INSIGHT SELLING and the CHALLENGER SALE
A primer
1 ⎥ Insight Selling and the Challenger Sale - A primer ⎥ http://www.straligence.com/2012/09/24/insight-selling/
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Executive summary
Customers don’t need
you the way they used
to.
Over the last three decades, B2B selling has evolved from a transactional (product-price) approach, to a
relationship-based process, and to a solutions-based model. Today, this way of selling is being challenged by
procurement-savvy teams that cut the grass under your best sales reps’ feet.
p. 5
Solutions selling has
been the holy grail for a
long time…
Solutions selling is largely driven by suppliers’ attempt to escape a dramatically increasing commoditization of
their products and services.
p. 6
… but it has increasingly
become a burden to
both customers and
suppliers
Selling ever bigger, more complex, disruptive, and expensive solutions requires a lot of “discovery” time and
effort, from both sides. The result is a “solutions fatigue”: traditional, time-tested sales techniques have
become a burden to both customers and suppliers, and an alarming number of half-completed deals remain on
the table. This has lead customers to react and engage with suppliers in a very different way.
p. 7
Can one type of sales
rep make a difference?
Among different profiles of sales executives, the one that has a much higher chance of being successful today,
particularly in complex sales, is the “Challenger”. This is the one who uses a deep understanding of a
customer’s business to serve them and to teach them, pushing their thinking, and providing different views on
how to manage and compete.
p. 8
The characteristics of
Insight Selling
Insight Selling is about targeting customers that can act quickly and decisively, teaching them something new
and provocative about how to compete in their market. Messages are tailored to the specific metrics and
economics of the company and its key individuals. All along, the Challenger is in control of the sales,
pressuring the decision making cycle.
p. 9
The Insight Selling
conversation in practice
The best sales conversation present the customer with a compelling story about their business first, teaches
them a new perspective, connects this with their reality, and then leads to how it can be realized via unique
differentiating capabilities.
3 ⎥ Insight Selling and the Challenger Sale - A primer ⎥ http://www.straligence.com/2012/09/24/insight-selling/
p. 10
Executive summary
The advantages of
Insight Selling
By proactively proposing a solution tailored to specific customer needs and leveraging your unique
capabilities, you are more in control. You are likely to gain faster widespread buy-in, to increase your chances
to win the deal, while gaining the loyalty and respect of your customers.
p. 11
Think about the
possibilities
Insight selling gives you a “Blue Ocean” way of competing where you are in the lead of customer proposals
and you play by your own rules.
p. 12
Winning at Insight
Selling requires specific
capabilities
Insight selling requires ad-hoc resources, processes, and tools in strategic planning, marketing (insight & ideas
generation), sales and HR. Only a handful of large, often international, players are capable of hosting these
capabilities in-house, particularly in terms of insight generation and the relative ability to create innovative
proposals underlined by a deep industry and customer knowledge.
p. 13
How can you build these
capabilities?
Choosing the right build, buy, rent and partner model depends on the economics of your business, the breadth
of your target markets and your ability to enter an adjacent business in a sustainable way.
p. 14
Partnering
Partnering with a management consulting firm could be the most effective shortcut to building insight-selling
capabilities.
p. 15
4 ⎥ Insight Selling and the Challenger Sale - A primer ⎥ http://www.straligence.com/2012/09/24/insight-selling/
The problem
Customers don’t need you the way they used to.
Over the last three decades, B2B selling has evolved from a transactional (product-price) approach, to a relationshipbased process, and to a solutions-based model. Today, this way of selling is being challenged by procurement-savvy teams
that cut the grass under your best sales reps’ feet.
Our legacy
The new reality
B2B used to be about relationship, product, and
solution selling
Armed and skilled customers make you come
short in the sales cycle
• Since the 1980’s, best practices in B2B selling and marketing
moved away from the traditional transactional and then
relationship-based approach to a more solutions-oriented one.
• In the current economic environment, B2B customers have
learned to buy with greater care and reluctance than ever
before.
• Sales reps have become experts at discovering customers’ needs
and at selling them “solutions” based on a relatively complex
combination of products and services.
• With increasingly sophisticated procurement teams and the help
of procurement consultants, B2B customers can readily define
solutions for themselves.
• Part of the deal is to find and nurture an “anchor” within the
customer organization who can help navigate the company and
drive the deal to completion.
• According to a recent study*, nearly 60% of a typical purchasing
decision – researching solutions, ranking options, setting
requirements, benchmarking pricing, etc. - is completed before
even having a conversation with your sales teams.
• The whole process is focused on attaching your company’s
solution to a customer problem, on justifying why it is better
than the competition, and on providing “evidence and
reference” to the expected benefits.
• To win a deal, you have to get ahead of the RFP. But even if you
can, it is increasingly no longer sufficient. It is very likely that you
will not get away of the RFP process and that you will have to
play by rules set by your customers, or its procurement
consultants.
• Relationships continue to be key, but good relationships are
more the result and not the cause of successful sales.
5 ⎥ Insight Selling and the Challenger Sale - A primer ⎥ http://www.straligence.com/2012/09/24/insight-selling/
(*) CEB research, 2012 – Panel of 1,400 companies
The problem
Solutions selling has been the holy grail for a long time…
Solutions selling is largely driven by suppliers’ attempt to escape a dramatically increasing commoditization of their
products and services.
The product-solutions selling continuum
Silo-Based
Product Sales
Most companies have the ambition to be
positioned as solutions providers
Product
Bundling
Advice &
Service WrapAround
Needs-Based
Product
Customization
Customer
Process
Enhancement
Fully
Integrated
Partnership
Product
Selling
Solutions
Selling
Nature of
relationship
Supplier reacts to purchase orders
Supplier viewed as a trusted advisor
Selling
skills
Strong knowledge of product portfolio
Boardroom-level engagement with customer
Customer
expectations
Quality product / service at good price
Strategic insight on the customer’s business
A shift to solution selling results in customers’ expecting you to actually “solve” a real problem and not just to supply a reliable product.
This implies that you not only understand the customer’s underlying problems or challenges as well if not better than they do themselves, but also
that you can identify new and better means of addressing those challenges, articulate clear benefits form using limited resources, and determine
the right metrics to measure success.
6 ⎥ Insight Selling and the Challenger Sale - A primer ⎥ http://www.straligence.com/2012/09/24/insight-selling/
Straligence, Adapted from CEB research, 2012
The problem
… but it has increasingly become a burden to both customers and suppliers
Selling ever bigger, more complex, disruptive, and expensive solutions requires a lot of “discovery” time and effort, from
both sides. The result is a “solutions fatigue”: traditional, time-tested sales techniques have become a burden to both
customers and suppliers, and an alarming number of half-completed deals remain on the table. This has lead customers to
react and engage with suppliers in a very different way.
Solutions Fatigue
Customer buying trends
The solutions-based discovering process
has become a burden
Customers have been taking initiatives and four major trends are
emerging
• What is keeping you up at night? What are your
competing challenges?
• The problem with providing an answer to these
questions is that it can often take the feel of a
protracted ping-pong match between the supplier
and the customer.
• The customer explains their needs, the rep
summarizes their understanding, the customer
confirms whether or not the rep got it right; a
proposal is made, the customer reviews and amends
it, and on and on.
• This requires a huge amount of customer
involvement at an early stage… before they see any
value.
1
Consensus-based sales
2
• The payoff of complex solution is
uncertain and C-level executives
increasingly require the widespread
support of their teams in a large
purchase decision. This leads to
even longer selling efforts to align
the interests of all involved parties.
3
Greater demand for customization
• A solution approach implies that
customers look for an offer that is
tailored to their needs. They see
customization as part of the
solution, and do not intend to pay a
premium for it. To the sell-side, this
implies longer times and higher
efforts and costs.
7 ⎥ Insight Selling and the Challenger Sale - A primer ⎥ http://www.straligence.com/2012/09/24/insight-selling/
Increased risk aversion
• The uncertainty of a pay-off in large
and complex deals pushes
executives to ask for a shared-risk
and reward agreement. Here the
lead KPI is the performance of a
customer’s business, not the one of
the supplier’s product or service.
4
The rise of third party consultants
• Customers increasingly rely to a
neutral third-party to “extract
maximum value” from the purchase
decision, i.e. help them reduce the
risks, costs and complexity linked to
the solution. Needless to say, this
adds pressure to the sales rep and
can extend the sales cycle.
Straligence, Adapted from CEB research, 2012
Searching for a solution
Can one type of sales rep make a difference?
Among different profiles of sales executives, the one that has a much higher chance of being successful today, particularly
in complex sales, is the “Challenger”. This is the one who uses a deep understanding of a customer’s business to serve
them and to teach them, pushing their thinking, and providing different views on how to manage and compete.
Sales Profiles
The Relationship
Builder
The
Problem Solver
The
Hard Worker
The
Lone Wolf
The
Challenger
• Builds & nurtures
strong advocates in
the customer
organization.
• Generous in giving
time to help others.
• Gets along with
everyone.
• Highly reliable in
responding to
internal and external
stakeholders.
• Detail oriented.
• Ensures that all
problems are solved.
• Always willing to go
the extra mile.
• Doesn’t give up
easily.
• Self-motivated.
• Interested in
feedback and
development.
• Tends to follow own
instincts instead of
the rules.
• Self-assured.
• Difficult to control.
• Always has a
different view.
• Has a deep
understanding of the
customer’s business.
• Loves to debate.
• Pushes the customer.
25%
39%
7%
Top performers
12%
17%
The highest percentage of top sales performers is found under the Challenger profile
High
Low
Complexity of
sales
In complex environments, the Challenger is by far the profile that is most likely to succeed. The Relationship
Builder is highly unlikely to succeed in complex sales environments.
In environments with low complexity, the most successful profiles are the Hard Worker and the Lone Wolf.
8 ⎥ Insight Selling and the Challenger Sale - A primer ⎥ http://www.straligence.com/2012/09/24/insight-selling/
INSIGHT SELLING
Straligence, Adapted from CEB research, 2012
Insight selling
The Characteristics of Insight selling
Insight Selling is about targeting customers that can act quickly and decisively, teaching them something new and
provocative about how to compete in their market. Messages are tailored to the specific metrics and economics of the
company and its key individuals. All along, the Challenger is in control of the sales, pressuring the decision making cycle.
Insight vs Solution Selling
Traditional solution selling is based on finding a hook to a
recognized need. Insight selling challenges the customer
and makes it aware of unknown needs.
Solution Selling
TARGET
• Targeting based on the potential for change, not to
buy. Focus on customers that can act quickly and
decisively, that are not paralyzed by structures or
relationships that hamper change.
• Firms where demand is emerging, pushed by
organizational or market/industry drivers.
TEACH
• Delivering insight that reframes the way customers
think about their business and their needs.
• Teaching customers something new, thought
provocative, and valuable about how to compete in
their market.
TAILOR
• Communicate sales messages in the context of the
customer, focusing on customer value drivers,
economics and performance indicators.
• Messages are tailored to different types of functions
and individuals within an organization.
TAKE
CONTROL
• Using control, diplomacy, and empathy, the Challenger
pushes the customer out of its comfort zone, focusing
on the value added, not on price discounts.
• Challengers pressure the customer’s decision making
cycle to reach a decision more quickly and kill
‘indecision inertia”.
Insight Selling
Target
customer
Has a clear vision and
established demands.
Is agile, has emerging
demands, or is in a state of
flux.
Info
requirements
What need is the customer
seeking to address?
What unrecognized need
does the customer have?
Engagement
timing
After the customer has
identified a problem that the
supplier can solve.
Before the customer has
pinpointed a problem.
Focus of the
conversation
Ask, understand the
customer’s need and find a
“hook” for your solution.
Offer provocative insight
about what the customer
should do.
Flow of
information
Asking questions so that the
customer can steer you
through the purchasing
process.
Coach the customer about
how to buy, and support it
through the process.
9 ⎥ Insight Selling and the Challenger Sale - A primer ⎥ http://www.straligence.com/2012/09/24/insight-selling/
Insight selling
Insight selling in practice
The best sales conversation present the customer with a compelling story about their business first, teaches them a new
perspective, connects this with their reality, and then leads to how it can be realized via unique differentiating
capabilities.
The insight-based sales pitch
Warm up
1
Reframe
2
Build credibility:
“I know your
world”
• Present industry
challenges
experienced by
similar companies.
• Introduce your
assessment of the
customer’s key
challenges.
• Leverage
benchmarking.
Rationalize
3
Surprise with a
new perspective,
making them
wanting more
• Introduce a new
perspective that
connects challenges
to either a bigger
problem or a bigger
opportunity than
the one the
customer ever
realized.
Leverage Fear
Uncertainty &
Doubt via data
based on value
drivers
• Lay out the
business case why
the new
perspective is
worth considering.
• Leverage data that
directly connects to
the customer’s
economic drivers,
i.e. present ROI in
terms of solving the
challenge, not on
buying a solution.
Present what’s
needed
Bind emotionally
4
Make the
customer see the
challenge
/opportunity as
their own
• Paint a picture of
how other
companies went
down the same
road by connecting
the pains in the
story to the pains in
the customer
organization.
10 ⎥ Insight Selling and the Challenger Sale - A primer ⎥ http://www.straligence.com/2012/09/24/insight-selling/
5
Why your solution
is unique
6
Present the
capabilities
required to seize
the opportunity
• Point by point
review of the
specific capabilities
the customer would
need to grow, to
save money, or to
mitigate risks.
Demonstrate
how your
solution is better
than anyone
else’s
• Introduce the
capabilities that are
truly unique to your
organization and
that can help the
customer seize the
opportunity and/or
face the challenge.
Insight selling
The advantages of Insight selling
By proactively proposing a solution tailored to specific customer needs and leveraging your unique capabilities, you are
more in control. You are likely to gain faster widespread buy-in, to increase your chances to win the deal, while gaining
the loyalty and respect of your customers.
Before the deal
After the deal
You proactively pitch to your own unique strengths
Insight selling strongly drives customer’s loyalty
Accelerate
time to
decision
• Much of the heavy lifting is done before
individual reps go in front of the customer,
considerably reducing “solution-fatigue”.
Increase and
accelerate
widespread
support
• With a pitch tailored to the specific interests of
the company, those who most benefit from it
become your internal advocates and allies within
the customer organization. They help you sell
your proposal to the different stakeholders.
Increase your
chances of
winning
Take control
Greatest
drivers of
loyalty
•
• Supplier has widespread
 Helps me avoid
support across my organization
potential land
• Supplier is easy
• Helps me shorten mines
to buy from
the buying cycle
 Helps me
 Offers unique,
navigate
valuable
alternatives
Matches
perspectives on the
communication
the market
to my
• Collaborates with
preferences
 Educates me on new
other suppliers
issues and outcomes
• Portrays a realistic
DECISION
MAKERS
• Excels in
diagnosing our
specific needs
• As you craft a proposal that combines customer’s
challenges and your unique capabilities, you are
less likely to go through a competitive bid, incl.
the formalities of the procurement department
and/or third parties.
• As you are being proactive, you are more in
control of the sales process, guiding the
customer on how to make it happen.
picture of purchase
costs & difficulties
• Remains readily
accessible
• Supplier adjusts to
Weakest
drivers of
loyalty
• Proactively
our unique needs and
specifications
• Helps me improve
my professional
standing and meet
KPIs
 Provides ongoing
advice or
consultation
 Helps me
quantify
financial
value
• Advocates for me within
the organization
accelerates decision
making
• Demonstrates a
high level of
professionalism
Weakest drivers of
loyalty
Greatest drivers of
loyalty
END USERS AND INFLUENCERS
11 ⎥ Insight Selling and the Challenger Sale - A primer ⎥ http://www.straligence.com/2012/09/24/insight-selling/
Straligence, Adapted from CEB research, 2012
Insight selling
Think about the possibilities
Insight selling gives you a “Blue Ocean” way of competing where you are in the lead of customer proposals and you play
by your own rules.
Imagine if you could:
• Know your customers’ industry as well as, or even better than, they know it themselves.
• Combine the strengths of a management consulting and research firm with your unique business capabilities.
• Trigger a series of workshops together with key customer executives to challenge the status quo and imagine new opportunities.
• Proactively propose insightful solutions to multiple industries and customers, widening your portfolio of opportunities and increasing
your win rates.
• Keep competitors at bay by proposing solutions that strongly fit your unique capabilities with the economics and operational/growth
targets of your customers.
• Turn the sales process upside-down by having customers come to you for your unique advantage instead of having your sales-reps
make cold calls.
Imagine if you had the insight and capabilities of
a management consulting firm in your go to market model.
12 ⎥ Insight Selling and the Challenger Sale - A primer ⎥ http://www.straligence.com/2012/09/24/insight-selling/
Organizing for Insight Selling
Winning at Insight Selling requires specific capabilities
Insight selling requires ad-hoc resources, processes, and tools in strategic planning, marketing (insight & ideas generation),
sales and HR. Only a handful of large, often international, players are capable of hosting these capabilities in-house,
particularly in terms of insight generation and the relative ability to create innovative proposals underlined by a deep
industry and customer knowledge.
Area / Function
Strategic
Planning
Capability / Requirements
• Differentiating capabilities that are clearly defined, understood and
communicated.
• Target industries and customers segmented also based on needs.
• Ability to leverage insight and supporting data across industries and markets.
Insight & Ideas
Generation Machine
(Marketing,
Sales, R&D,
Operations, Accounts
Mgmt, etc.)
• Ability to generate and quantify customer-specific insight, incl. competitive,
financial, operational challenges.
• Innovation capabilities to define a new point of view on the customer’s business,
products, business model, etc.
• Ability to quantify the economic impact of your proposal on your customer’s
bottom line.
• Ability to define the impact of your proposal on your customer’s organization.
• Processes and sales metrics adapted to insight selling.
Sales
• Sales culture supporting insight-selling and “Challengers”.
Post-Sales
• Performance metrics and processes that include a link to the customer’s business
or operational performance.
• Recruitment process optimized to hire “Challengers”.
HR
• Marketing and business development staff capable of supporting sales rep in the
identification of new opportunities and the generation of new insight and proposals.
13 ⎥ Insight Selling and the Challenger Sale - A primer ⎥ http://www.straligence.com/2012/09/24/insight-selling/
Multinational
player
Large national
player
Small – Medium
player
Organizing for Insight Selling
How can you build these capabilities?
Choosing the right build, buy, rent and partner model depends on the economics of your business, the breadth of your
target markets and your ability to enter an adjacent business in a sustainable way.
Description / Example
Issues, who is it for
Build
• Recruit industry professionals and consultants in view of
creating a dedicated team responsible for generating insight
and supporting your sales reps.
• Equip the team with the industry databases, knowledge
tools, and processes required to perform their analysis.
• Time and effort required to build the team and
supporting processes and tools.
• Suitable if you are restricting your activities to a highly
specialized niche market.
Buy
• Acquire a specialized consultancy with the skills and
resources to generate insight in the markets you compete in.
• Acquire and extend the industry databases and knowledge
tools required to generate insight.
• Potential cultural mismatch jeopardizing your
effectiveness and return on investment.
• Suitable if you are restricting your activities to a specific
market and have a high-margin business justifying the
investment.
Rent
• Partner with a consulting firm that is capable of covering
your industries with rented resources and tools.
• Ad-hoc collaboration, typically on a time and material basis.
• Address conflicts of interest cased by the core business
of the partner, i.e. consulting activities with your target
customers.
• Suitable for ad-hoc, large strategic pursuits, and new
market / services development.
JV / Alliance
• Relatively independent go-to-market JV leveraging the
capabilities of the consulting firm and your key
competences.
• Collaboration based on a shared risk-revenue model.
• Willingness of consulting firm to limit its services to your
company and your markets.
• Suitable if you cover a large number of customers in
multiple industries.
14 ⎥ Insight Selling and the Challenger Sale - A primer ⎥ http://www.straligence.com/2012/09/24/insight-selling/
Opportunity
Partnering
Partnering with a management consulting firm could be the most effective shortcut to building insight-selling capabilities.
INSIGHT-BASED GO TO MARKET
Your teams
Consulting firm’s
services
Solution specialists
Ad-hoc research
on customer
industries,
markets and
customers
Marketing and
business development support
Sales
Co-development
of insight with
your marketing,
sales and
technical staff
Development of
industry thought
leadership
collateral for
sales & marketing
efforts
Facilitation of
innovation
workshops with
your customers
and your staff
On demand, based on your specific needs
Collaboration
mode
Medium to long term partnership linked to a specific industry / market
Partnerships – Joint Venture
15 ⎥ Insight Selling and the Challenger Sale - A primer ⎥ http://www.straligence.com/2012/09/24/insight-selling/
Collaboration
with your teams
on proactive
proposals and
on answering
competitive bids
www.straligence.com
16 ⎥ Insight Selling and the Challenger Sale - A primer ⎥ http://www.straligence.com/2012/09/24/insight-selling/