m.

    discipline is required of the sales person, who sees the sale in front of him and all the client wants is price. If the price is not right, no sale. Upsell value and and downplay price and if the value to the client outweighs the price....done deal.

    Like this...will this be shared on FB?

  2. Paula Lynn from Who Else Unlimited, May 13, 2010 at 10:55 a.m.

    Are the instructors qualified in the specific subject matter for which they were hired? Caveat outsourced companies.

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