HBR: Biggest driver of customer loyalty: Brand? Product? Service? Price? No. The sales experience…

This is the 2nd of a 4 part HBR series where the authors share the findings in a global study of 6000 top performing sales reps. (Post #1: HBR Challenger #1)

Do you remember being dragged to your SPIN sales selling training classes (Situation questions, Problem Questions, Implications Questions, Need-Payoff Questions)? These training classes have indoctrinated us to gain a deep understanding of the client need using a series of open ended questions, have the client gain acceptance that solving the need is critically important and then we pile in with the solution. “What’s keeping you up at night?” – – was one of the well worn ice breakers used to get there. The authors argue that “this approach is based on a deeply flawed assumption: customers actually know what they need in the first place.”

They conclude that the largest driver of customer loyalty is the sales experience (53%) and not Product or Service (19%), Brand (19%) or Price (9%).

Several of the key drivers of the sales experience include: Rep offers unique and valuable perspectives, Rep helps me navigate alternatives, Rep helps me avoid landmines and Rep educates me on new issues and outcomes.

“Customer loyalty, it turns out, is more a function of how you sell than what you sell.”

Great article on the value of consultative selling. You’ll find some key excerpts below.

“But what if customers don’t know what they need? What if customers’ single greatest need, ironically, is to figure out exactly what they need? If this were true, the better sales technique might be to tell customers what they need. High-performing reps (Challengers) succeed by doing just this, revealing to customers problems — and solutions — that they don’t even see. This isn’t your standard solution-selling approach, focused on open-ended needs diagnosis.

“A sales conversation with a Challenger provides valuable insight to customers instead of extracting it.”

“The key is to teach in a way that leads customers to your unique benefits as opposed to leading with them.”

“This sales approach creates a powerfully differentiated interaction for customers because it leads with insight, not tiresome questions. And, as it turns out, that difference really matters.”

“In a survey of more than 5,000 business customers, we found that of all of the possible factors that could drive customer loyalty — including brand, product and service quality, and price-to-value ratio — by far the biggest driver is something most companies don’t even think about: the sales experience, accounting for 53% of the overall total.

Customer loyalty, it turns out, is more a function of how you sell than what you sell. Specifically, customers reward suppliers who “offer unique and valuable perspectives on the market” and “educate them on new issues and outcomes.”

“Customers were painfully blunt on this point: They perceived very little difference between suppliers on things like brand, product or price. At the same time, the sales experiences they delivered were highly variable. Some reps, they said, would so thoroughly waste their time that at the end of the sales call they felt as though they’d just been robbed of an hour of their lives. On the other hand, those same customers told us that other reps would take the time to provide information so interesting and valuable that the customer would have been willing to pay for the conversation itself. “I love meeting with those folks,” customers would tell us, “I always learn something when I spend time with them.”

“When you think about the conversations your sales reps are having with your customers, how would you describe them? Are they asking your customers what’s keeping them up at night — or telling them what should be keeping them up at night?”