Sales people are frequently confronted by this question on sales calls, along with some others like "why should I buy from you/your company?" or "what makes you different?". In fact, as identified in my last post, they have probably spent a lot of time at "Product Knowledge U" learning exactly how to answer these questions. In reality, answering questions like these usually end up putting you on the defensive and will not give you the advantage you are hoping for.
Think about it for a minute... if you answer that question you immediately sound like all of the sales people that have come before you, as well as those who will follow you. By answering the question you create "sameness" and a belief in the mind of the prospect that you are just like everyone else. You must also consider that everything you say will be considered as "sales fodder" and is often listened to with skepticism and from an "oh sure" perspective.
Obviously, there are many different situations in which this questions can be asked. Are they currently buying this product from someone else. Is this a product they have bought in the past, or is it a product they have never bought? Knowing which situation you are in will help you determine how best to proceed. Rather than answer the question, you might want to say "I'd be happy to tell you but I'm curious, is this a product that you have used in the past or are currently buying?". Their answer will be a valuable piece of information from which we can plan our next question.
If they are currently using or have had past experience, it would make a lot more sense to find out what they have used in the past. If they are looking to make a change "what would they like to see different?" This is a questions that would get us information that would begin to form our offer, or identify that we don't have what they want. Remember too, if they are not buying or have not used before, giving away your information can now become a shopping list that will allow them to compare you to the competition and "commoditize" your offer.
Not always, but often times the best answer to a question is another question. By not answering the question but rather asking:
"Was there something that you were hoping would be better?", or
"if we could offer something different or better what were you hoping for?"
With these questions you end up with the chance of finding out exactly what they are looking for and can craft your response based on the feedback you get.
It takes some courage and emotional control to respond this way but you'll find it will put you in an entirely different light with your prospect. Stop answering "what makes you better" and you'll get better information that will help you make more sales!