AI startups are running into more and more competitive bake-off situations as the AI market matures; while last year’s buyers were mostly early adopters eager to get their hands on a new tool, this year’s buyers are taking a more considered approach, routinely evaluating multiple vendors.
When sellers aren’t prepared to handle bake-offs they typically make one or more of the following mistakes and botch the sale:
Knocking the competition — “Oh, we win against them all the time”, “I’ve heard some horror stories about them” etc. While sellers think this persuades buyers to favor them, the reality is it just makes them trust them less.
Excessively talking up your product — “We have everything they have, and more! Let me tell you about it…..”. As with sales in general, the more you dominate the conversation talking about your product, the less you learn about what your buyer actually cares about.
Unnecessary discounting — “We’ll beat anyone on price”. Unless you are selling a pure commodity, price is seldom the top criterion for buyers. You’re just negotiating against yourself.
Instead, use the following steps to stack the odds in your favor:
Use a rubric to determine the evaluation criteria
Use the evaluation criteria to position against the competition
Optimize the evaluation process
Focus the evaluators on the evaluation criteria
Use a rubric to determine the evaluation criteria
When your buyer mentions they are looking at multiple options, resist the urge to start knocking the competition, talking up your product or talking down your price. Instead switch into a consultative mode by helping set the rubric: