How B2B Businesses are Failing Existing Customers
The average B2B business spends 75% of the sales and marketing budget targeting users (of its products or services) and procurement agents, the two groups who have the least say in purchasing decisions. When these organisations do engage executives or the C-suite, they do so by inviting them to large, expensive events (see Oracle!) that executive customers don’t have the time to attend.
Surveys of CIOs have shown that they rate the input of their peers as the most credible and trusted source of information about products and services. In a year (2012) where 60% of CIOs surveyed aim to initiate new products and services for competitive advantage, how do organisations with this approach expect executive customers to learn about them, come to trust them and ultimately sponsor them throughout the organisation?
So, how can you be sure that your organisation doesn’t fall into this trap? Particularly, if you are a B2B organisation with a small group of highly valuable customers. Firstly, what are the signs that a change in thinking is due?
- Existing accounts are spending less
- You are facing increased competition in your core sectors
- Your sales people aren’t able to talk confidently about your customers’ long-term aims.
- Customers are disinterested in your new product or service, or are unwilling to pay for new features
- You are being forced to discount and your sales people tell you that your product is viewed as a commodity
- You are losing key accounts
New product failures are endemic within the B2B environment. Studies of large B2B organisations have shown them to be in the region of 70%. If these are innovative products from respected businesses, what is the cause? It would be simplistic to assign a single cause to all product launch failures as there are many contributing factors. However, it is safe to say that the failure to build the input of executive customers into your new offerings means that, no matter how innovative they are, there is a very real danger that their innovation will not be relevant to your marketplace and your customers.
B2B executives are extremely knowledgeable on the needs of their business. This makes them highly adept and evaluating your solutions in respect of those needs. No amount of crafty marketing, or sales expertise will alter the fact that a product doesn’t solve their problems. The same can be said for new functionality, new services, iterative improvements – the whole gamut. In every sector, your executive customer knows more than you do. Fact!
This only leaves one conclusion. You must align yourselves with your B2B executive customers at every stage of your journey together. Stop paying lip-service to ‘partnership’ and start doing it. Executive customers are interested in buying business value. Who better to tell you what is valuable to their business, than the executives themselves.
And how to achieve these insights. Treat each of your key accounts as a market of one. Develop strategies to engage with executives across the business. Be open about your intentions. Discuss and agree outcomes and next actions. Spend time with your customers, for your customers – don’t try and sell them anything! A sustained campaign can transform your relationship with a client and ensure that you are as educated about the needs of their business as they are. From a sales perspective, there can be no more powerful opportunity.
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