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Subscription Sales

Outcome Selling: Setting up Your Sales Team for Success

Why More Training on Outcome Selling Won’t Do the Trick

5 min read
By Steve Frost
Nearly every company that we talk to acknowledges that their sales people need to move away from leading with features and functionality. They want their people to make pitches to customers based on their ability to drive business outcomes. This is called outcome selling, and TSIA research shows that it’s vital to success in selling technology-as-a service (XaaS).  

Companies who leverage an outcome-based engagement model increase their win rates by 12 percentage points, deal sizes by seven percentage points, and cut down deal cycles by more than 10%. But how do you get your salespeople to change their behaviors?

Most sales organizations try to solve this challenge by turning to the familiar standbys of compensation and training. In an earlier blog, I talked about how changing the compensation plan isn’t enough to transform your sales organization for selling XaaS. Now, we need to look at why traditional sales training is woefully inadequate for helping your salespeople sell outcomes. You need to provide help and coaching, give them actual tools they can work with, and focus on the outcomes that actually make a difference to the customer.

Why Training on Outcome Selling Has a Limited Impact

In TSIA’s XaaS Revenue Effectiveness benchmark survey, we ask our members what tactics they use to help their salespeople engage in outcome selling. The most oft-cited tactic they give us is that they provide training. However, TSIA data suggests that companies who provide traditional training around outcome selling are actually LESS effective at growing their XaaS revenues than ones who provide no training at all.
Results two polls to discuss training impact below
Survey Results

It’s not a big negative gap in growth rates to be sure, but it does bring into question how much impact training can have on outcome selling. Most of us who have been in traditional sales training know that these programs have everything to do with the salesperson’s tactics and behaviors and very little to do with understanding the customer or what makes them successful. Sales training often focuses on things like prospecting, consensus building, better negotiation, and effective closing. The curriculums are not designed around enabling your salespeople to talk about the business outcomes your offering can influence or how what you’re selling can help the buyer with their KPIs and important metrics. They aren’t built to teach how the common outcomes needed in one industry can differ greatly from others, even when the title of the “buyer” is the same. Sales training has its place, and the skills it teaches are valuable, but they won’t move the needle much on selling outcomes.

Tactics that Make a Difference with Outcome Selling

Start with Coaching

If traditional training doesn’t make a material difference in sales’ ability to sell outcomes, then what does? Well, you need to start by providing coaching and help. Pretty much anybody who has ever tried to take on a challenge, from learning a language to losing weight, realizes that having someone who knows what they’re doing to guide you through the process is extremely helpful.

Since not every salesperson can be an expert on business outcomes, you need to hire people who ARE experts on business outcomes to help them. In many cases, these specialists may have expertise in financial calculations, and can help the salesperson articulate how moving to your XaaS offers can help your customers save money or hit their profit and loss KPIs. (Be careful though: value selling and outcome selling are two different things.)

TSIA is also starting to see outcome experts coming from the businesses that the vendors want to sell to. If they have a priority to sell to healthcare providers, for instance, then hiring someone who comes from the world of healthcare is going to make a huge difference in understanding the vital outcomes of the customer and how you can help them. We see other outcome experts being hired around functional goals, like compliance or security.  

Whatever the outcome your customer cares about, it’s important to have someone on your side that speaks their language. In fact, when our members leveraged coaching and specialists to help sell outcomes, their XaaS growth rates increased 14% over those who did not.

Tools > Training

Once your coaches have helped you gain the expertise and understanding of what outcomes matter to the customer and how your offerings can impact them, it’s time to take that knowledge to the rest of your sales team. Again, traditional training probably won’t help that much in this regard, but giving them tools and templates will have a big impact.

For example, companies that utilized pre-configured financial tools to show the financial impact of their offering saw their growth rates for XaaS increase from 17% per year to 22% per year. Just as importantly, using value calculators led to a five percentage point increase in renewal rate, as the tool was also used to justify why the renewal makes financial sense as well.

Other tactics that companies are increasingly using to help their salespeople drive outcome discussions include guided tools and templates. In our benchmark study, only a handful of companies had started to leverage this tactic, but the ones that were doing so were seeing good results. With templates, like the ones offered by TSIA’s partner company Outcome Chains, salespeople don’t have to be experts in every possible outcome, because the framework for the discussion has already been laid out for them. All the salesperson has to do is “fill in the blanks,” so to speak. Templates and calculators are the best way to disseminate the knowledge of your outcome experts and make sure that everyone on your sales team can harness their power.

Limit the Number of Outcomes You Sell

One last, but very important point to remember: no matter how you try to enable your sales teams to take on outcome selling, you need to limit the number of outcomes that you’re working with. As I said in a previous blog, the difference between solution selling and outcome selling is that with the latter, you’re not looking for a customized value proposition. You, as the vendor, are the one who knows what outcomes matter to the customer and how you can influence those outcomes. If that outcome isn’t one your offering can impact or if it’s something that you can’t track, then it’s not one of the outcomes you should be enabling your sales team with.

Outcomes should be measurable, tangible, and trackable. If they’re not, then you have to question what value they are to you in the sales process, or to your customer as they run their business.

Outcome Selling and Sales: What You Can Do Today

Given what I talked about today, here are three steps to get you started on your outcome selling journey:
  1. Find your outcome experts. Someone in your company already knows and understands what the customer cares about and how they measure success. That person may not be in sales; they might be in finance, or pre-sales, or product management, but they’re probably somewhere. Find them. Talk to them. Have them help you tightly articulate your value proposition and impact on key customer metrics.
  2. Document the outcomes you’re solving. Only about half of the companies that TSIA works with have an enforced process of making sure the sales team documents the desired customer outcome in their customer relationship management (CRM) before closing the sale. That’s an incredible missed opportunity. If you document the outcome your customer cares about, not only will you start to see repeatable patterns, but your Customer Success team will have a stationary target to aim at as they work to make the customer successful.
  3. Continue to brush up on outcome selling best practices. Read our white paper, Making the Move to Outcome-Based Selling, which gives you a deeper understanding of the process of outcome selling and how it can help both you and your customers.

 December 14, 2021

Steve Frost

About Author Steve Frost

Steve Frost is the vice president and managing director of revenue research and advisory for TSIA. He also serves as TSIA's vice president of subscription sales research. Throughout his career, he has held various leadership and business development roles at companies like Google, Netscape, and Loudcloud, helping them define their go-to-market strategy and business development tactics. Steve is dedicated to helping technology organizations grow their services, subscription, and XaaS revenue by optimizing their practices for growth throughout the customer lifecycle.

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