14 Apr Who Is Your Number One Competitor?

I recently received a call from a sales professional seeking assistance with her strategy to beat her primary competitor, referred to here as ACME, on a significant sales opportunity. ACME frequently emerged as a finalist in many of her sales opportunities, compelling her to exert considerable effort to secure the sale. During our discussion, I inquired about her approach to competing against her top competitor. She responded: “What do you mean? I just informed you that ACME, whom we have been discussing, is my top competitor.” I clarified that while ACME was a formidable competitor, it was not her foremost challenger. The most significant competitor often requires the buyer to take an action that may be uncomfortable for them, rather than simply choosing between competing products or solutions. And it is present in more sales opportunities than any other competitor, including ACME. It is the choice in about sixty percent of buying decisions by corporations, according to a survey by Hank Barnes of Gartner, Inc.¹

In B2B sales, the most challenging competitor is often the status quo. Buyers may prefer to maintain their current solution or situation because it is familiar or perceived as less risky. Change necessitates adjustments, which many resist unless there is a compelling reason. Buyers often assume (falsely) that there is no incremental cost to remaining with the status quo.

Why do some individuals resist change? Here are nine possible business reasons:

• The buying team has not considered the costs of not making a change. It is erroneous to assume there is no cost to leave things unchanged.
• Companies have reduced their staff, stretching those remaining thin, especially in IT. The reduction limits the bandwidth and willingness to undertake new projects.
• There may be dissatisfaction with the alternative solutions proposed.
• The estimated costs may exceed budgets, or concerns about ROI may arise.
• The business and/or technical risks may be deemed too high.
• There may be a lack of an executive sponsor. If the CEO mandates a change, it will usually occur.
• There is no need to justify a purchase if one decides not to buy from anyone.
• Sales professionals emphasize features and functions, and buyers may not perceive the value of making a change.
• They may not have ever been a qualified buyer.²

So, when preparing a strategy to win the decision and close a sale, it is essential to consider the “do nothing” option as your primary competitor rather than the companies you typically compete with within the marketplace. This option is sometimes known as the “silent assassin” because it often goes unnoticed and is seldom mentioned by prospects.

The salesperson has a significant role in two of the above reasons: assuring that it is a qualified sales opportunity and educating the buyer on the costs of doing nothing.

Your market competition is a mixed blessing because they may help encourage the prospect to make a buy decision, as you are. You might want to revisit your qualification criteria if there is no competition from other suppliers. Or perhaps you did a fantastic job of discovering the opportunity before anyone else.

Many salespeople, including high-performers, struggle to challenge the status quo decision. Often, they complete a sales cycle and are surprised when the prospect informs them they will not purchase from anyone. Sometimes, they say they need time to “think it over.” That stall usually indicates the project is on “life support.” This decision by the prospect can lead to a reaction of urgency on your part, but by then, it is usually too late.

To prepare for competing against a decision not to purchase, one should first understand the prospect’s business problem (“the why?”) and ensure the prospect understands it too. What is the prospect’s sense of urgency? (“Why now?”) Clearly explain how your value proposition addresses the problem and offer a compelling reason to act now rather than later. Demonstrate and quantify the value of your proposal. Your prospect must agree with and believe in the projected outcome you have developed.

Do not assume your prospect understands the unapparent costs of doing nothing or maintaining the status quo. Often, they may overlook the costs associated with poor customer service, inadequate inventories, opportunities for significant operational efficiencies, or additional revenues. Whatever caused them to investigate alternatives has not disappeared.  And problems not addressed now will almost always reappear later, often at the most inopportune times.

Consistently qualify the prospect’s willingness to make a purchase decision from the beginning of the sales cycle. Ensure you communicate with the economic buyer or key decision maker, as most executives will not engage with suppliers if they are not committed to acting.

Engage with all members of the evaluation team and the executive sponsors to understand their perspectives on whether they are considering making a change at this time. Sometimes, one group, such as the users, will be eager to make a change, but IT might not be due to other priorities.

Finally, prepare in advance for the decision to maintain the status quo. Do not be caught off-guard at the last minute when you expect to close the sale, as it is likely too late to change their mind by that point.

Steve

¹  Hank Barnes, “The Cost of No Decisions May Be Greater Than We Think,” Gartner, July 30, 2019, https://blogs.gartner.com/hank-barnes/2019/07/30/cost-no-decisions-may-greater-think/.

² Steven Weinberg, Above Quota Performance (Estes Park, CO: Armin Lear Press Inc., 2022), pp. 93-96.