In the movie A League of Their Own, Tom Hanks says, “It’s supposed to be hard. If it wasn’t hard, everyone would do it. The hard… is what makes it great.” Tom was talking about professional baseball, but this applies to outcome selling as well.
Outcome selling is something every organization wants to do, but very few actually do well.
During the inaugural meeting of the Outcome Selling Advisory Ecosystem, members were fortunate to hear from President and Chief Operating Officer of Duo Security, Bill Welch, a thought leader with over 25 years of battle scars from spearheading successful sales transformation initiatives at Symantec, HP Software, and Zscaler. Bill has helped sales organizations in three very different growth postures evolve from focusing on products and services to outcomes and value and, by doing so, increased profits.
Based on an analysis of data at these companies, Bill found three key impacts of outcome selling:
1. Lower Price Discounting
Bill and his team analyzed over 500 deals and compared the intensity of outcome-selling engagement with the discount given to the customer. As the graph above shows, the amount of discounting was significantly lower for the deals that employed outcome selling. Bill explained,
“As leaders, the better we can control the value for the company that we’re representing, the better we are as far as delivering on the revenue numbers that wall street or our investors are expecting.”
2. Higher Quota Attainment
The success of the sales professionals and their ability to achieve their quotas directly mapped to how much they embraced the concept of outcome selling. The individuals who intensely used outcome selling strategies were typically at 150-300% of plan. Bill noted that, at Symantec, HP, and Zscaler, the top sales teams making well over $1M in on-target earnings were embracing the outcome-selling framework.
3. Increased Win Rate & Deal Size
Bill and his team found that, when outcome selling was leveraged, the size of deals for new logos was three times greater. If the deal was an upsell opportunity, the result with outcome selling was typically four and a half times greater. They also concluded that the conversion speed was faster if an outcome-based framework was used.
The Outcome Selling Advisory Ecosystem Members then had a Q&A with Bill. We include some of the highlights below:
- Q: Were there particular training methods or tools or a program that you adopted to help instill the positive business outcome mindset into your sales force more broadly?
- A: A couple of things. First, we met them there they were. We tried to put everything into the frameworks of the systems they were already using, like Salesforce.com.Second, we made sure that successful outcome selling was recognized publicly. We celebrated our leading reps at SKOs, and we invited our customers who achieved their desired business outcomes to customer advisory boards. We highlighted when outcome selling helped customers realize their time-to-value in a faster manner – which is what they value. We then made the linkage to the team that made it happen.
- Q: How did you get executive leadership to see value in an outcome-based approach to sales?
- A: Let them see it firsthand. Invite them with you when you present the proposal to the executive at the customer account. Bring the CEO into the meeting where you are linking the business drivers that you learned about during the discovery phase to your solutions’ technical capabilities.You could also show them the actual data. It is pretty hard for the CEO or CFO to debate with you when, quarter over quarter, you are decreasing the price discounting.
- Q: Flipping the last question around – sometimes customers have a level of urgency to simply solve the immediate problem and see an outcome-based approach as getting too deep in the weeds or too academic. How did you get hesitant customers on board?
- A: I agree. I think it is very difficult sometimes at the executive leadership level for them to see the real value of this. But there are a couple of things that I observed with the team that work well:
- The involvement of the real doers at the account, where they would actually give you real plausible, tangible business drivers so that you could actually build out that appropriate outcome proposal.
- Customer success teams or sales engineering teams who would help the customers realize the value that you promised them in your proposal. Getting the customers success program going and getting referral sales. This was probably most effective. Get current customers on the phone who can explain the value that they have already realized.
To gain more in-depth insights into outcome selling, access the recording of the first Outcome Selling Advisory Ecosystem meeting here.
We would love to hear from you:
- What have been your successes and challenges with outcome selling
- How have you made your sales transformation great?