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What is Consultative Selling?
I know you may not have time to read a book or a thousand pages on the subject matter. Here in short, I am trying to give full clarity on what is consultative selling with the bigger picture. Because you are not going to teach anyone but reading my articles as part of self-development. So, it saves your time, is practical in our busy days and enough to have a clear idea. So, after reading this full article minutely, you can define what kind of selling you are involved in as well as others beside you. Now you can question, ‘How does it help me if I understand what kind of selling I am doing?’ The answer is it is important to do anything knowing it than remain in the dark. Also, it helps you to improve your style, and success rate and to avoid mistakes.
Consultative Selling became a buzzword. I came across many people who say that he/she is in Consultative Selling. It became a fashion but when I deep dive, I find most of them are not really in consultative selling. It may that some people think stating themselves as a salesperson is a little disrespectful. As if a salesperson means he/ she is not an expert of anything and has no core competencies. It may be partly right as what I often see is that people with no expertise come to the sales profession as it is open for all. And they keep on dragging as mediocre with some success as every product and every company has its own saleability. They really do not add value but do a rutin work.
On the other side, I feel selling is one of the most respectful professions. People who have high intellect and high level of knowledge and expertise in at least one subject are usually successful in this profession. A salesperson should be proud. It is a universal truth for each of the million companies across the globe that the entire company work to support a salesperson. Be it R&D, Production, HR, Admin, Shipping, management, Import, Export. Ultimately success of a salesperson with all these tailwind supports is the success of a business organisation. As well as, failure of a salesperson is not a jolt on him or her but for each of the multiple people and departments who supported him/her.
I can recall a story. In a town hall meeting the CEO asked the employees to raise hands who are who are driving sales for the organisation. Among around 500 employees only 40/50 raised their hand who are in the sales division. Then the CEO asked why others were not raising their hands. Everyone started looking at each other as they could not understand the meaning of the second question. Then the CEO explained, ‘I did not ask who has sales designation. I asked who are you driving sales for the organisation. In fact, everyone in this organisation is to drive sales and the business is built for selling and earning money and the same way earning for you’. What a great respect and importance of selling.
Also, needless to mention salespersons are on an average are highest paying employees in any organisation and higher honest earning is linked to higher respect, as we live in a commercial world where we need money in every aspect from maternity to funeral.
Before I answer what is consultative selling let us see what are the different kinds of selling styles and you can easily understand where one can fit himself/herself. As well as what are the different styles which can be defined as consultative selling. Before I start one confession is that there are many views and many definitions. What I believe is most practical, easy to understand and has a clear definition, I am explaining here as my view.
Classification of Different Styles
Selling can be classified in two segments. There is a distinctive line or barrier between these two.
Transactional Selling
Consultative selling
Transactional Selling
Transactional selling is mostly focused on one-time sales. To capture as many customers and achieve maximum revenue in a given time.
Consultative selling
Consultative selling mostly focuses on relation building (called Relation Selling also), making long-term bonding with a customer and providing products and services with can satisfy the customer best or rightly to say best value for money for the customers.
There are several sub-classifications in these two kinds of selling which I just touched upon below and you can see in the Picture also I have created for you for your easy understanding.
Sub-Classification of Transactional Selling
Three main Sub-classifications are explained below.
Professional Visitors
You must have seen many celebrities work in different organisations as consultants. And they sometimes visit a customer where the organisation bid for a big deal. Assume, the sales organisation finds it difficult to convince the customer as nothing very strong to convince in their favour or even getting an appointment The organisation and their competitors are at per as per customer. If Sunny or Kapil (or some rising stars) want to meet the customer, he/she may feel happy and out of the way accepts the proposal. Also, in case the organisation is marginally better or lesser than its nearest competitor, such a visit can help a lot to win the case. Besides this the customer get confidence that their purchase has a relation with the reputation of the celebrity visitor, so he/she may get the best services.
Price Seller
Sell on price. There are many equal products sold by several companies and customers prefer to go for the lowest or lower prices.
Like several mobile phones, consumables, and even several instruments, consumables etc where all are equally good or above acceptable quality.
Content Seller
Selling companies or sellers emphasize features. Many customers go for features or styles. Either they do not understand or do not care about the benefit. For example, Curve TV, Mobile upgraded models. I am not talking against the brand but for your easy understanding giving this example, are there much benefits in iPhone 13, 14, and 15? However many of my close people bought all these models whenever they were released spending all together 4/5 lakh.
Sub-Classification of Consultative Selling
It is also referred to as relation-based selling or need-based selling. Sub-classifications are very interesting and I am explaining below.
Need Satisfaction Seller
In this case salesperson uncovers the real need of the customer and creates a solution for it. Which helps the seller to start creating a trustful bond with the customer. Both, the customer and seller start thinking they are in a mutual beneficial relationship.
The salesperson starts to become a part of consultative selling at this point. Like LIC, Mediclaim policies and investment consultants, we often trust a person who understands the subject well and can give us the best solution. (I suggest that be careful, if he is not an honest seller, he can hide many factors and misguide you which is also very common, or I can say the majority happens like this. However, there can be many honest sellers beside you.)
Resourceful Expert
Deep knowledge of the subject, product and often creates value for the buyers. It is one one-step upgrade, and good product knowledge and industry knowledge are key to upgrading one from a ‘Need Satisfaction’ seller to a ‘Resourceful Expert’.
Loyal Champion
Here a seller is allowed to access inside information. That helps a seller and buyers to reach to a next level of solution with a higher trust level. Loyal champions often help customers to overcome their internal challenges also and to buy whatever is best for him/her going beyond the rigid rules and regulations.
Trusted Advisor
This is the highest level to which one salesperson can rise. Loyal champions as well as Trusted Advisor level of salespersons are usually responsible for selling high-end systems, closing big deals and having long experience in the same field. Often he/she and the customer know each other. It is a fact an intelligent customer can be very good in his subject but does not keep good knowledge about the products he uses or going to use. Here he/she trusts the salesperson has the best of the best knowledge and treats him/her as a teacher.
Reading up to this point, now my question to you. What do you feel that consultative selling is good or transactional selling is good? This is the big mistake many people do. There is nothing good or bad. It is as business demands and everything has pros and cons. Let me explain that also.
Pros and Cons of Transactional Selling
Transactional selling has several advantages. It helps to get quick and easy solutions. Helps quick revenue generation and less risk of investment.
The drawbacks are it may not be sustainable, treated as one time. Can be manipulative and damage customer’s trust, organisation’s reputation. Transactional selling may lead to losing loyal customers if transitional selling is applied where the person or organisation should apply consultative selling.
Pros and Cons of Consultative Selling
Consultative selling has many advantages, such as it makes bonding stronger between seller and buyer. Foster loyalty and retention.
However, the cons is this approach requires more time and expensive resources. Demands more Skills and training which also costs money.
What is the best-selling style that suits you?
If you are a frontline salesperson, it may not be in your hand. It will depend on what your organisation decide that they want to adopt which style.
If you are a sales leader then it is your responsibility to decide based on several factors. The factors are encapsulated in the above classification, especially the pros and cons of different selling styles. If your product and situation demand consultative selling but you adopted transactional selling for the quick result then your organisation may suffer in the long run. On the contrary, if you’re supposed to adopt transactional selling but you get involved in consultative selling then you may not get the desired result and waste time and money creating leads and satisfaction of customers.
This is the reason it is important to understand the different selling styles and adopt the appropriate one.
More or less, it is clear to you what is the classification of different selling styles. Now if you want to dig down more on consultative selling, I shall be writing one article exclusively on consultative selling. Keep watching this blog and you shall find the articles in a short time.
Happy selling!
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