by: Neil Rackham
Neil Rackham is a best selling author. You can read more about him at his website linked to his name.
Giving Benefits in Major Sales
In this chapter, Rackham shows what Huthwaite’s research found about the Demonstrating Capability stage.
Features and Benefits: The Classic Ways to Demonstrate Capability
Basics of Features and Benefits
Facts, data, or information about your product or services. They are unpersuasive.
Huthwaite’s research found that:
- The level of Features is slightly higher in unsuccessful calls. Thier difference is small enough to conclude–Features are nuetral.
- In small sales there’s a slight positive relationship between the use of Features and call success.
- In larger sales, Features have a negative effect when used early in the call and a neutral effect when used later.
- Users respond more positively to Features than do decision makers.
- In the middle of very complex selling cycles of technical products, the customer sometimes develops a “Feature appetite”. When this happens, the customer demands considerable product detail and may respond positively to Features. It’s at this stage of the selling cycle that technical experts, systems analysts, and other sales-support people often have a positive impact on the customer.
Generally, Huthwaite’s work found that, as writer’s have been saying for 50 years, Features are low-power statements that do little to help you sell. It’s beeter to use Benefits.
What’s a Benefit?
When Huthwaite began to investigate Benefits, no two writer’s on selling seemed to have the same definition of a Benefit.
Which Definition is Right?
Huthwaite’s research team set out to test which definition of Benefit had the most positive impact on customers. After testing several definitions, Huthwaite chose two for their research test:
- Type A Benefit. This type shows how a product or service can be used or can help the customer.
- Type B Benefit. This type shows how a product or service meets an Explicit Need expressed by the customer.
At first sight these two definitions of a Benefit seem very similar. However, their effect on customers is dramatically different. If you assume the customer has a need for your solution and state the Benefit, it is a Type A Benefit. If the customer states a problem and you explain the Benefit of your product or service, this is still a Type A Benefit. This is because the customer has simply given you an Implied Need, not an Explicit Need.
How Important is the Difference?
Huthwaite’s research found that the Type A Benefit is quite strongly related to success in smaller sales but is only slightly related to success in larger sales. In contrast, the Type B Benefit is very strongly related to success in all sizes of sales.
Huthwaite put more descriptive labels on the two types of Benefits in order to avoid confusion in their research. For the rest of this chapter:
Type A Benefit is referred to as an “Advantage“.
Type B Benefit is referred to as a “Benefit“.
Thus, there are three behaviors that can be used in Demonstrating Capability.
The Relative Impacts of Features, Advantages, and Benefits
To make a Benefit, you must have an Explicit Need.
Benefits and Call Success
Huthwaite compared the level of Benefits in 5000 calls with the outcome of each call. They found that Benefits were significantly higher in calls leading to Orders and Advances. In contrast, the level of Advantages was not significantly different in successful and unsuccessful calls.
Features, Advantages, and Benefits in the Longer Selling Cycle
Huthwaite measured the effects of sales behaviors, (Features, Advantages, and Benefits), at different points in the selling cycle.
Features had a low impact on the customer throughout the selling cycle.
Early in the cycle, particularly during the first call, Advantages had a moderately good statistical relationship to call success. As the cycle progressed, Advantages had a decreasing effect on the customer until, as the end of the cycle approached, they were no more powerful than Features.
Why Do Advantages Run Out of Steam?
There are three possibly reasons:
- At first meeting, the customer expects to hear about the product rather than discuss needs.
- The seller is so enthusiastic that they jump right into Advantages.
- Advantages, unlike Benefits, have no link to the customers Explicit Needs.
Advantages are less powerful than Benefits all through the selling cycle.
Selling New Products
One area consistently handled badly by both the inexperienced and experienced salespeople is the new-product launch.
This can be explained in terms of Features, Advantages, and Benefits.
The Bells-and-Whistles Approach
The problem lies in how the product is introduced to the sales team. When launched, the marketing people gather all the sales managers and sales team to present this new product with all it’s Features and Advantages. With all the excitement generated, even the most experienced sales people speak in terms of Features and Advantages like they were explained to them.
The Problem-Solving Approach
Based on Huthwaite’s research, many of their multi-national clients now use a different appraoch to the new-product launch. Instead of giving Features and Advantages when they announce a new product, they concentrate on explaining the problems the product solves.
Demonstrating Capability Effectively
Rackham points out three main practical points in this chapter that will help you demonstrate your capability more effectively in larger sales:
- Don’t demonstrate capabilities too early in the call. It’s important in larger sales to develop Explicit Needs–by using Implication and Need-payoff Questions–before you offer solutions.
- Beware Advantages. Don’t let previous training mislead you. In larger sales, the powerful statements are those which show that you can meet Explicit Needs.
- Be careful with new products. The first thing to ask with any new product is, “What problem does it solve?”. When you understand the problem it solves, you can plan SPIN questions to develop Explicit Needs.
Remember- The work you’ve just read is Neil Rackham’s. I have simply outlined his book. Most of the words above are his own. At times I paraphrased.
Until next time…
a Student of Sales