Commodity Selling vs. Value Selling

Attribute	Commodity Selling	Value Selling
Focus	Product features and price	Customer needs and benefits
Approach	Transactional	Consultative
Relationship	Short-term	Long-term
Customer Perception	Price-driven	Value-driven
Sales Process	Focus on closing the sale	Focus on solving customer problems

Introduction

When it comes to sales strategies, two common approaches are commodity selling and value selling. While both aim to sell products or services, they differ in their focus and techniques. In this article, we will explore the attributes of commodity selling and value selling, highlighting their key differences and benefits.

Commodity Selling

Commodity selling is a sales approach where the emphasis is on selling products based on their price and availability. In this model, products are viewed as interchangeable with competitors' offerings, leading to a focus on price as the primary selling point. Salespeople in commodity selling often rely on discounts and promotions to attract customers, as the product itself does not offer any unique value proposition.

• Focus on price and availability
• Products seen as interchangeable
• Reliance on discounts and promotions
• Competitive pricing strategies
• Less emphasis on product differentiation

Value Selling

Value selling, on the other hand, is a sales approach that focuses on the unique value proposition of a product or service. In this model, salespeople emphasize the benefits and advantages that their offering provides to customers, rather than just the price. Value selling involves understanding the customer's needs and demonstrating how the product can meet those needs effectively, leading to a more consultative sales process.

• Focus on unique value proposition
• Emphasis on benefits and advantages
• Customer-centric approach
• Consultative sales process
• Building long-term relationships

Key Differences

One of the key differences between commodity selling and value selling is the focus of the sales approach. Commodity selling prioritizes price and availability, while value selling emphasizes the unique value proposition of the product or service. This difference in focus leads to distinct sales techniques and strategies that salespeople employ to attract and retain customers.

Another important difference is the relationship between the salesperson and the customer. In commodity selling, the interaction is transactional, with the salesperson primarily focused on closing the sale. In contrast, value selling involves a more consultative approach, where the salesperson seeks to understand the customer's needs and provide tailored solutions that add value.

Benefits of Commodity Selling

Commodity selling can be beneficial in certain situations, such as when customers are price-sensitive and looking for the best deal. By focusing on price and availability, salespeople can attract customers who prioritize cost savings over other factors. Additionally, commodity selling can be effective in competitive markets where differentiation is challenging.

• Attracts price-sensitive customers
• Effective in competitive markets
• Simplicity in sales approach
• Quick sales cycle
• Opportunity for volume sales

Benefits of Value Selling

Value selling offers several benefits that can lead to long-term success and customer loyalty. By focusing on the unique value proposition of the product or service, salespeople can differentiate themselves from competitors and build stronger relationships with customers. Value selling also allows for higher margins, as customers are willing to pay more for products that provide significant benefits.

• Builds customer loyalty
• Differentiates from competitors
• Higher margins
• Long-term success
• Customer satisfaction

Conclusion

In conclusion, commodity selling and value selling are two distinct sales approaches with their own set of attributes and benefits. While commodity selling focuses on price and availability, value selling emphasizes the unique value proposition of the product or service. Both approaches have their place in the sales world, depending on the market conditions and customer preferences. Ultimately, understanding the differences between commodity selling and value selling can help salespeople tailor their strategies to meet the needs of their customers effectively.