In today’s ever-changing business world, start-ups and SMEs are storming ahead with viable, usable and often disruptive solutions for seemingly every customer demand. Within many of these operations, the ‘end user’ or B2C market is seen as king, with almost an infinite market size.
The downside to this is that with massive market size; comes massive market competitors, market forces and infinite customer demands. As a start-up or SME, it is virtually impossible to meet the needs of the entire market and hedge against competitors and risks that are dominant in the space.
That is not to say it can’t be done; it most certainly has been done successfully with Australian-based start-up companies such as ‘AfterPay’, ‘Canva’ and ‘Freelancer.com’. All three of these tremendously successful start-ups have solved problems for end users and become large market forces in their own right. However, they have all got one thing in common – they are all selling to the B2B markets!
Going into most fast food outlets, you have the choice of at least ten shelves, with four or more varieties of soft drink on them, so over forty different soft drink offerings to meet every consumer need – this is a cold hard fact within the B2C market.
In B2B markets, “research shows that for individual consumers, a greater choice isn’t necessarily a good thing. While B2C is becoming more individualised, customised and targeted, B2B offers a unique opportunity for start-ups and SMEs to offer a more standardised approach to solutions.
There is a misconception that B2B sellers are empowered, “armed to the teeth with information and clear about their needs…they may be better informed than ever, but CEB research shows that they’re deeply uncertain and stressed.
So, what does this mean for start-ups & SMEs looking to drive business growth? Here are some of our tips for start-ups and SMEs.
Think beyond consumers
There is a huge world of B2B customers just waiting for you to offer them a solution, often to a problem they didn’t know existed. Through tailoring a solution to B2Bs, start-ups and SMEs can save marketing, sales & operational dollars and manpower by being more targeted in their approach.
B2B sales forces SMEs & start-up companies to funnel their efforts as mentioned above into a more focused target market or group of customers, rather than the ‘mass market’ approach, that a B2C solution needs to get similar traction. This leads to more efficient and effective efforts and application of resources.
This methodology of thinking beyond consumers & meeting the needs of the business buyer is a concept we will discuss in more detail in subsequent posts, but it is one that is a cornerstone of B2B success.
Eric Ries in his 2011 book “The Lean Start Up” showed not only start-ups & SMEs but also large organisations alike how to be lean, nimble and be proactive in the market. Selling into B2B allows start-ups and SMEs to ‘pivot’ their business model more quickly to adapt to market needs, customer requests and specific requirements of users. While in B2C land, this adaptive approach is much harder to take on board.
In addition, the ‘Lean Canvas’ methodology is perfect for B2B sales as it is targeted to specific areas, groups or regions with a ‘full blown’ marketing/sales campaign. The ‘Lean Canvas’ methodology is focused on learning, developing and adapting all elements of the marketing mix (7 P’s), while not spending all available capital in the market, just a small segment – then moving on to the next area once success has been realised and lessons learned.
B2B sales are ripe for ‘customer stickiness’, which basically means that there is an “increased chance to utilise the same product or service that was bought the last time period”.
In order to get ‘long-term’ and sustainable growth, customer stickiness is perfect for SMEs and start-ups, as the same customers are buying the same (or similar) products ongoing. These are usually done through the application of ‘subscription services’, ‘value adds’, ‘accessories’ etc.
B2B suppliers – such as CRM juggernaut Sales Force – offer a complete, integrated system for small, medium and large businesses in terms of customer relationship management. Where B2B suppliers excel compared to their ‘cloud based’ CRM competitors is the additional training, webinars, reporting and value adding services. The additional features are considered critical for their B2B clients in the successful running of their business creating customer stickiness, loyalty and long-term, mutually beneficial partnerships – not simply one-off transactional relationships.
Through stickiness, getting lean and working to relieve the pain points of the ‘B2B’ client, start-ups and SMEs can not only develop into new markets, reduce marketing & sales spend as well as operational inefficiencies, but potentially open new product & service ‘pivot’ opportunities that may have never existed before.
Why should you want to get B2B ready? Because the end user consumer is fickle, never loyal and has little to no switching costs when moving away from your product or service. B2B markets rely on your solution to relieve pain points, increase efficiencies and relieve stress throughout the organisation.
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.
 “More Isn’t Always Better,” by Barry Schwartz, HBR, June 2006