Identifying the dissonance for engaging a B2B customer

B2B, Business, competition, Marketing, Marketing Stamina, messaging, persistence, segmentation, single target market

With B2B customers, as I have mentioned earlier in my earlier posts, its difficult to get instantaneous decisions because of various reasons. These could vary from inertia to customers having to do cross functional team decisions, budgets and the works.

In most cases until the dissonance with the existing supplier is so large and repeated that the customer can no longer bear it, they don’t change. However in a bundle of 1000 prospects, the Dean Jackson “inevitability principle” eventually kicks in and some incumbents falter and that’s when you get a chance to stake your claim.

Now you need to be in front of the customer to stake your claim. In addition you should, on a consistent basis keep highlighting the possible challenges the customer could be facing.

For this you need to know your competition well. Competition could be from a company or an alternative technology. You need to understand the places competition is weak and then work your messaging to highlight the challenges the customer could be facing because of the those issues. These messages need to be about “rubbing salt over their wound” so that the pain gets even more highlighted.

Its not always possible to know all the challenges until you ask the customer and then hypothesize for others – since you have already focused on a narrow segment of the market. So if you get in front of a customer on the phone or in person or via web you need to check if they value the benefits that you offer versus what the incumbent does not have. You will then realize for yourself if those benefits matter to a decent set of your audience.

Once you have done that then the the key is to be persistent because we don’t know when the customer will decide to change. Also since customers do more than 60% of their research in the sales cycle even before they call the vendors, if you are not in front of them when they are doing the research, you won’t even get considered.

Till next time then.

Carpe Diem!!!

Single Target Market – Determining the viability in B2B

B2B, Business, differentiation, Marketing, Marketing Stamina, persistence, segmentation, single target market

I have consistently been harping on the fact that you need to find a niche in the market and a market in the niche. Finding a market in the niche is the critical part in determining if the market is even worth looking at. This is not about prioritizing on the different niches. Its about discarding a niche all together. Please understand that B2B buying is generally not impulsive. Which means you need to play this game over a long term.

For priortising of niches we will have a separate discussion.

Criteria for the B2B segmentation / niche viability

Your average deal size – recurring or one time
Gross Margin
Number of addressable prospects in the niche

Lets look at bundles of 100 or 1000 addressable prospects and I will share a simple model to do a quick calculation of the viability of the market.

Lets say you have a B2B prospect base of 100 and each deal is worth $100000/- per annum recurring. Which means the whole market is worth $10m per year and over a 5 year period if you were to be able to pick up 20 clients you can get a revenue of more than $20m cumulative approx. That’s a good market to be in, because with referrals and other things put together this market may actually end up being very large. Even at a 20% gross margin in 5 years you would make about $4m.

On the other hand if your average size deal was only $1000/- per annum recurring, then the market in 5 years may not be more than $200 thousand. Even if you make 50% gross margins, you will make at the end of 5 years about $100K.

So depending on the size of your average revenue you decide if the size of the niche is viable. The same $1000 product in a niche which has 1000 prospects could be worthwhile over a 5 a year period if you were able to pick up an share of 20% of the clients.

I have found that looking at a bundle of less than 100 tends to be scary because you don’t know how many of the clients will actually move away from their incumbent vendors. From a 100 prospects, Dean Jackson’s inevitability principle will lead to around 20 prospects in 5 years coming your way because some incumbent will make errors and if you are in front of the customer on a regular basis they will end up calling you just because they see you as persistent. A lot of time people don’t have the marketing stamina to last that many years.

Try working with this model and let me know if you found this useful.

Till next time then.

Carpe Diem!!!

B2B messaging – Using Triggers – 2

B2B, Business, differentiation, Marketing, messaging, persistence, single target market, Triggers

Yesterday I wrote about one of the best triggers that I have found in B@B messaging, when someone joins in a new role from outside the company in the executive position.

There are multiple other triggers that can be used based on the environment the company is operating in.

New regulation / compliances in the industry which everyone has to comply with especially if followed with a time limit
Going out / End of Life – of a license/regulation – again if there is a time limit it is even more critical
Entry of a new competitor in the market
Entry of a new technology
Impact of an event on a competitor and how it can apply to them
Global crisis and many more….

The reason I addressed the “new joinee trigger” as an independent post yesterday was because I have found that to be the most effective. With the above triggers the challenges are seen as more long term and people may not react to your messaging immediately.

Apart from the timing issue the other challenge is again related to targeting the right person in the organsiational matrix with the messaging for the above.

If you have been following my blog, I have given so many tactics for messaging whether its with dissonance or now with triggers or earlier with pain areas and aspiration areas.

The reason you have to test for so many different types of messaging is because you don’t know what kind of messaging will invoke a response from which prospect. You have to keep persisting with trying various options continuously.

So keep testing.

Till next time then

Carpe Diem!!!

Creating dissonance in the B2B buyer’s mind – Part 2

B2B, Business, Marketing, Marketing Stamina, persistence

In my post of 12th April I had written about how B2B sales are not impulsive in nature. If you’re selling something which is a hot new technology and the buyer is a technology fan then you might be able to sell based on just the technology being new.

On the other hand , most B2B businesses have different levels in a buying process for any kind of product or service, especially if you are looking at a mid to large to extremely large companies. In these kind of companies the inertia itself is very large and the processes complex, so getting a process initiated itself is a task.

So until and unless there is a real challenge with a vendor no one wants to change, even if you have done the perfect segmentation and identified them as your ideal customer.

In the post on 12th April I wrote about how your messaging should keep targeting some areas of dissonance. However you cannot create dissonance with one piece of messaging, it will never stick. The longer a vendor has been providing the services to an organisation the bigger is the chance that the vendor’s issues will be ignored. Also not all issues – using an example from calculus – tend to cross the limit/threshold – where the customer snaps.

So when entering with a regular product or service you need to look at a long term time frame of say 2 years – it could be longer depending on the product or service – airplanes as an example – people may take 5-10 years before deciding on moving from say Boeing to Airbus .

Then you need to keep at sending out a weekly mail/postcard or whatever to be in-front of the buyers so that when the limit / threshold is reached they call you out by default. This persistence in marketing or as Dean Graziosi calls it – Marketing Stamina helps you pick up business in the long term.

Till next time then.

Carpe Diem!!!