Buying Cycle – Sideline Goldmine

Last week I posted the first in a series blogs about how marketing and sales should engage with the customer’s buying cycle to uncover and align with opportunities from the prospective buyer’s perspective. This post delves into the first two steps of Sidelines and Awareness in the B2B customer buying process.

There are two distinct groups of prospective buyers with different characteristics:

1. Existing Customers who have bought something from you previously but are not considering any additional purchases.
2. Prospective Customers who fit your target market but have never bought from you before and not actively looking to buy anything related to what you’re selling.

The vast majority of your prospective buyers are on the sidelines not actively looking to buy anything related to what you’re selling. The opportunity is to move them to the next step of awareness using tactics such as:

• Monthly newsletters to existing customers and opt-in subscriber list that highlights the potential value of your various offerings.
• Educational white papers and eBooks to create awareness about the challenge or opportunity these companies face and potential solution approaches.
• Article marketing in relevant publications and online properties to create awareness and establish credibility.
• Regular webcasts with educational value to create awareness, develop thought leadership and establish credibility in the target market(s).
• Salesperson calls or visits to existing customers – not specifically to sell something – just being visible and engaged is a great way to generate awareness.

Prospective buyers in the awareness phase are aware of the general category or type of product/service/solution you are selling, but have not identified a need for it yet. The opportunity is to move them to the next step of interest:

• IMO, one of the most effective methods to stir prospective buyer interest is the “others like me” approach.
• Show them how other companies similar to theirs have solved problems and achieved greater success.
• Show them how others in roles like theirs have achieved personal recognition and success by making their companies successful.
• Use selected case studies and video testimonials specifically targeted to the interest you want to generate.
• Depending on the service/product/solution, assessment or benchmarking tools for prospective buyers to gauge themselves against best in class peers are also effective for generating interest to move to the next step.

What methods have you found to be effective for identifying and moving prospective buyers along the buying cycle in these early phases?

The next post explores the Interest, Research and Consideration steps in the B2B customer buying process.

Your comments are always welcome.
Copyright © 2009 The Marketing Mélange and Ingistics LLC. http://marketing.infocat.com

The Buying Cycle Disconnect

Talk to salespeople about their process to engage with prospective buyers and you’ll hear all about the sales methodology and sales life cycle they use. Marketing also has a life cycle for designing, developing, launching and executing campaigns plus another life cycle for managing, nurturing and distributing leads. These life cycles are all necessary and important.

However, these are all inside-out processes on how you want to engage with prospective buyers or how they should engage with you. That’s an unrealistic perspective.

Prospective buyers have their own buying life cycle that they will follow. Whether or not it’s a defined methodology, all B2B buyers will follow a similar process for acquiring whatever product/service/solution they need. Customers want to go through their buying life cycle processes and will buy when they are ready. You can achieve much better results by understanding and connecting with your prospective customer’s buying life cycle. I’m not suggesting you put the customer in the driver’s seat – sales still needs to manage and control the process, but to better align your marketing and sales processes with the buying cycle and the outside-in perspective.

Although buying cycles vary by industry, product, service, solution, etc. there are common processes that most buyers want to step through. The diagram to the right outlines the major steps in a generalized B2B customer buying process:

1. Sidelines – the vast majority of your prospective buyers are sitting on the sidelines, not actively looking to buy anything related to what you’re selling.
   
2. Awareness – prospective buyers are aware of the general category or type of product/service/solution you are selling, but have not identified a need for it yet.
3. Interest – the prospective buyer has identified a problem or opportunity that needs to be addressed and explores the issue in greater depth.
4. Research – the prospective buyer defines their requirements and actively researches a long list of possible solutions for the identified problem or opportunity.
5. Consideration – the prospective buyer finds suitable solution sources, gets more detailed information and does comparisons to compile a short list of possible solutions.
6. Decision – the short list solutions are evaluated in various ways including customer defined demonstrations, tests, in-depth analysis and other methods to find the most suitable solution. The buyer could also decide not to buy anything. Marketing is usually disengaged at this point.
7. Purchase – the purchase is made and everyone is happy for a fleeting moment. Sales usually disengage at this point.
8. Implementing – the implementation process to get the solution installed and working for the customer in the manner they expect. Vendor or third party professional services usually assist customers with this step.
9. Implemented – the solution is actively working for the customer. Vendor engagement with customers is primarily through support services from this point forward.
10. Achievement – the customer (hopefully) begins to realize the benefits they set out to achieve from the solution.
11. Loyal Customer – cultivating a satisfied and loyal customer has many benefits including additional purchases and referrals.
    

Although some of these steps in the buying cycle may seem beyond the interests of a marketing and sales discussion, I’ve specifically included them because they are frequently overlooked opportunities for marketing and/or sales to be engaged.

In the next several blog posts, I’ll delve into each step in more detail to explore how marketing and sales can engage more effectively and productively in the customer buying cycle to produce better results.

Your comments are always welcome.
Copyright © 2009 The Marketing Mélange and Ingistics LLC. http://marketing.infocat.com

How do you define Customer Value?

I’ve referred to customer value in several of my previous blog posts. The key point being that marketing should always clearly articulate the value of the product/service/solution within the customer’s context.

But what does ‘value’ within a customer context really mean and how do you define it? James Womack & Daniel Jones who popularized the Lean Enterprise business approach, define 6 attributes of customer value in their book ‘Lean Solutions: How Companies and Customers Can Create Value and Wealth Together’. Because these attributes of customer value are defined from the customer’s perspective, they can provide valuable insights for how we should position, message and market our products/services/solutions.

The 6 attributes of customer value defined by Womack & Jones along with my marketing perspective interpretations are:

1. Solve my problem completely – define exactly what customer challenges or opportunities your product/service/solution addresses, the extent to which it does, how it does it and how it works with other solutions. Don’t leave the customer in doubt or searching for additional information.
2. Don't waste my time – get to the point and don’t make the customer have to do things you want in order to get the information they want. Remember that their buying process takes precedence over your marketing or sales process – they’ll go somewhere else if you waste their time by making them jump through hoops to get information.
3. Provide exactly what I want – your product/service/solution should have packaging flexibility according to how customers want to buy, not how you want to sell. Make it easy for customers to buy just what they want right now – they’ll be more inclined to buy more subsequently.
4. Deliver value where I want it – clearly define at what point(s) in the customer’s business value stream your product/service/solution delivers value. Overly broad or vague claims of applicability and functionality don’t connect with specific customer requirements or how the customer envisions a solution that would benefit their business.
5. Supply value when I want it – not all your prospective customers are ready buy at the same time and definitely not immediately. The important issue here is to gear your marketing programs to the various time frames your prospective customers have for buying and helping them reach that point.
6. Reduce the number of decisions I must make to solve my problems – business customers buy something to solve a problem or pursue an opportunity. Offering too many choices, options and alternatives only makes things more complicated for customers to make a buying decision. Communicate with prospective buyers in their context and avoid unnecessary complications or decisions they need to make.

Remember that the interpretations for each attribute are just my views – think about how you would interpret these attributes to your circumstances.

“Value can only be defined by the ultimate customer’ – James Womack & Daniel Jones

Understanding and defining customer value is a key part of being outside-in as discussed in an earlier post. Considering these 6 attributes of customer value during our various marketing processes should help us connect more effectively with prospective buyers.

Your comments are always welcome.
Copyright © 2009 The Marketing Mélange and Ingistics LLC. http://marketing.infocat.com

You’re Selling What to Whom?

Here’s an interesting bit of low-cost research that could provide valuable insights into whether various people in your organization really understand your value proposition and market position. Ask two simple questions:

• What are you selling?
• Who are your buyers?

Start with the marketing and sales organizations. Ask the questions individually and record the answers verbatim. Doing this in person either face-to-face or on a phone call as an interview wherever you can provides additional insights to observe how people respond. A simple online survey can be used for people who can’t be reached personally. IMO, interviews are more effective than surveys for this type of research.

Besides providing the obvious measure of how well the market positioning, messaging and value propositions from marketing are understood, this little research project can yield interesting additional insights.

In response to “what are you selling?” IMO the only valid answers are those that describe what is being sold in the context of the value defined by customer. So, instead of the more typical answer of “I’m selling a world-class inventory management solution”, a customer value oriented answer might be “I’m providing our customers the means to increase their customer service levels by at least 10% without increasing their investment in inventory”.

"In the factory we make cosmetics; in the store we sell hope."
– Charles Revson (founder of Revlon Cosmetics)

The “who are your buyers?” is intended to determine who in your organization really understands the qualification characteristics of the right prospective buyers. Good answers should include the multiple dimensions of industry, market segment, company demographics, psychographics and buyer profiles of the individuals involved in making the buying decisions.

Ask the CEO, COO, CFO and other functional areas these same questions – you might be surprised by some of the answers.

For the only answers that really matter, ask your customers what value they perceived they were buying with your product/service/solution. Ask them who was involved in the decision process and why they made this choice.

You should have a lot of interesting data points and insights to reconcile from this project. Marketing is responsible for ensuring that the company has the right positioning, messaging and customer value propositions, but more importantly that everyone in the organization is in agreement and understands how this applies to their role.

Your comments are always welcome.
Copyright © 2009 The Marketing Mélange and Ingistics LLC. http://marketing.infocat.com

Trying to get a handle on Company Psychographics?

I received several emails in response to my last post ‘Do Psychographics work in B2B Marketing & Sales?’ about developing psychographic profiles for market segments or companies to complement existing demographic data.

Given that psychographics classify prospective buyers by psychological attitudes such as aspirations, interests, attitudes, opinions, etc., how does this apply to companies when you’re in B2B marketing and sales? IMO, companies do project a psychographic image or behavior pattern that goes beyond normal demographics – take IBM as an example signaling moving to a services-oriented business earlier this decade, followed by on-demand computing services mid-decade and the current focus on sustainability. For suppliers selling to IBM, those are powerful signals of what and how to position their solutions to IBM relative to how the company views itself in the market.

One email came from an ex-colleague and business acquaintance Charlie Allieri who is co-founder of iLantern, a provider of Sales Knowledge Management services. iLantern provides a service that monitors events associated with targeted companies to produce information alerts that signal activities that can influence sales opportunities at those companies. These events include executive staff changes, executive quotes, mergers, acquisitions, product announcements, alliances, awards, sales deals, business expansion, and many others.

Charlie’s point, within the company psychographic discussion, is that if marketing and sales were to analyze this event information more strategically, they could build a very insightful psychographic profile of their major customer and prospect companies. iLantern services primarily provide salespeople with really valuable and actionable current information and insights in their accounts, Charlie makes a good point that this information can also provide more strategic insights for marketing. Applying the information from a number of companies in a particular vertical industry or market segment can glean additional industry insights that are not reflected in any demographic data.

“No great marketing decisions have ever been made on quantitative data” – John Scully

Another really interesting part of the iLantern service for marketing is that you can automatically associate specific marketing materials and messaging with designated events for sales to take action. So, if a particular event occurs at a company in a target market segment, the service can alert the salesperson to invite the relevant person to a webinar, or send them a white paper, or mention a specific solution, or any scenario you wish to define. The salesperson gets the alert with a predefined script and email with the designated material(s) to contact the person in question at that company.

Company psychographics can give you a competitive edge in today’s tough market by identifying company events that signal a potential opportunity or to stop wasting time and resources on companies sending the wrong type of signals.

What do you think about this type of approach for developing and using company psychographics? Your comments are always welcome.
Copyright © 2009 The Marketing Mélange and Ingistics LLC. http://marketing.infocat.com

Do Psychographics work in B2B Marketing & Sales?

B2B marketers regularly use demographic data of tangible characteristics such as company size, industry classification, number of employees, etc. to segment and target relevant markets. While B2C marketers do use demographics, they also use psychographics to really understand what interests their prospective buyers. Psychographics classifies prospective buyers by psychological attitudes such as aspirations, interests, attitudes, opinions, etc. From a marketing perspective, demographics define what buyers commonly need whereas psychographics define what specific groups of buyers want.

From what I’ve experienced and seen, B2B marketers typically make little or no use of psychographics. The supposed issue is that you’re selling to a business, so there are no psychographics. IMO, that’s wrong and B2B marketers are missing out on connecting with the real context of their prospects and customers.

I see an over-reliance by B2B marketers on industry classifications (SIC, NAICS, NACE, etc.) and company size (revenue, employee count) demographic data for market segmentation without relevant psychographic qualification. A CEO/President of a $50m company doesn’t think of his/her business as ‘small’ – they may see the company an innovative market leader in their vertical industry and market. Their solution requirements may be very different from what the ‘small’ demographic typically defines. While the standard industry classification may tell part of the story, it provides you with same analysis as your competitors and no qualitative differentiation for defining your market segments. The point here is that the product, service, solution that a group of companies really want could be quite different from what the broader pack needs.

“Continue to surprise those who would put you in a neat demographic. Be insistently curious.” – Gordon Gee

The other aspect of psychographics in B2B marketing and selling is that your prospective buyers, influencers and decision makers are real people with psychographic profiles. The production manager may view him/herself as the de-facto COO with broader purview in the business, or the material planner may aspire to be the production manager. You need to market and sell to the views, aspirations and interests of the people who will ultimately decide whether or not to buy your stuff. Does your value proposition and solution support these views, aspirations, opinions and interests? The material planner, who is probably an influencer, will only support your solution if he/she can see it directly supporting their aspiration to be production manager.

You can’t just go out and buy psychographic data like we buy demographic data – it generally requires primary research. This is actually a good thing since the primary research will be tailored to your situation, providing valuable data and analysis to really differentiate yourself from competitors and connect more specifically with buyers in target markets. The primary research doesn’t have to be a major expense – a well constructed online survey can provide good data.

If you are a B2B marketer, do you use psychographics and if so, how do you collect the data, and how has this worked for you?

As always, your comments are welcome.
Copyright © 2009 The Marketing Mélange and Ingistics LLC. http://marketing.infocat.com

Breathing our own exhaust?

An ex-colleague who read my recent post ‘Are you Inside-out or Outside-in?’, sent me an email about an expression I use that he really liked – “are we breathing our own exhaust?”. This expression relates to being outside-in and the acid test we should always apply when we launch a campaign, write content or promote a specific value proposition – does this really create value for the customer within their context?

It’s all too easy to get carried away with all the internal hype from product management, development, marketing and other internal sources. Add to this management pressure to produce better results, time constraints for marketing to deliver, continual daily interactions between marketing team members, and we easily slip into blindly believing ourselves without outside validation – or to put it more bluntly – breathing our own exhaust.

Problem is, it’s not always apparent that we may have this problem, since we may be too close to the situation to step back and recognize it. However, if we don’t recognize it before the campaign, content or promotion is launched, we’ll inevitably face a mediocre result at best or abject failure at worst.

During the review process for any campaign, promotion, content or other marketing output, always ask questions to qualify whether it really connects with the prospective buyer within their context and current circumstances:

• What research do you have to support this?
• How was this tested?
• What did the test reveal?
• What outside-in validation do you have?
• What are competitors doing? How does this compare – what is different or similar?
• Ask the ‘breathing our own exhaust’ question – it’s a fun question that isn’t easy to answer and usually gets a good discussion going.

This is just a starter list of the type of questions to consider – develop your own to suit your circumstances. Be careful not make it feel like an inquisition; just ask good questions to do some constructive self analysis to ensure that the campaign, promotion, content, etc. is on the right track.

“The question should be, 'Is it worth trying to do?' not 'Can it be done?'” – Allard Lowenstein

An approach I particularly like that helps avoid the typical ‘breathing our own exhaust’ syndrome is to have a geographically distributed marketing team. That way, everyone has different daily exposures, interactions and perspectives and are less prone to breathing each other’s exhaust in the same location day in and day out. Having input from these different daily experiences will also add more value to the creativity and review processes.

Ask the ‘breathing our own exhaust’ question or your variation of it when something is being developed – ask yourself, ask you team members, ask the group.

Your comments are always welcome.
Copyright © 2009 The Marketing Mélange and Ingistics LLC. http://marketing.infocat.com