What Is Solution Selling? (+ How to Measure Product Value)

What is solution selling? How can you determine if your solution truly delivers value to your customers?

Keenan’s book Gap Selling revolutionizes sales by introducing a practical framework for measuring and demonstrating value to customers. Keenan’s method focuses on quantifying the gap between a customer’s current state and their desired outcomes, helping sales professionals create compelling value propositions.

Discover a systematic approach to evaluating solution benefits, understanding implementation costs, and making data-driven decisions.

Evaluate the Value of Your Solution

Once you’ve revealed your customer’s underlying issues and their long-term goals, you’ll be able to quantify how much value your solution offers them. So what is solution selling? Keenan explains that measuring the effect of the solution will indicate how much your product is worth to your customer. The greater the value you provide, the more enticing your solution will appear to your customer, and the more it will be worth. He recommends three steps to calculate the value of the solution: measuring the benefit you provide, measuring the cost to the customer, and weighing the two against one another.

(Shortform note: While it may be tempting to overstate the value or undersell the costs of your solution, sales experts emphasize the importance of accuracy when estimating the costs or benefits of your proposed solution. They explain that accurate estimates will build credibility while creating realistic expectations with your customers. On the other hand, an inaccurate estimate could damage trust or make you appear less knowledgeable about their industry.)

1) Measure The Benefit

First, measure the value of closing the gap. Keenan advises calculating the specific differences between current state and ideal state using the key metrics that matter to the customer, such as revenue growth, close rates, or deal sizes. 

Let’s say you’re selling a new customer relationship management (CRM) software to a mid-sized sales team. Through your discovery process, you’ve learned that their current system is outdated, causing inefficiencies and missed opportunities. To measure the effect of your solution, you might calculate:

• Time saved per salesperson per day (for example, one hour)
• Additional customer interactions made possible (for example, five more calls per day)
• Improved lead conversion rate (for example from 10% to 15%)

The cumulative value of each of these improvements is what you present as the value of your software.

(Shortform note: In addition to using the metrics that are most important to your customer, you may also consider their preferred methodology for evaluating benefits. For example, many companies rely on a traditional calculation of return on investment (ROI). However, those interested in the long-term payback may be more interested in a payback period analysis. Firms that are more concerned about high uncertainty may rely on a Monte Carlo simulation to determine the probabilities of different outcomes. Understanding your customer’s preferred method may help you to present value in the terms that your customer finds credible and easy to understand.)

2) Measure the Costs

Keenan also recommends that you consider the costs and effort the customer will have to make to implement your plan. These include not only the tangible upfront costs, but also intangible costs like implementation time, organizational disruption, training, and compatibility with their current practices. 

In the example of the CRM software, you might want to consider factors such as:

• Software licensing fees (for example, $500 per user per year)
• Implementation costs (for example, $10,000 for initial setup and data migration)
• Training time (for example, two days of productivity lost per salesperson during onboarding)
• IT infrastructure upgrades (for example, $5,000 for additional server capacity)
• Potential temporary dip in productivity during the transition (for example, 10% reduction in sales for the first month)

(Shortform note: When estimating the time and effort your client needs to implement a change, it’s important to be aware of a cognitive bias called the planning fallacy. Psychologists explain: Most people have difficulty accurately predicting how long a project will take or how much they can achieve within a given timeframe. To counteract this bias, experts recommend using objective data points rather than relying on subjective prediction. Compare your project to similar projects in the past and base your estimate on how long those projects took—even if you believe it will go more smoothly this time.)

3) Evaluate the Benefits Against the Costs

Finally, weigh the costs and benefits to your customer. If the benefits exceed the costs, then you’re offering the customer real value, and you’ll work to demonstrate that value in your sale. If the costs exceed the benefits, then you’re unlikely to make a sale, and should refer the customer to someone else who may be able to help overcome their issues instead.