Every Product Is A Commodity

All products are the same … except for the ways in which they are different.

Questions of differentiation focus on the chasm between you and the competition.

  • What differentiates your product: packaging, usage, longevity, user-friendliness, energy consumption, size, reliability, brand name?
  • What makes your company stand out: depth and breadth of services, inventory levels, ease of doing business, management philosophy, locations, logistics, or industry expertise?
  • What makes your people special: attitude toward customers, teamwork, commitment to their work, engagement in the process of delivering value, or integrity?

Value comes from total customer experience, not just products. Your total customer experience is the combination of your products, from your company, and supported by your people. These three areas are a unique customer experience and differentiated solution. No other competitive solution is exactly the same as your unique solution. So, the next time someone asks what makes your stuff different, answer them, “We make it different.”

Tom Reilly is literally the guy who wrote the book on Value-Added Selling (McGraw-Hill).

Next Value-Added Selling public seminar is September 27-28, 2016. It is presented by Paul Reilly. Call to reserve your seat. 636-537-3360 or visit www.TomReillyTraining.com.

 

What Makes a Good Salesperson?

A Google search for “Sales Secrets” yielded 18 million hits. One article offered 25 secrets. Really, that many secrets? There were multiple seven-secret articles and several three-secret articles. Why read a paltry three-secret article when a 25-secret article is available? Some are obvious to the point of embarrassment: Timing is everything, and only sell to people who want to buy. Most share common themes: Practice the A-B-C’s of selling—always be closing; People buy quarter-inch holes, not quarter-inch drills; and No one cares how much you know until they know how much you care. Some are downright ridiculous: Stay healthy, selling is good theatre, and be a happy loser.

There are three absolutes for sales success. Unfortunately, no one knows what they are.

The nascent field of neuroscience—young, compared to other scientific disciplines—offers some insight into the potential everyone has for sales success. Through sophisticated brain imaging technology, neuroscientists have identified an altruism gene. Stated differently, humans are hard-wired for altruism. Humans are wired to think in terms bigger than themselves. Humans are biologically predisposed to set aside self-interests for the good of the species.

Preservation of the species is not limited to humans. In the animal kingdom, there are examples of one animal species rescuing a different species. The L.A Times, People Magazine, and BBC documented heart-warming acts of kindness. In a German zoo, a Dachshund adopted a tiger cub rejected by its own mother after its birth. In a Russian zoo, a German Shepard adopted a litter of cougar cubs when the staff felt the parents might become too aggressive with the cubs. In New Zealand, a dolphin rescued a pygmy sperm whale and her calf that were caught on a sandbank. Even Koko, the famous hand-signing gorilla, expressed a fondness for kittens. Caring is instinctual.

For humans, altruism manifests perceptually as empathy: It is the ability to see another’s point of view. Empathy is the antecedent of fairness and understanding. One could argue empathy is foundational to integrity. How can one be truly empathic when sacrificing another’s welfare for personal gain?

So, if there is a secret to sales success, it must be to follow one’s natural instinct to view things from the customer’s point of view, pursue fairness in all transactions, and build relationships on mutual trust.

This article is excerpted from Tom Reilly’s new book, The Humility Paradox, available at AMAZON. Read and comment on this article at www.TomReillyBlog.com.

Tom Reilly is literally the guy who wrote the book on Value-Added Selling (McGraw-Hill).

Next Value-Added Selling public seminar is September 27-28, 2016. It is presented by Paul Reilly. Call to reserve your seat. 636-537-3360 or visit www.TomReillyTraining.com.

The High Cost of Cheap Prices

By Tom Reilly, author of Value-Added Selling (McGraw-Hill)

Cheap prices seduce and delude. They scream as Sirens to price-sensitive shoppers and delude them into believing they are getting great deals because of the cheap prices. Cheap prices do not equate to great deals. Consider this:

The flying public craved cheap air fares and got them, along with fewer flights, overbookings, cramped planes, diminished service levels, hub systems, and airport congestion. The overcrowding and heightened stress levels gave rise to a new phenomenon, air rage among travelers. Consumers are now suffering the high cost of low prices.

The U.S. consumer appetite for cheap goods contributed to a $531 billion trade deficit in 2015. The trade deficit with China alone was $367 billion (69%) of our total imported goods. American consumers are not buying Chinese goods for their quality. They are buying Chinese goods from discount stores because of their cheap prices. Exporting domestic manufacturing jobs is a high cost to pay for cheap prices.

Cheap gas prices should appeal to everyone. When consumers spend less for gas, they theoretically have more money for other things, but that expectation has not materialized. JPMorgan Chase studied credit card spending and found that people spent their windfall savings on more gas. It is counter-intuitive to think that cheap energy is a bad thing. Economists predicted the upside of cheap oil, but the president of the San Francisco Federal Reserve Bank said, “We got this wrong.” Why?  The losses from lower prices caused energy companies halt investments and lay off workers. Cheap energy is an indicator of slower economic activity. One man’s pain is another man’s pleasure.

The real price of everything, what everything really costs to the man who wants to acquire it, is the toil and trouble of acquiring it. Adam Smith, Wealth of Nations

The exchange of one commodity (money) for another (goods and services) demands equity to be considered value. What buyers sacrifice is the “toil and trouble of acquiring” plus the cost of utility. The price of something says nothing about the cost to own, use, service, store, maintain or dispose of it. That is utility cost.

Buyers sacrifice to acquire. They pay a price and suffer costs. When the return on these two investments is equal to or greater than the sacrifice, they get a great deal. Cheap prices coupled with high costs result in lousy value if the return is less than the investment. Before buyers accept a cheap price as a good deal, they must ask themselves this question, “Is this cheap price too high a cost to pay?”

Next Value-Added Selling public seminar is September 27-28, 2016. It is presented by Paul Reilly. Call to reserve your seat. 636-537-3360 or visit www.TomReillyTraining.com.