The B2B world can be a complex and daunting place for inexperienced operators, with sophisticated & often ‘bullish’ buyers calling the shots on what’s in the best interest of their supply chain or provide the most streamlined solution for their end-user clients.
Compared to ‘day-to-day’ transactions, B2B transactions & deals are often much larger in volume & value than that of B2C and can take a lot longer as the commitment needs to be gained & approved through multiple levels of the organisation.
It’s true that in the B2B world the 80:20 principle applies, where Pareto outlined that 80% of your revenues will come from 20% of your customer base. Meanwhile, the other 80%, which is bringing in 20% of your revenue will undoubtedly take up 80% of your time and resources – so how do you get the mix right?
Understanding the fundamentals & challenges is a great place to start. Here are a few things to consider when you’re navigating through the world of B2B.
What are you really selling?
Gone are the days of selling widgets, even products or services in B2B. Although your business may literally sell widgets, you are selling a solution.
B2B sales is all about providing a solution to your customers, being both your direct customer and their end user. Be it cheaper, higher, faster, better, easier – you are inevitably selling the solution.
While B2C consumers are often fickle in their decision-making, with little loyalty & switching based on the cost of products, B2B customers can be fiercely loyal. Simple gimmicks and sales tricks won’t work in the B2B market.
Be nice to everyone; you never know who can influence your sale
In B2B sales, you need always be aware of the ‘gatekeepers’ within an organisation.
While B2C consumers can see, hear and be influenced directly, in many cases B2B buyers and decision makers are protected by layers of subordinates & executive assistants whose exclusive role in the company is to keep people like you away – so how are you going to get through the door?
In addition to getting in and even through the door in many cases – especially if you are cold calling or new to the industry – it is often very difficult to understand who actually are the real decision makers, buyers or ‘shot callers’ within the organisation for what you are trying to sell them.
Buyers can vary depending on the size, scope, industry, market, it is not simply a case of people titles being ‘buyer’ or ‘purchasing manager’ anymore. Even if you play golf on a Saturday with a senior executive of a company, it doesn’t necessarily entitle you to a sale in this day and age – process & personal service are key.
In later articles, we will discuss how you can navigate the B2B minefield and identify key buying stakeholders including a potential weapon—the mobilizer/change agent.
Understand the buying cycle
When it comes to B2B buying cycles, you can be waiting a long time before locking in a sale.
Unlike consumer markets – such as FMCG or clothing, who enjoy huge volumes in stock turn – the B2B buying cycle can take weeks, months even years in some instances, and this needs to be factored into the price as your business strategies are formulated.
The time involved is often impacted by the potential costs and perceived risks associated with your offering. For example, if you are selling mining trucks or pens there would be substantially different cost/benefit analysis and due diligence in the purchasing process between the two items & their application for your potential customer’s supply chain.
Remember who you are selling to
Typically, B2B buyers are often not concerned with the solution but more so how it will meet their own strategic and even possibly their personal priorities. So always be sure to remember this when diving headfirst into an explanation regarding how “end users will love our products because….”, your B2B buyer may not care one iota.
Buyers, procurement managers and other key decision makers in the B2B purchasing process may not care too much past their own incentives or divisional budgets, let alone the end user.
Remember to flesh out ‘what is important’ to the person you are selling to, what are they looking to achieve and how can you and your solution solve a problem for them, their business and their end-user clients – as they are the ones paying the bill.
Does size matter?
An age-old question, but in B2B sales – absolutely it does!
When dealing with SMEs or start-ups you’ll find their buying habits to be more like that of the B2C market, as they are nimble and not driven so much to be top-down protocols, but proactive thinking – this could play to your advantage.
Meanwhile, larger organisations will have structures, protocols and often multiple sign off points within their company as well as often longer payment cycles that could have a bearing on your operations, so when looking to target these large businesses, remember that it may be a while until this prospect bares fruit.
So where to from here?
B2B is a rewarding industry for all involved, with long-term partnerships that can allow your business to flourish. To successfully navigate the B2B space, you need a plan, the skills and guidance to provide a sound platform to build your success.
For regular insights, trends and approaches to help you win in B2B markets, sign up today to Listen Innovate Grow – the blog for owners and managers of start-ups and SMEs looking to grow & thrive within B2B markets.