Table of Contents
What is Needs-Based Selling?
Needs-based selling is a sales approach that focuses on finding and understanding a customer’s needs, then positioning the product or service as the best solution to meet those needs. It’s a form of solution selling where the salesperson works to actually understand the customer’s unique challenges, instead of simply pitching a product.
Also called consultative selling, the needs-based approach to sales flourishes in sales environments where the product is complex or highly configurable and its benefits aren’t easy to comprehend right away.
Solar is one example of a B2C product that can benefit from needs-based selling. The SaaS industry typically uses needs-based sales strategies in the B2B space.
- Consultative selling
- Solution selling
How Needs-Based Selling Improves Sales Performance
In needs-based selling, the sales rep puts the prospect first. They ditch the pitch. When buyers feel they’re being helped out, it offers untold benefits for the salesperson and their overall performance.
Better Customer Experience
B2B and B2C buyers seem to have one thing in common: they both don’t trust salespeople. According to some research, as few as 3% of people trust the sellers they speak with.
Statistically few buyers respond to cold outreach, especially if it’s a phone call. And 85% of prospects who do are disappointed with their on-the-phone experience.
The main reason for this isn’t that people are resistant to buying. They just don’t want to be sold. And when they smell a sales rep’s commission breath, they start to second-guess whether the seller actually has their best interests in mind.
Needs-based selling takes the opposite approach. Rather than convincing a buyer they need the product, they start with active listening. Then, they frame the product as the solution to their customer’s problem.
Better Selling Experience
Lead qualification is quite challenging. Worse, however, is qualifying the wrong leads, moving them through the funnel, and watching them churn after a few months because the product wasn’t meant for them.
As a sales rep listens to a prospect’s challenges, they figure out which product they’re the best fit for, how to set them up with it, and what they need to do to move them through the sales process more quickly.
If they aren’t a qualified lead at all, they’ll know that too. Rather than focus too much time on bad leads, learning challenges upfront also helps sellers prioritize their sales activities based on where they’re likely to make the most impact.
Very little of the selling experience is spent with any one prospect, so time is of the essence.
Builds Trusting Relationships
When sales reps understand a customer’s pain points, then position the product as the best solution for that problem, they start building trust.
The customer feels like they’re being heard and taken care of. With consistent needs-based selling practices, this trust blossoms into long-term relationships which can continue to grow over time.
A consultative approach is also a breath of fresh air for prospects, who are usually met with a sales pitch from inexperienced sellers. Nobody wants to feel their time is wasted, and a needs-based approach shows the customer that their seller respects their time.
Tailored Solutions to Customer Needs
Customers don’t always know how to pick the ideal solution for their situation (especially if they weren’t aware of their problem in the first place). They’re sometimes entirely unfamiliar with the product.
Taking extra time to learn what potential customers are looking for, and then positioning the product as a solution to that specific issue, means they end up making a purchase they’ll actually get value from. It also ensures they’ll know how to use it.
Increases Customer Retention
A customer-centric approach to sales sets vendors up nicely for customer onboarding. Since value is communicated and understood upfront, customers who buy are already somewhat familiar with how the product fits into their lives. And since these buyers are generally more qualified, this facilitates faster (and more permanent) user adoption.
Over time, customer relationship improves because it’s based on value. Not only does the business retain more of its customers, but those customers turn into advocates and refer other prospective customers to the product.
The Needs-Based Selling Process
Needs-based selling is a seven-step process. It starts with researching the customer and ends with closing the sale.
Research: Understand the Customer
A seller can’t lead with value unless they do a little research ahead of time. It’s the rep’s job to examine the prospect’s current situation and assess it with any information they’ve already given them.
Information like their role, company, company size, and industry are all easy to find on a LinkedIn profile or website. If they respond to a certain cold email or book a demo from the website, chances are they’ll add more context to their current situation.
Introduction: Build Rapport
At the research stage, the sales rep doesn’t know much for certain. But doing research before the initial conversation means they can walk into the call with a few key pieces of information.
If they’re wrong, the prospect can correct them. Either way, the buyer on the other end will be pleasantly surprised at the effort to get to know them.
Using this information to start the conversation with value eliminates the need for an ice-breaker. It also helps them establish rapport and encourages customers to open up about their unique challenges.
Discovery: Ask Open-Ended Questions
As the prospect opens up, keep them talking. The more information, the better.
Sellers should stay away from Yes/No questions or those that warrant a simple response. Some buyers will be easier to get talking than others, but the more open-ended questions the seller asks, the better.
The goal is to understand if there are any problems that need to be solved, from a customer’s perspective.
Empathy: Actively Listen
Active listening is one of the most important sales skills for anyone taking a needs-based sales approach.
There are two parts to active listening: understanding and responding.
- Understanding — Hearing the customer’s words and try to understand the emotion behind them.
- Responding — Using non-verbal cues like nodding, an occasional recap, or an “I see” to show you’re paying attention.
When the prospect is finished with their response, the seller must first reiterate what they said. Repeating something verbatim isn’t a good idea, but a quick, paraphrased summary of the customer’s problem/statement establishes that the seller and prospect are on the same page.
Presentation: Customize the Solution
There are three ways a seller might customize a solution for a buyer:
- Fully custom solution — When a rep is selling a highly configurable product (like enterprise software or custom manufactured goods), they will create a unique solution based on the customer’s needs and budget.
- Semi-customizable solution — A vendor might have a few interchangeable options that could fit the customer, but may need to tweak certain aspects of the product or bundle multiple products to fit their particular requirements.
- Value proposition — If a company has a simple product catalog, the seller will present it to the buyer just as they would anyone else, but frame the solution in such a way that the value speaks to them personally.
Handle Objections: Respond Empathetically
It’s rare a sales rep closes a deal without some sort of pushback from the decision-maker(s). Every buyer will have fears and reservations, even if they are just masking the fact they’re reluctant to make a purchase.
Empathizing with the buyer means applying the same active listening skills to understand, validate, and respond to their concerns while keeping the conversation focused on solutions.
The goal is to demonstrate your understanding of the prospect’s point-of-view and provide a response that not only assuages those fears, but also shows how your product fits into their life in a meaningful way.
Close the Sale: Drive Home the Benefits
Getting to Closed Won means reminding the prospect of the value they’ll get from the product or service.
The seller needs to re-emphasize how their solution will relieve their customer’s pains, explain why it stands out from the competition, and summarize any key features that made them choose it in the first place.
Usually, driving home the benefits is more of a subtle reminder. It’s about taking the context of the conversation, reminding the prospect of the problems they face, and repositioning the product as the viable solution.
Needs-Based Selling Questions to Ask
The key to consultative selling is open-ended, needs-based questions. Here are ten examples of excellent questions to ask:
- Understanding the current situation
- “Can you describe your current process or setup for [specific area or task]?”
- Pain points and challenges
- “What are some of the biggest challenges you face in your day-to-day operations?”
- Desired outcomes
- “If everything worked perfectly, what would success look like for you?”
- Comparative understanding
- “How does the solution you’re using now compare to what you’d ideally want?”
- Stakeholders and decision-making
- “Who else is involved in the decision-making process for solutions like this?”
- Budget considerations
- “Do you have a specific budget in mind for solving this challenge?”
- Time sensitivity
- “How soon are you hoping to implement a solution to address these needs?”
- Future growth and scalability
- “Where do you see your company or department in the next 3-5 years, and how do you anticipate your needs changing?”
- Alternative solutions
- “Have you explored other solutions or vendors for this? If so, what did or didn’t you like about them?”
- Value prioritization
- “On a scale from 1-10, how important is [specific feature or benefit] to you, and why?”
Remember, the idea behind these questions is not just to gather information but to engage in a meaningful dialogue. You’re genuinely listening to the client and demonstrating your interest in helping them find the best solution for their unique situation.
Technology for Effective Needs-Based Selling
Without the right technology, sales reps don’t have the right customer data, notes from previous interactions, or content to support their conversations. It’s hard to stay organized and top of mind for the customer when they don’t have the right tools at their disposal.
Customer Relationship Management (CRM)
CRM software can help a sales rep stay organized throughout the selling process. With CRM, reps can store customer information and notes in one central hub, allowing them to quickly access customer data when needed and ensure they’re not missing any important details. As deals move forward, they’re reflected in CRM pipeline stages.
Consultative selling involves giving buyers the right content to guide their decision-making. They won’t spend much time on Zoom calls with salespeople, but they certainly will do their own research.
Sales enablement software knows the context of every sales interaction. It integrates with the company’s other systems to immediately provide the reps with customer profiles, comparison materials, pricing information, product specs, articles, documentation, and anything else the rep might need to guide the sale toward closure.
Configure, Price, Quote (CPQ)
CPQ software is central to the needs-based sales approach because it helps reps create custom proposals and product configurations. They use it to create customized and/or bundled solutions tailored to the customer’s needs, complete with pricing and payment terms that fit their budget.
CPQ software automates most of the tasks associated with the latter half of the needs-based selling process. Rather than wait hours or days for responses, sellers and buyers can work together in real-time to configure a solution that makes sense.
People Also Ask
What are the 4 types of selling?
The four types of selling are transactional, solution, consultative, and provocative selling. Transactional selling is the most basic type of selling that involves exchanging a product or service for money. Solution selling focuses on helping customers solve problems through the company’s products, but requires the product to be a tailored solution.
Consultative selling is similar to solution selling, but it’s more about communicating specific benefits to the buyer, rather than tailoring the product itself. Provocative selling is the most aggressive approach — provocative sellers challenge a customer’s current beliefs and processes.
How does needs-based selling differ from transactional selling?
Needs-based selling takes a personalized approach to sales. It puts the focus on understanding customers’ individual needs and providing tailored solutions that meet them. It requires sellers to build trust through active listening, empathizing, and providing tailored solutions.
Transactional selling relies heavily on features and benefits, discounts, and price. It is focused on moving products quickly and efficiently with minimal customer interaction.
When is needs-based selling most effective?
Needs-based selling is most effective when a customer’s needs are diverse, complex, and require detailed solutions. It is also beneficial in situations where the buyer is unaware of the problem they need to solve or the solution required.