Marketing Stamina and the Single Target Market

B2B, budget, Marketing, Marketing Stamina, Product Management, segmentation, single target market

Marketing stamina is all about being able to last out in a market, while you take time to get in and dominate.

The single target market is a starting point within a market niche which you aim to pick up and dominate till you aim for the next one.

P&G or Unilever both have products which wash clothes. But they have an independent brand Tide / Rin ( P&G / Unilever ) which washes clothes white and Ariel / Surf ( P&G / Unilever) which removes stains from your coloured clothes.

Such large companies with massive marketing muscle, still go after one market at a time and generally create different brands to ensure a clear differentiation.

But the clearer objective is to concentrate all their energies to target one segment / one niche / single target market. By concentrating all your energies to focus on just that one market, you don’t divert your energies in trying to be everything to everyone. What that ends up doing is giving you more freedom rather than constraint to think creatively about various ways to meet the customer.

Since you only have to focus on one set of prospective clients, you then find the most convenient and cost effective ways to reach out to them and find the best messages which resonate with them, resulting in quicker market penetration. This means your funds which you budget as part of your market stamina can last longer and you have a much higher chance of success.

Till next time then.

Carpe Diem!!!

Marketing Stamina – Revisited

B2B, life time value, Marketing, Marketing Stamina, persistence

On the 28th of October last year I had put up a post on this topic. If you are interested, you can have a look at it here .

The reason I felt a need to revisit this topic, came up because, I was analysing the average time it takes to get traction for a new product or service in the B2B market. If you are in the technology market space I would highly recommend you read the book Crossing the Chasm by Geoffrey Moore. It will give you a more detailed context to what I am talking.

However coming back to the B2B market – the key issue that needs to handled is corporate inertia. In most cases the people in these companies are fighting so many battles, that they don’t want to touch anything that’s not broken. Also because there’s so many approvals involved, they don’t want to risk the product / solution Not Working in their environment. Especially in case of technology solutions, most companies prefer to work with “n-1” technology because it’s stable and working. They don’t want one more fire in their hand.

The other thing which plays a role in my opinion, is that the customer wants to see your resilience. They don’t trust anyone approaching them new, for the same points as I listed above and in most cases they are already covered with an existing vendor who is providing decently good service. So until and unless the incumbent screws up some time soon, they won’t look at you.

So does it mean that you can’t get into business for the B2B segment.

You absolutely can, if you can plan for the long term. You ensure that you have enough persistence and finances to last you for a long duration. While I learnt the term marketing stamina from Dean Graziosi, I learnt the application of this idea through Dean Jackson. His thought process is like this – if you know the turnover rate of any market – say 5% – 10% of the people will change to a new vendor every year – and you have a focussed list of 1000 prospects then over the next 5 years at least 250 – 500 prospects.

Now depending on what you sell and what is the Life Time Value of a client, you will need to have the staying power to last through the 5 years with consistently reaching out to these customers. If you don’t plan for this, you will be in for a rude shock and you will do things out of desperation, which is never a good thing.

Till next time then ….build your marketing stamina before getting into a new market.

Carpe Diem!!!

Playing the Devil’s Advocate in B2B sales to realise higher prices

B2B, compelling, Customers, Sales

I have a major challenge pushing my sales people to sell at a higher price. They always have a pushback on the price saying the customer won’t buy. And we have big arguments.

Is this something you face. Is it difficult for you to charge a higher price for your services. Do you always end up losing orders, because your price is “high”

One technique, which I have shared to a small extent earlier also, is to play the devil’s advocate with the customer. There’s a caveat when you want to use this technique – you have to be sure that you provide the best services. If not, then first go and put your house in order. Learn to provide the best possible services at whatever price that you think is good.

With the devil’s advocate you make the customer convince you that she wants to do business with you. If the customer is able to convince you, then she can, internally, within her organisation, also convince people. Most of the times in B2B scenarios, the customer is surrounded by so many vendors who are all trying to say one of two things – I am the cheapest and / or I am the best. And the customer doesn’t believe any of them. In addition a lot of times, the person who is representing the customer, is also not clear why she wants to go after the solution. Most often its because someone higher up in the “pay grade” has asked them to find out.

So some of you would already be squirming that it’s not possible to raise the value of your offering. Just be with me for a minute and try this in your next meeting.

So first of all start with the first WHY – why are you wanting to do ‘this’ – whatever it is that they have asked you to come for, to discuss. Then you get to the second WHY – why is ‘this’ important in the bigger scheme of things in your business.

The third WHY starts to get you to figure out the value from a business perspective – WHY are you considering ‘this’ kind of a solution, couldn’t you have done it way cheaper by doing ‘that’ where the ‘that’ is an alternate and much lower price way to solve a problem. A very simplistic example of this would be – what are you wanting to buy a truck for, when you can use a bullock cart to transport the goods at a much lower cost. This will get the customer to come out, with what it is , that is key to them – a truck can carry longer distances faster and we want to get our products to de delivered to the farthest parts of the country. A bullock cart would take months and our competition will capture the market during that time.

Now you are getting a feel of what is important to them – long distance travel, fast.

Now comes the fourth WHY – I get your reason for not considering a bullock cart, but why are you wanting to consider our 10000CC trucks (just a a random figure) when you can have cheaper 5000CC trucks (another random figure) . At this stage if she says Yes we are considering 5000CC trucks and they are happy with that option, then they will expect your price to come closer to the 5000CC option and you will only play a losing game.

On the other hand if she says, I understand that the 5000CC trucks are cheaper, but their ability to drive continuously is limited to 3 hours while we would prefer if the truck can be driven continuously for 7-8 hours, then you now have different playing field. And you have not had to convince her.

You need to remember that in B2B scenarios, you are looking at professional buyers, who do buying all the time and want to compare you always with the lowest priced option. And you can keep trying to convince them of the value you bring but they won’t get convinced. However once you make them come out with the issues themselves, it becomes a lot easier since they are now providing all the compelling reasons.

Till next time then.

Carpe Diem!!!

The Concept of Value in services – 4

B2B, services, Value

Have you noticed that a can of Coke/Pepsi or any similar drink, costs different in a store like Costco , different in a vending machine and different when you are watching a movie in a theatre (it could be the fountain version instead of the can). For all practical purposes its the absolute same thing, except that in case of the fountain drink, its freshly made. But the price difference that you pay could be more than 10 times for the same volume of drink.

How’s that possible. Its because of the value in the eyes of the customer. If you are at a subway / metro platform and you suddenly feel very thirsty, you can’t wait to take a trip to the Costco/Walmart store and pick a pack of 6 cans. You know, that for the cost of the can from the vending machine, you can buy 6 cans, but you still buy it. The key is convenience. You are getting a chilled can , where you are, when you are thirsty, so you can quench your thirst right there.

Now lets look at the cost of the drink when you buy it at the multiplex, whether its a can or from the fountain. Its even more expensive than the vending machine. How come?

Its because of two factors – first, you are in a closed environment where there’s no other vendor selling the drink – so there’s no competition, its a monopolistic situation for that location. You cannot come out of the multiplex to find a vending machine near the multiplex, take a can and go back in. Most movie theatres don’t allow outside food and drinks inside their premises.

Now the second point – when you go to the multiplex, you are with your family or with your boy/girl friend on a date. You don’t want to be seen as stingy. You want to enjoy your time, you want to also want to show-off. So you buy the popcorn and you take the large drink because the popcorn will make you thirsty, even though you know its way expensive.

Now there are all kinds of customers you will face for your services as well. One customer may prefer to carry a can, in her bag, so in case she feels thirsty, she can take it out of the bag and drink it. It may not be chilled, but she is saving money. These kind of customers will always want you, to give them the lowest price of the services and say they will take care of the rest.

Then there’s another set who is okay with paying for the convenience if there’s a definite benefit. This kind of customer will expect you to do the “whole” thing for her on a turnkey basis even if it costs more on the components but she does not take a chance of something failing. A lot of B2B customers fall in this category because they don’t want to have situation where something doesn’t work because one of the separate components doesn’t work. You can charge a substantial amount of money because the customer values the fact that you will ensure that things will work. This is the concept of System Integrator in B2B companies or a media house.

The highest value is being in a kind of a monopolistic situation – but it can cut both ways. So, as an example, if you are the only company which can provide services on a specific kind of a product, then you get to charge a price which is much higher than the market. So if you are in a niche which is large for you to make money but small or fragmented for your competitors, then you can make a lot of money.

On the other hand, and this is the downside, if that product on which you are selling services, stops selling, then your business comes to an end. A lot of movie theatres had to close shop because of the Covid restrictions as an example while the Costco/Walmart or vending machines continued working.

If you are making enough profit then you can survive and have the marketing stamina to get into other markets if one market starts collapsing. So as a practice try to create your services such they are more convenient for the buyer or where you can be in a monopolistic situation.

Till next time then.

Carpe Diem!!!