Selling in B2B versus consumer sales

B2B, Business, client management, Sales, Trust

Most books in sales that you get int he market are written by people who have sold houses, or FMCG products with cater to the psychology of the end consumer. So they have tricks to handle objections and ways to close the sale. The advantage for the consumer sales person is that the market is generally huge. So if you can find a pattern with a few sales, then you are on to big commissions. The other side of the coin is that the consumer market is grossly populated with so many brands already, that it takes an enormous amount of energy to break into the market.

On the other hand the B2B customer is difficult to enter because companies have massive processes to enrol a new vendor and there is a huge amount of inertia to go through the process to get a new vendor. Since I have been involved in doing B2B sales for all my career, I have had so many situations, where, inspite of spending multiple years on trying to break into an account, we were not able to enter the customer. This is especially true for large companies. With SMB, it is relatively easier but still a process.

The key reason for this inertia is the fact that no one wants to have a “failed project” with a new vendor. There’s a lot of peer pressure in an organisation and people are looking at opportunities to ‘showcase a failure’.

It’s also very rare that you have a product or service which is very unique and you are the only provider of that service. Actually if you are the only person in the market, then chances are that there is No Market for your product or service, otherwise someone would have found it. I have also gone into market with a unique technology and failed because customers weren’t willing to take the risk with a unique technology.

Geoffrey Moore had written a wonderful book and come out with a unique idea on “Crossing the chasm”. As per this it takes enormous amount of energy to propel a new technology from the “risk takers” to mass adopters. It’s similar to a rocket needing tremendous energy to get out of earth’s orbit and again needing enormous energy to enter the orbit of another planet. Most unique technology products fail because they don’t have the energy to cross the chasm.

But having said that, once you enter into a B2B customer and you successfully execute the first couple of orders, then it will be very difficult to dislodge you. It’s the same logic that I had mentioned earlier, now being used to your advantage. Since managers don’t want a failure and you have successfully showcased that you can be relied upon and trusted, they will want to keep working with you.

You may have some hiccups with some new managers coming in or the organisation getting resized or re-engineered, but if you have built relationships across different functions, then these things can generally be managed more easily.

The other advantage in B2B is that most of your competitors are known and you figure out how they will react to what situation. This allows you to choose your sweet spot in the market and then just stick to it.

If you have any queries on B2B sales/marketing – do drop in your question and I would love to se if I can be of help.

Till next time then.

Carpe Diem!!!

The Value of a Lead

B2B, follow-up, lead generation, life time value, Marketing, Risks, Trust

Have you analysed the time it takes for someone who enquires something that you offer and eventually buys. And what is the Life Time Value of a client.

Not all leads will buy anything at all, some will buy, but not buy from you. But those who do buy from you, do you have an estimate of the amount of time it could take at an extreme for a lead to close.

About 10 – 12 years back, there was an MNC , who was into selling CPU chips, had come to us. Their sales team had a clear mandate from their management, if a lead was not closed in 3 months, it had to be pulled out of the funnel and dropped. Like us, they were also dealing in B2B.

Since we deal in considerably large value deals, it sometimes takes us even 24 months of effort to keep the lead live, to eventually come to us.

The timeline is an important aspect in deciding when a lead needs to be stopped from being targeted. One argument is never. To a certain degree, I agree with this argument. At the other extreme is an argument that if someone doesn’t buy in 3-6 months, then they will not buy. With companies running their sales and revenue targets from one quarter to another following a lead for more than 6 months is tough, because after 6 months the sales person may change.

Generating a lead is tough enough and losing it because you have an ad-hoc timeline to decide when to dump a lead can be devastating for the business. Depending on the kind of offerings you have, the more expensive the offering, the more people take time to think through their decision because, in the B2B segment, people can’t afford to Not Have Things Work. And because they still don’t trust you or the technology, they don’t want to take a decision. That’s where all the inertia and indecision comes-up.

You need to patiently nurture leads by educating them and motivating them to try you out (if they are engaging you for the first time) by doing POCs ( if its a complex technology) and eliminate all the possible risk from the buyer.

Once you have analysed the timeline of closing leads, then they will become an asset which will I’ve you annuity kind of business.

Till next time then.

Carpe Diem!!!

Education to build Trust

B2B, education, education, Marketing, Trust

In the last two posts I had written about building trust and reducing fear in the B2B marketplace.

One of the best ways to build trust is to educate the customer. But you can’t educate the customer if you cannot think like them and understand the conversation going on in their mind (Robbert Collier said that). Only if you can understand the questions they could have, when wanting to buy something for which you have a product / service , will you be able to educate them.

In B2B scenarios typically cycle times are quite large, especially for things which are part of a plan. There are some things which are needed because of some emergency and get done quickly. Otherwise the work on a B2B project could start about 3-6 months before they actually place an order.

Depending on the size of the companies you are targeting, the level of the person who would be looking for the information will change. Also in very large organisations, they may actually employ specialised consultants for helping them on certain decisions in choosing vendors.

The other challenge is that until you have some amazing new Hitech gizmo, chances are that they may already have a vendor providing those product or services . If that be the case, then the kind of education that you will need to provide also changes.

Today information is available freely to everyone. Large companies employ hundreds of employees, some of whom can be tasked to do the research and fetch the information. What is needed by the leaders is actionable guidance. This makes the task of educating a B2B customer tougher.

If you provide products or services that are widely available and the customer already has an incumbent, then your education should be directed more towards educating for creating dissonance. Typically all the issues that you have seen customers face before they started using you.

Till next time then.

Carpe Diem!!!

TRUST & FEAR IN B2B – 2

B2B, education, education, Fear, Marketing, Trust

In my earlier post on this topic I spoke of the challenge for a new vendor to enter into an organisation. But there’s a positive side of this story. Once you enter the organisation and do a good job and the customer starts trusting you, then you will stay in that organisation for a very long time. Decisions in organisations are rarely impulsive, therefore they will always prefer to go with the vendor who is an incumbent and whom they trust.

So how do you build trust & reduce the fear-

Ideal situation is when you have enough other customers vouching for your product or service. If they are from the same industry as the prospect you are targeting, even better.
Provide continuous education on what’s new and what they could be missing – there are three things in this sentence. First is “continuous” – you have to be reaching your prospects regularly and creating an impression in their minds, so that when the time comes and the incumbent is not in a position to provide them the service, they reach out to you. The Second item in the sentence is – “What’s new” – keep talking about the new technologies, new case studies etc. so that the customer understands that you are doing a lot of work and others are trusting you. And the last item is on “What they could be missing” – with their existing supplier – this is to create a wedge, start a cycle of dissonance with the incumbent. This could be a simple thing like talking about how at each of your other customers’ premises you provide a dedicated project manager to ensure smooth operations. Now if the incumbent is not providing this facility, then the customer will start getting a feeling of missing on a service.
Always be upfront in what you can do very well and what you can’t do. When you first get a chance – it could be a trial or a Proof of Concept, never do anything in this phase which is not your best item. Only when the prospect gets convinced at this stage, will they decide to move forward with you.

Out of the three points above, with marketing you can systematise the second point and ensure that there is constant education happening for the prospects. This background activity will slowly result in your name becoming more familiar. With familiarity, some amount of trust starts developing. As the trust starts getting built, they may start inviting you to discuss on things which they are coming up with to see if they can accommodate you.

Till next time then……

Carpe Diem!!!