Written by Matthew Dixon and Brent Adamson, ‘The Challenger Sale’ is one book that salespeople recommend pretty often. Apart from providing a better way to approach customers, it also helps managers improve coaching, sales training, and customer loyalty.
The authors of the book, Matthew Dixon and Brent Adamson are the managing directors of CEB’s Sales Executive Council in Washington, D.C. This book has its base on an in-depth study of thousands of sales reps in various industries done by CEB Inc. The authors say that the old-school method of relationship building is not suitable for complex and sizable B2B solutions.
The Challenger Sale helps discover a new sales method called the “Challenger” sales method. It is much more effective than the traditional approach of building a relationship with customers. As per the “Challenger” sales approach, the salespeople control the sale. They make customers think from fresh angles. Apart from that, challengers push back rather than agreeing to the demands of customers. The authors further reveal the skills and behaviors that drive the performance of challengers.
Take a look at The Challenger Sale book summary,
A few top points in the book that are worth giving a thought to are as follows,
1) To begin with, the solution selling model is all about giving bundled offerings based on consulting. It is different from the transactional sales of a single product. Suppliers came up with this model to make it hard for competitors to copy what they had to offer.
2) Solution selling made things difficult and a bit riskier for customers. This is because they seek sales based on consensus, want customization, and use 3rd party consultants to pass on a bit of the risk to the supplier. Selling has become more difficult now due to this.
3) The top performers do matter in Solutions selling. The performance gap between average and star performers is 59 percent in transactional sales, whereas it is 200 percent in solutions selling.
4) There are five different sales reps. Those are the Hard Worker, the Relationship Builder, the Lone Wolf, the Reactive Problem Solver, and the Challenger. In most cases, especially in complicated sales scenarios, Challengers are dominant and account for 50% of star performers. On the contrary, the relationship builders have their share come down to zero. The success of the sales force thus depends on the Challengers.
5) Challengers can use constructive tension to carry out three things – teach customers to compete better, tailor to match every stakeholder and control the sales process on the whole.
6) Effective teaching involves identifying the unique value proposition of a supplier. The CEB survey showed that only 35 percent of companies could establish themselves as preferred ones over competitors. While only 14 percent were able to offer benefits that customers found unique.
7) The core question of the Commercial Teaching pitch is – “What is right now costing our customers more money than they realize that only we can help fix?” Finding the unique qualities of suppliers is the central part of the Challenger model.
8) CEB’s research makes it evident that the main concern for an organization’s decision-maker is getting consensus across the organization. Therefore, to close deals, reps have to nurture stakeholders in the organization. Challenger reps not just help tailor the teaching to individual stakeholders but also cultivate loyalty throughout the organization.
9) Taking control of sales helps maintain momentum in the sales process as well as makes it easy to discuss money. Challengers control the sale by teaching the customer how they should purchase a complex solution and be involved in this solution.
10) 75% of reps feel that procurement has more power, while 75% of procurement officers think the power lies with the reps.
11) 63% of reports say that the managers lack the skills required to adapt to the sales model.
12) The factors that matter in managerial excellence are selling skills, coaching, and sales innovation.
13) Coaching doesn’t have a prominent effect on the strongest and weakest performers.
14) The investigation, creation, and sharing drive sale innovation.
15) To turn a sales team into challengers, it is essential to get managers on board. Convincing the managers is vital to implement Challenger Selling across the organization.
Let’s have a deeper look at what The Challenger Sale has to say,
The “Always Be Closing” is a famous line from the movie Glengarry Glen Ross but that doesn’t mean that it is the ideal way to sell. Most of the top salespeople these days don’t do so. They are instead focussing on teaching people and enable them to find solutions for the challenges they face. Persuading prospects to buy a product or service has taken a back seat in this new digital age.
One finding in the sales study says that the sales experience is not the brand, price, service, or product that drives 53 percent of customer loyalty. Rather, the sales experience depends on how a rep interacts with customers.
As per the study, you can categorize B2B sales reps into 5 different profiles. Each of them defines the skills and behaviors sales reps use to interact with customers.
They are the following:
1. The Hard Worker – This kind of sales rep is self-motivated, and does not give up soon. They take interest in feedback and personal development.
2. The Lone Wolf – Such a sales rep follows his instincts and is self-assured. They do deliver results but is tough to manage.
3. The Relationship Builder – This sales rep is a classic consultative rep who builds relationships with prospects.
4. The Challenger – Such a sales rep has a different view of the world and loves to debate. Moreover, he understands the customer’s business well.
5. The Problem Solver – This type of sales rep is detail-oriented and reliable. He tries to make sure that each and every problem gets resolved.
‘The Challenger Sale’ talks about the ‘Challenger Approach’ that relates to the sales performance of top performers.
The study revealed that 40 percent of high sales performers use a Challenger style and not the other four selling styles.
There is double the chance of high performers to use a Challenger approach as opposed to another one.
More than half of the star performers use the challenger profile for complex sales.
Only 7% of the top performers chose the relationship-building approach.
The Challenger approach’s success rate increases with the complexity of the sales, but it works the best with high performers. For average performers, it was as successful as other approaches.
Further, the book talks about the traits of a challenger rep, and they are,
a. Providing a unique perspective to a customer
b. Possessing solid two-way communication skills
c. Knowing about the value drivers of customers
d. Identifying what the economic drivers of a prospect’s business are
e. Talking about money comfortably
f. Having the ability to pressurize the customer in a good way
‘The Challenger Sale’ defines a challenger rep by his ability to do 3 things:
a. Teach customers what they don’t know about. Additionally, provide valuable insights into competing in their market.
b. Tailor the sales pitch to meet the requirements of the decision-maker.
c. Take control of the pricing discussion and challenge the thinking of the customer around the issue.
In the book, the authors stress the fact that solution selling is not well-suited anymore. This is because customers have a lesser chance of investing time in helping sales reps find out their needs. As per their research, seven areas create a positive customer experience. They are,
1. A rep offering unique/valuable perspective in the market
2. A rep helping the customer find alternatives
3. A rep providing ongoing advice and consultation
4. A rep assisting the customer in avoiding possible problems
5. A rep educating the customer on new issues and outcomes
6. The supplier being easy to purchase from
7. The supplier has widespread support in the organization
The authors outline a teaching approach called “Commercial Teaching”. Here, the sales rep teaches the prospect how to think about their requirements. It is a new skill set that reps have to learn. Here are the six components a good teaching pitch should have,
1. The Warmer: Firstly, show the prospect that you understand their problems.
2. The Reframe: Relate the issues they face with a more significant challenge or opportunity they did not consider before.
3. Rational Drowning: Show prospects why they should change the way they think.
4. Emotional Impact: Make an emotional connection in the story you are narrating. It has to show the pain they experience daily in their firm.
5. A new way: Then, convince them about your product or service and show them the fresh angle of looking at things.
6. Your solution: Finally, show how your answer is the best among the rest and how it is perfect as per the new way of thinking about the business.
Research says that the biggest challenge decision-makers face is that of consensus in the organization. One way of closing a sale is by paying attention to the stakeholders of the organization. But eventually, to build peace, you have to educate end-users about the details of their businesses.
In the conventional sales model, reps get details from stakeholders to pitch their product or service to higher authorities. Thus, the main focus is on the bond between the rep and the decision-maker. On the other hand, in the challenger model, the connection between the sales rep and the stakeholder is strong. Hence, to close the deal, you would use a connection between the two.
As per this model, reps have to talk to more stakeholders than they did before. The right way of tailoring messages is by starting at the industry level. And later getting into the organization and individual’s role. That is why challenger reps customize individual stakeholders based on customer outcomes.
Here is the Solae story in ‘The Challenger Sale’,
Solae, a company manufacturing soy-based food ingredients, went for an expansion. However, the reps were in a difficult position as the count of stakeholders increased. But, Solae created Customer Outcomes Cards that had what every stakeholder cared about. It contained different kinds of details. This tool allows reps to know about the critical stakeholders for a solution and their important outcomes.
For sales, Solae uses a template to record customer buy-in. It makes use of Customer Outcomes Cards. Then, reps ask stakeholders to sign on the template. Upon carrying out the final conversation with the decision-maker, they present the document as proof of consensus across the whole organization. Subsequently, in Solae’s approach, they look upon all the stakeholders as customers.
When you take control of the sale, two things occur,
1. The ability to make the sales process moving
2. Keep discussion of finances comfortable
You can turn down discounts only when you are confident that you created value by educating the customer on what they didn’t know previously. Challengers take control of the sale by educating customers on the process of purchasing a complex solution.
They make the customer look at the challenges from a fresh perspective. When the customer tries to ask for a discount, the challenger will present them with data and insights. Here the challenger does push the customer but without being aggressive.
‘The Challenger Sale’ says that there is a baseless fear that encouraging reps to be assertive can make them aggressive. Reps feel that the power lies with the customer, and that is why they are passive. One reason for this behavior is that reps tend to undermine the value of the company they are a part of. Most often, they don’t seem to value the technical ability and expertise of the firm.
Taking control means knowing that you are bringing value to the customer. Try giving them new perspectives to look at things. Another reason for passivity is the customer-centric approach that has been in use for too long.
Here’s how DuPont takes control,
DuPont is a company that enables reps to take control when there is a negotiation. This is done with the help of a template for pre-negotiation planning. The template notes the supplier’s power position, such as brand, pricing, product, and much more. There is documentation of areas of strengths and weaknesses as well. Doing so gives the rep a clear idea of the value of what he is selling and gives him the confidence to move ahead with the negotiation. Thus, this will help prepare the sales rep to face the customer’s questions, and understand the supplier’s needs. Then he can better identify what concessions he can give.
There is a 4-step framework that DuPont uses for negotiation,
1) Acknowledge and Defer – Customers may pressurize reps for a discount. The rep agrees to work on it but asks for time to understand the client’s needs better. This way, he can create more value. Hence, the rep gets the time from the customer and creates creative tension.
2) Deepen and Broaden – The rep requests the customer to let him know about their needs. Then, identifies the solution to serve. Doing so will make the customer identify the value of the solution.
3) Explore and Compare – Analyze different trade-offs to see options that don’t affect the margins but offer customer value.
4) Concede as per the plan – Determining what, when, and how to concede is crucial while negotiating with the customer. Planning the sequences is essential.
You need sales managers to implement the Challenger model for sales. However, 63% of the members of CEB report that their managers lack the skills they require for evolving the sales model. 3 high-level factors matter: selling skills, coaching, and sales innovation.
The dimensions of coaching have the following dimensions,
a. It is ongoing
b. It is tailor-made for each rep
c. The focus is not on knowledge but on behavior
To become experts in coaching others during sales interactions, there is a framework called PAUSE,
P- Prepare for the coaching conversion – When a rep prepares in advance, there’s a kind of continuity between subsequent sessions of coaching.
A- Affirm the relationship – There has to be an emphasis on personal development by keeping performance management discussion aside.
U- Understand expected behavior – Teach managers what to observe and what to look out to handle the conversations in coaching better.
S- Specify Behaviour Change – Give managers a set of behaviors and standards to give feedback.
E- Embed New Behaviours – Institutionalize the coaching.
Following three key activities drive sale innovation,
Investigating involves working with the rep and finding out what is preventing the deal from moving ahead.
Creating solutions involves mapping supplier capabilities to resolve customer challenges as well as creating opportunities for cross-selling.
Talking about sharing, great managers tend to share their innovative efforts so that reps replicate them.
Coaching helps in enhancing known behaviors, but innovation works in handling unforeseen situations.
As a sales manager, you would want reps to challenge customers using new methods. Some reps have a natural inclination towards the challenger model, but others too can learn it.
You can provide reps with plenty of information about different industries and companies to customize pitches according to that. Then, you can create cheat sheets explaining the objectives for different positions in specific industries. Further, managers have to teach sales reps how they can be successful as challengers. They can do this by sharing what they learned from other salespeople in the same kind of situation.
a. Every high-performer is not a challenger. You have to identify challengers properly to see their sales behavior.
b. Be careful about allowing lone wolves to become dominant in the organization.
c. You should train reps on the Challenger model, but at the same time, it is essential to hire challengers.
d. Make the most out of the Challenger model by developing individual skills and organizational ability side by side.
e. It is not enough to do sales training. Focus on creating receptivity before the sales training and come up with a structured training approach.
a. To be customer-centric in the real sense, you have to be insight-centric. Moreover, you have to generate unique insights that teach customers to act differently.
b. It is most important to identify the supplier’s unique value proposition. You can’t have a Challenger model without it.
c. Stand out in the crowd of competitors. You can do so by creating a challenging way with your main focus on the customer’s pain points.
a. It is enough to go in for 80 percent adoption of the Challenger model instead of complete adoption to shift your organization’s behavior.
b. You have to be ready to accept the fact that 20 to 30 percent of the sales reps will not switch to the Challenger Model.
c. Use the power of terminology to your benefit.
d. You can customize the execution of the Challenger model so that you meet the norms of behavior.
1) In today’s world, a customized and personalized product or service is the main selling factor. Previously, sales depended on the sales rep’s ability, but there has now been a shift. Now it has become customer-oriented.
2) In the digital age, sales rest on the ‘Challenger’ type of salespersons. The challenger type is the one who understands the needs of customers. Moreover, provides them with innovative solutions.
3) A challenger salesperson directs the conversation with the customer. They convince them about the effectiveness of his solution from different perspectives.
4) A challenger controls the sale right from the beginning.
5) To build a “challenger” sales team, a sales manager must take everybody on board. This involves sharing knowledge and solutions.
6) Managers are crucial entities that facilitate the execution of strategies the higher management defines.
In conclusion, every sales professional should read this book. The authors have done in-depth research. It seems that the new challenger selling approach is a true game-changer. Hence, you can take your company to the next level using this approach.