Focus on the Why
By Lisa Benson
May 17, 2022
For better or worse, the selling landscape has changed over the last
few years. Although this shift happened abruptly, changes in selling methods have occurred organically since prehistoric humans first bartered for products and services thousands of years ago. The recent change in selling methods means packaging companies and salespeople will need to adapt and create a strategic plan for growth that involves integrating digital and virtual activities into their sales and marketing processes. Part of that strategic growth plan should also include creating compelling value propositions that will resonate with prospects and allow packaging companies to generate additional revenue through upselling and cross-selling to current customers.
Virtual Is Here to Stay
Before 2020, most packaging manufacturers hadn’t experienced virtual selling. Today, there is a broad acceptance of virtual meetings and remote demonstrations, but does this mean virtual selling is here to stay? And if so, what do salespeople and companies have to do in order to adapt and see new business growth?
According to the data, it appears virtual selling is here to stay. A 2021 Bain and Co. survey found that 92% of B2B buyers prefer virtual sales interactions. Companies that are prepared and have adapted to virtual selling have been successful. In fact, a LinkedIn State of the Sales 2021 survey revealed that almost half of the salespeople responding said they have closed sales of $500,000 or more without ever meeting the buyer in person.
Virtual meetings provide salespeople and prospects flexibility and are less demanding on resources than traditional face-to-face selling. However, salespeople tend to be social creatures, and video can’t replicate the connection you make by looking into a prospect’s eyes and shaking their hand. And virtual networking just doesn’t have the same feel as sharing a meal with a prospect or feeling the energy of tens of thousands of people at Pack Expo. Fortunately, trade shows have returned, with more than 60% of surveyed organizers saying they are focused on designing live experiences in safe physical environments, according to a survey by Convene magazine, a meeting industry trade publication.
It is not likely that selling will return to pre-pandemic ways, nor will face-to-face selling disappear. Moving forward, we will likely see a hybrid selling model through which critical meetings and most networking return to face-to-face, but the vetting of prospects and initial meetings may remain virtual. Some prospects may be more or less risk-averse than others, so there are no hard-and-fast rules of when to meet in person and when to meet virtually.
The Sales Process Before the Meeting
The virtual sale is more than virtual meetings and remote demonstrations. The selling starts long before a potential customer makes contact with a company. Even before the COVID-19 pandemic, most buyers relied on digital information to take them through much of the sales process before any interaction with a sales team occurred. A pre-pandemic Gartner B2B buyer survey revealed that buyers spent only 17% of their time meeting with potential suppliers and 45% of their time researching independently. Considering that the 17% is likely divided among several suppliers, this leaves little time for the salesperson to pitch their product and close the sale.
The heavy reliance on digital information means companies and salespeople must develop an omnichannel marketing strategy that integrates a seamless experience across all channels, virtual and in-person. This includes investing in technology, website development and search engine optimization, and content development.
This also requires investing time to create a sales process that ties it all together to produce repeatable data-driven results.
Create Messaging With a Compelling Value Proposition
Your messaging in sales materials on your website, in your elevator pitch, and across your organization must be aligned, succinct, and easy to understand, and it must address the needs of your prospects and customers. It must resonate.
To create sustainable growth in a competitive market, you need a compelling value proposition as part of your sales and marketing strategy. You may need more than one for additional markets or products and services.
A strong value proposition will inform and persuade prospective customers of your ability to provide value to them. It is typically a single sentence that says, in the simplest terms, “We offer this product or service to this prospective target, providing this value.” The value proposition’s success depends on having value desired by your targeted prospects, which differs from that of the competition. If you position your company, product, or service the same as your competition, then the only thing left is price. Usually, competing on price is a losing proposition for everybody.
To create a compelling value proposition, you need to thoroughly understand your offering, market competition, and your target market. This means understanding how your competitors position themselves in the market, their strengths and weaknesses, the type of customer they go after, and why customers choose them.
It is crucial to make sure your value proposition targets the right type of customer. Trying to be everything to everyone will create an environment in which you are wasting time—a valuable resource—chasing leads that aren’t a fit. Creating a target market profile based on industry, spending, type of products they sell, specific needs they may have, geography, etc., will narrow your focus, providing a better chance that your message will resonate.
Remember, the value you offer isn’t your products and services, and good quality and experienced people should be considered the “price of entry.” Value is measured in terms of your customers’ costs. This may include direct monetary savings, time savings through increased efficiencies or productivity, or cost-avoidance measures.
Answering the following questions can help you determine the value you bring to your customers:
- What are the pains experienced by prospects in your targeted markets?
- What are these pains costing your prospects? Consider costs associated with:
- New business development
- Revenue growth
- Investment costs
- Operating expenses
- Cash flow
- How does your product or service mitigate or eliminate these pains differently than your competitors?
- How does your product or service lower your customer’s total cost of investment (operating expenses, production costs, investments, etc.) or improve your customer’s productivity and performance (revenue growth, labor productivity, inventory reduction, etc.)?
A simplified—and completely fabricated—example is a prospect we’ll call Ace Widgets, a small manufacturer with unpredictable forecasting that is facing long and often changing lead times from their packaging supplier. Receiving critical packaging late results in a delay in shipping widgets (reduced productivity), consequently upsetting customers. These customers may find an alternative product (lost revenue) and post publicly, dissuading others from purchasing from Ace (lost new business development opportunities). Alternatively, Ace may decide to buy large quantities of packaging so they don’t run out. This negatively impacts cash flow and increases operating expenses because they now need to store and manage them.
Faux Packaging Co.’s solution is a dynamic vendor-managed inventory (VMI) system with artificial intelligence (AI) that can accurately forecast swings in production levels, so less inventory is required on hand. This service can be provided at a lower cost than traditional VMI services, allowing smaller companies to participate, and allows Faux Packaging to provide next-day delivery. This service will help increase Ace Widget’s productivity, mitigate its risk of losing current or future customers, and reduce its inventory costs.
Faux Packaging’s value proposition for VMI geared toward small businesses might look like this: Faux Packaging provides a revolutionary AI-driven, vendor-managed inventory service with next-day delivery to small businesses, providing them the control they need to increase productivity, lower inventory costs, and increase customer satisfaction, resulting in a stronger bottom line.
Drive Sales With Upselling and Cross-Selling
Virtually building new relationships has been a challenge for many packaging companies, and new customer growth has become stagnant or has dipped. However, one resource for revenue growth is often neglected: your customer database. These companies are already familiar with your company, so reception will be warmer for upselling or cross-selling opportunities. Upselling, selling customers a higher-end solution, and cross-selling, selling customers related and complementary items, are methods for increasing revenue without the effort required to build new relationships.
To uncover opportunities, look at companies spending much less with you than their expected annual spend for packaging and companies that have gone dormant and haven’t purchased from you in a while. For dormant customers, finding out why they left and taking corrective actions for any reason you are responsible for will be the first step.
When developing your value propositions, don’t neglect these customers if their pains are different from prospects’. Evaluate the gaps between what you currently offer them and what they need. Do they have other pains that you can address and create additional value? Upselling and cross-selling shouldn’t be deceptive or high-pressure. If your customers can clearly see the value in purchasing upgraded or additional services, they will be more likely to feel you are a true partner.
An example of upselling is selling customized packaging to customers who buy standard-sized corrugated boxes. When developing your value proposition, consider the pains that drove other customers to seek out customized packaging over standard packaging. What were they concerned about? Product damage? High shipping costs? Material waste? Environmental concerns? Influential value propositions position you to offer a compelling reason for your customer to upgrade services.
The same is true for cross-selling. Your customer may have partnered with you for a specific reason, not fully understanding the value you can offer them. Asking questions is a great way to uncover unresolved pains for which you have a viable solution.
Meeting with dormant customers and those with the potential for additional spending will allow you to learn what pains they may be experiencing. Find out if they have new products or projects coming up for which your product or service can create cost avoidance opportunities.
Although it can be beneficial to have them visit your facility to see your production and capacity in action, there may be a great benefit to you visiting their facility. This allows you to look around and uncover pains they didn’t realize were solvable. For example, a packaging operator performs a repetitive motion on the packaging line, which could lead to carpal tunnel syndrome. You have a solution for packaging that reduces or eliminates the movement, potentially preventing a lost-time injury, higher compensation costs, and strain on an already thin workforce. Your customer may not have known that such a solution was possible, and if you hadn’t been in the facility to see it and speak with the operator, you would have missed the opportunity to cross-sell.
Selling Moving Forward
Over the last two years, packaging manufacturers were forced to change how they sell, but as we move from pandemic to endemic, we will see the pre-pandemic traditional sales model merge with the pandemic virtual model to create a hybrid process. Virtual versus in-person impacts only how, when, and where meetings and interactions occur. The why hasn’t changed. Prospects have always had and will continue to have that keep them up at night. Differentiating yourself by creating a compelling value proposition by tuning in to the pains of prospects and customers alike will allow you to better position your company as a valuable solution to those pains—and ultimately increase your revenue.
Todd M. Zielinski is managing director and CEO at Athena SWC LLC. He can be reached at 716-250-5547 or firstname.lastname@example.org.
Lisa Benson is senior marketing content consultant at Athena SWC LLC. She can be reached at email@example.com.