The Challenger Sale: Taking Control of the Customer Conversation

The Challenger Sale: Taking Control of the Customer Conversation

by Matthew Dixon, Brent Adamson

The Challenger Sale is a guide to implementing a B2B sales model within your organization that is focused on value-based, solutions-oriented sales following significant changes in sales and customer buying behavior. Matthew Dixon and Brent Adamson have found that the most successful sales reps adopt a Challenger approach, where they teach, tailor, and take control of the customer conversation. You can implement this model by enhancing the skills and behaviors of your sales team as well as improving your organizational capabilities, with a focus on leading with insight.

Summary Notes

The Evolving Journey of Solution Selling

“Essentially, some flavor of solution selling has become a dominant sales strategy across almost every industry.”

The challenge of securing sales in a recession is a major issue for sales leaders. In the past 10 to 20 years, the solution-selling approach has become the most popular sales strategy to address this problem. Solution selling is a transition from traditional transactional sales based on price and volume to consultative sales of product and service bundles.

Solution-selling requires the ability to engage fully with B2B customers to truly understand their requirements. This facilitates the design of unique, sustainable, and tailored sales solutions. Well-designed solution bundles maintain premium pricing and provide a competitive edge as they are differentiated from traditional product and service offerings. The ultimate goal is to become a trusted advisor to clients and deliver strategic insights for their business.

Customer buying behavior is ever-changing, so you need to adapt your solutions approach accordingly. Consensus-based sales, where senior decision-makers look for approval from the team in choosing a supplier, are rising. Customers are more concerned about risk and return on investment; there is a greater demand for customized products and services and an increase in third-party consultants who are looking to drive down supplier costs.

Sales representatives have to overcome these obstacles, so they need to have the right skills in order to apply the solutions-based approach. As this sales approach is more complex, the gap between star and core performers will inevitably widen. Establishing a strong, highly-skilled, and customer-focused team is critical to business success.

Actions to take

A New Model for High Performance

“Which skills, behaviors, knowledge, and attitudes matter most for high performance?”

The world of sales and customer-buying behavior has changed over the past five years in response to suppliers selling larger, complex, and more expensive sales solutions. The downturn in the economy highlighted the widening talent gap between star and core performers. Studying your star performers provides critical information to enhance your core performers and add significant commercial value to your business.

The four main areas to consider when evaluating your star sales performers are attitudes, skills/behaviors, activities, and knowledge. Focusing on these core areas will enable you to identify the key traits of your most successful sales representatives. Personality types and strengths cannot be studied or assessed - this includes charisma which can be a key component to sales success. 

However, focusing on demonstrated behaviors provides a roadmap to solution selling via coaching, training, and tools to improve product and industry knowledge.

There are five main types of sales representatives: Hard Worker, Relationship Builder, Lone Wolf, Reactive Problem Solver, and Challenger. The Challenger profile is the most successful profile. Challengers ensure a deep understanding of their customer’s business, are keen to share their views, and teach customers something new and valuable to facilitate a competitive edge. Further, they are not afraid to discuss money or take control of the sales process. 

Challengers dominate in complex solution sales environments and not just during periods of recession. Solution selling requires the ability to propose a change to customers in terms of their behavior, rather than just selling them your products. Challengers build constructive tension across customer interactions to push the customer out of their comfort zone. Less complex, transactional parts of the business may be more suited to the Hard Worker profile, but if you are looking to move to value-based, solutions-oriented sales, you need to develop a strong team of Challengers.

Actions to take

Exporting the Model to the Core

“A Challenger is defined by their ability to do three things, teach, tailor and take control, and to do all of this through the use of constructive tension.”

Challengers are made, not just born. If you provide your team with the right sales tools, training, coaching, reward, and recognition schemes, they will be able to transition to the Challenger approach. The Challenger Selling Model works across diverse industries and company settings and the adoption of this approach has proven to be extremely advantageous for many organizations. 

A critical part of transitioning to this model is to ensure that the three pillars (teach, tailor, and take control, while leveraging constructive tension) are used as a combination rather than separately. If you teach without tailoring, then the customer will find this irrelevant to them. If you tailor but don’t teach, you will be viewed as no different from any other supplier. If you take control but offer no value, then the customer will lose interest quickly. Therefore, all three pillars must be used together for the Challenger Selling Model to be effective.  

Enhancing the individual skills of sales representatives is vital, but building organizational capabilities is just as important. The content of the teaching pitch, or how you teach customers the business issues to be valued, needs to be developed by the organization so that it is scalable and repeatable. You can leverage Business Intelligence (BI) and research to assist Challengers in tailoring their message for each industry and company. The organization should also be responsible for identifying which teaching messages resonate with different stakeholders. Challenger representatives will be able to take control of the customer conversation if they have powerful teaching messages.

Building a Challenger Sales Force requires considerable change for the organization as well as the behaviors and skills of individual representatives. This can take years, rather than weeks or months. If you rush this process, then sales performance will undoubtedly suffer and sales representatives may view this rushed process as a quick fix. The Challenger model is essentially a completely new operating system for the commercial organization.

Actions to take

Why Insights Matters

“What sets the best suppliers apart is not the quality of their products, but the value of their insight – new ways to help the customer either make money or save money”

Challengers succeed by having a better understanding of their customers’ world than the customer themselves. Rather than just asking the customer what they need, they teach customers what they need and as a result, build customer loyalty. Customer loyalty can be gained by selling a well-branded, highly differentiated product, supported by optimal service standards. 

It is vital to invest in your brand, product, and service, but if your competitors adopt the same approach, B2B customers will not be able to differentiate between suppliers. 

The Challenger approach to customer loyalty is for the customer to keep buying from you, increase this over time, and advocate for you across their organization. Customers may find it difficult to differentiate suppliers based on product, brand, service, and pricing, but they do identify huge differences in the sales experience. Loyalty is won during the sales call, so it’s important your Challenger representatives use the right approach.

Here are seven approaches that representatives can apply to boost customer loyalty:

  1. Offer unique and valuable perspectives on the customers market

  2. Support the customer to navigate alternatives

  3. Provide ongoing advice or consultation

  4. Help avoid potential landmines

  5. Educate the customer on new issues and outcomes

  6. Ensure the sales process is easy, smooth, and uncomplicated

  7. Secure widespread support from multiple customer stakeholders

The first five attributes relate to an urgent need for the customer to learn something rather than just buy a product. You need to help suppliers identify areas they can cut costs, increase revenue, enter new markets and mitigate risk. Challengers offer compelling new perspectives to customers that are tailored to their needs. This resonates with them and drives them to action.

Customers are looking for suppliers that challenge their thinking and teach them something new. So, equip your Challenger reps with the skills to teach customers what they need.

Actions to take

How to Build Insight-Led Conversations

“If you were to map a world-class teaching conversation – or teaching pitch – you’d find it moves through six discrete steps, each building directly to the next.”

Once you have identified the unique benefits your organization has to offer and developed compelling insights to teach customers new ways to compete, then it is time to map your teaching pitch. There are six steps to developing a well-designed pitch, but you also need to ensure reps tell a compelling story to engage the customer and secure buy-in for their solution. This involves appealing to the customer on both a rational and emotional level. 

  1. The Warmer - After initial introductions, Challenger reps should provide an assessment of the customer’s key challenges to build credibility.

  2. The Reframe - Built upon the challenges presented, offer a new perspective that connects the challenge to a greater problem or bigger opportunity.

  3. Rational Drowning - Provide a number-driven rationale as to why you think the customer should think differently about their business and present this as a real concern for their operations going forward.

  4. Emotional Impact - Ensure the customer can picture themselves in the scenario that you are presenting so that this resonates with them.

  5. A New Way – Provide a concise review of the capabilities the customer would need to make the most of this opportunity to make/save money or reduce risk.

  6. Your Solution – Demonstrate how your solution is the best approach to achieve the objectives outlined in the previous five steps over your competitors.

The core lesson in the Commercial Teaching approach is that the customer views you as a supplier that can teach them something, not just sell them a product. Challengers need to present a compelling pitch that teaches customers something new and illustrates the unique strengths of your organization. The construction of this conversation requires input from the entire commercial organization. Sales functions need to provide knowledge, skills, and coaching to reps to enable them to challenge customers, and marketing teams can highlight differentiators and source new and compelling teaching messages.

Commercial Teaching offers the biggest opportunity to drive growth, as is not just focused on the products and services being sold, but the quality of insight provided during the sale.

Actions to take

Tailoring for Resonance

“Address each customer stakeholder as if he or she actually was the customer. Because in today’s world of consensus-based selling, that’s exactly who stakeholders are.”

Tailoring is recognized as one of the defining attributes of the Challenger rep and this is largely because of an increase in consensus buying due to the selling of more complex solutions to B2B customers. Here, consensus buying refers to how multiple customer stakeholders need to be on board before a purchase gets the go-ahead.

Decision-makers sign the agreement and are usually categorized as senior executives or procurement. A positive sales experience is important to them and they see themselves buying from an organization rather than an individual. The main approach you need to take is to build widespread support across their organization as they look for consensus from internal stakeholders. Decision-makers value new ideas to save/make money and ease of business over typical sales approaches involving pricing and customization.

Influencers and end-users play a key role in the purchase and are powerful advocates for B2B suppliers, despite not having the authority to sign the agreement. Non-decision makers are more focused on buying from an individual rather than an organization, with the biggest driver for loyalty being a representative’s professionalism – someone they can trust and believe in. They also strongly value being taught something they value, for example how to compete more effectively in their market. 

The best way to increase sales is to take an indirect approach to the decision-maker through stakeholders and build company-wide support for your organization. The connection between a stakeholder and decision-maker is stronger than a link between a rep and a decision-maker, so they can have more impact in terms of influencing the sale. You need to focus on identifying key stakeholders and equip them with supplier insight to drive more business in conjunction with building relationships with key decision-makers.

Tailoring the message is therefore important across different levels of the organization. This can be split broadly into the customer’s industry, person’s company, person’s role, and finally to the individual person. Challenger reps also tailor their knowledge to an individual stakeholder’s values, understanding the economic drivers of their business and what these individuals are looking to achieve. You, therefore, need to provide your reps with the tools and abilities to achieve positive outcomes at all tailoring levels.

Actions to take

Taking Control of the Sale

“Teach reps the importance of clarity of direction over quick closure and teach them how to create real value within the sales process.”

Challengers are comfortable talking to customers about money and they can also push the customer. This is because they are confident in the value that they can offer a customer, so they are able to push back if the customer asks for discounts or special terms. This confidence is underpinned by the Commercial Teaching message, where the Challenger has taught the customer about a problem and provided a tailored solution. Challengers create momentum as their goal is to push things along and close the deal.

These attributes are difficult for some sales reps to adopt as they go against a natural tendency to reduce tension, agree with customers, and not present problems. There are common misconceptions that taking control relates only to negotiations/money and encourages reps to be aggressive. Challengers take control across the entire sales process not just during the negotiation stage, they reframe the way the customer thinks about their business and they are assertive, not aggressive.

You need to provide coaching and training to reps to enable them to take control of the sale. A good place to start is to provide negotiation training and tools. Reps naturally want to quickly close a deal, but sometimes this can be to the supplier’s detriment. Challengers keep negotiation points and objections on the table longer and don’t cave into the demands of the customer. The Challenger responds to pushback by providing compelling insights, relevant data, and taking control of the debate. Once your reps have learned how to take control in a negotiation, they can then apply this assertive approach across the rest of the sales process.

Actions to take

The Manager and the Challenger Selling Model

“World-class managers today are defined not just by their ability to coach to the known, but by their ability to innovate around the unknown.”

Frontline sales managers act as a fundamental link between strategy and execution, so if you are looking to transform to the Challenger Selling Model then this role is vital in terms of making the model work. Manager quality is the most important lever for driving rep performance, so it is important to have the right person in this critical role.

If you are looking for sales management excellence then there are skills, behaviors, and attitudes to look for in order to identify the best candidate for the role. Management fundamentals, like reliability, integrity, and listening skills, are necessary for any management role. Sales attributes, namely selling, coaching, and business ownership, are the additional three key skill areas to look for when appointing your next Sales Manager.

Managers are expected to model great selling behaviors for their teams. Specific attributes in the selling category include offering the customer unique perspectives, tailoring the offer to customers, and being comfortable discussing money – also key attributes of Challenger reps. Coaching is another major element of manager effectiveness and a big driver of representative performance. Working closely with reps to share knowledge and insight as well as provide constructive feedback is vital. Finally, demonstrating ownership is key in terms of having a commitment to building the business going forward.

The most important attribute of sales leadership is innovation, where managers collaborate with reps to identify and troubleshoot any issues to move the deal forward. This approach involves modifying the deal strategy in line with the supplier’s existing capabilities and overcoming any customer obstacles. Sales innovation is key to realizing the Challenger Sales Model and innovative managers can support reps in selling complex solutions and closing deals with reluctant customers.

Actions to take

Implementation Lessons from the Early Adopters

“While the competition focuses its energies on finding customers, you will be out there making customers.”

Studying earlier adopters of the Challenger Selling Model provides a great insight in terms of assisting sales and marketing leaders to implement the model in their organization. One of the key findings is that not every high sales performer fits the Challenger profile. It is important to correctly identify Challengers within the team so you can observe how they are selling to customers. If you focus on the high performers, then you may be identifying the attributes of a Relationship Builder or Lone Wolf profile mistakenly as a Challenger. 

Lone Wolfs are high performers but they represent a small percentage of sales reps. They follow no pattern or processes, so it is difficult to model and replicate their behavior. Another issue is that they are not good in collaborative environments and can be disruptive. The top performers in this kind of environment may do well, but it’s not conducive to developing core performers too. Challengers can be built if they are provided with the right training, coaching, and sales tools. You should also look to recruit Challenger reps by focusing on hiring individuals who demonstrate the key competencies of the profile.  

Individual skills and organizational capabilities are best developed in parallel as this ensures effective and high-impact collaboration. You need to create compelling teaching messages and simultaneously improve sales awareness and skills across your sales team. Training is a major part of transitioning to the Challenger model, so it is important to develop high-quality training programs that are valued and that offer continued learning opportunities.

High performers in the organization should not be forced into adopting the Challenger approach. You should aim for 80% adoption and then advise the rest of the team if their performance slips then they will need to try the Challenger model. Expect some casualties, but if you champion your Challenger reps then it is likely the rest of the team will follow suit.

The Challenger approach can be applied across diverse markets as the fundamental concept is to bring insight to the customer. If you are working in non-Western markets, then it may be worth rephrasing some of the terminologies. Shift terms from teaching to sharing or add the word respectfully before using words like teach, challenge, or take control. 

Start now to implement the Challenger Selling Model. It’s not a quick fix but it is well worth the commercial transformation. Leading with insight, teaching customers about problems, earning more customer time, securing invitations to return, and promises to take action await. Your business will be making customers not just finding them.

Actions to take

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