B2B Business people buy for five specific reasons. Keep in mind that this isn’t the process (buyer’s journey); these are the reasons that B2B companies buy.
In order to sell in the B2B market, you need to understand these five factors, and know how to present your products so that they demonstrate how they fit into one or more of these factors. The first four reasons are corporate factors. It is also imperative that you pay close attention to the Personal Wins factor, and demonstrate as often as possible, how you can make your client a winner.
The five reasons are;
• Improved Performance
• Increased Opportunities
• Competitive Advantage
• Risk Mitigation
• Personal Wins
Improved performance can come in three main categories. These categories are.
• An increase in revenue and/or profits;
• A decrease in expenses or costs;
• An improvement in productivity.
As an example, suppose your products can save a client $100,000 in costs. If you’re an accounting company, the savings might be in the taxes you can save your client. If you’re an IT products company, perhaps you save the company from hiring two people, or you make that department more productive. The savings, of course, all depend on the size of the company.
Let’s suppose your revenues for implementing your product are $50,000. That is, it will cost the client $50,000 to buy and implement your solution. These costs would include your actual revenues, as well as the other costs of the product, such as travel, phone calls, etc.
So, what you have done is increased your client profits by $50,000, just on this one project. And if it is an annually renewing cost, you save them the $100,000 in each of the subsequent years. Totally, you have given them a $450,000 savings in five years.
This is the way you need to show your client how you are adding value to their business. Don’t quote them costs, quote their savings. If they haven’t figured out what their savings are for doing the project, work with them on it, and you will keep getting more assignments, and grow your way up the relationship ladder.
If your products help a company generate more revenue and/or profit, it should be pretty easy for you to come up with a very powerful Unique Value Proposition – UVP.
Does your company help your customers increase their opportunities in their marketplace? You may be asking what I mean by this. Let’s delve into this factor a little deeper.
There are four distinct areas where you can help your customers increase their opportunities. These include.
o New Products
o New Markets
o New Business
If you sell a product, you, or the people in your company, may be experts at helping your customers expand into one of these areas. This is very true in the construction industry, where there may be one general contractor who does all of the project management of a new project, and your company supplies architects, or engineers, etc.
Your products may also play a part in helping your clients expand and grow. Perhaps you work with a software supplier that helps a company grow. This software can help your clients expand more easily into different markets, by giving them the types of controls and reports that will allow a company to track their success in that market.
It is up to you and your company to deliver the most powerful UVP you can, while always keeping in mind, what the benefits are for your clients.
This factor may seem a bit similar to the previous one, but it is one that your company should also be preaching. If you can help your clients attain a competitive advantage over their competition, imagine what an impact that will have on you selling your solution to them.
Understanding, how your solution has a competitive advantage, will help you show your clients how your solution can give them a competitive advantage. This is a very powerful way to help you form your UVP.
You can give your customer a competitive advantage by successfully demonstrating one or more of the following factors to them.
o Lower Cost
o Niche Markets
A good example of a lower cost could be this. If you sell a manufacturing solution, either a product or particularly software, that makes your customer more efficient in the way they manufacture their products, this clearly gives them a huge advantage over their competitors.
I am sure you can see that this should be a big part of your UVP also.
Mitigating risk is the most difficult of the five factors. There are two separate ways you can look at this topic.
First, you need to know that whatever you are presenting, it carries some risk for your client. There is the risk that they will have to spend a lot of time working late, implementing your solution. Or they may have to spend a lot of money that will not give them a ROI for a few months or even years. This risk you need to recognize, as it will happen, and you must find a way to mitigate the risk for your client.
The other way risk mitigation affects your client is good for you. It gets into some areas that lawyers and accountants can do almost all of the time. But there are also ways that IT companies can do it too. This is the type of risk that may run your clients afoul of the law, or a computer bug that may destroy their systems.
If you sell any type of ERP software, then there are probably some modules that will help mitigate risk. These modules may be in the financial area, to ensure that your client’s financial statements are accurate, and that they pay their taxes on time.
But it may also get into HR, where the rules for laying people off, or firing people can put companies at risk, if the situation is not handled properly, and the person being laid off or fired isn’t given the right package and directed properly.
The best way to figure out if you have a way to mitigate risk, with your product or service, is to talk to your clients, and simply ask them if your products or services helped them mitigate risk in any way, and how much money they avoided paying by using your product or service. You should ask this for both types of risk mitigation.
Now they may not give you the exact amount, but I am sure they can give you a pretty good estimate of what your product or service did for them. Perhaps they will give it to you in percentage terms.
However, if you can show your clients how you can help them mitigate any risk they may be exposed to, no matter what the economic times, you have an excellent chance of them finding the money for your product or service.
Personal Wins – The Most Important Factor
The most important factor you must consider, when selling your solution to your prospects and clients, is how they have personal wins. In fact, if you can show only this factor, you have an excellent chance of winning the business. This factor needs to be included with the other factors, particularly if you want to move up the relationship ladder. The accompanying chart will explain more vividly how this is accomplished.
Let’s have a look at all of the quadrants, and see the results associated with each one. We will start at the bottom right quadrant, and move clockwise to the top right.
I Win You Lose: This says you are trying to beat the buyer in some way, and in the long run, you will lose the life-time value of that potential client.
I Lose You Lose: This doesn’t have to be talked about, because it says it all. This happens when you get into an argument with your prospect or client, and get a short term gain for a long term loss. Stay away from these situations at all costs. There are some client’s you do not want to do business with, for whatever reason. Don’t do business with them and just walk away.
I Lose You Win: There is one situation where you may want this to happen, and that is to get the client in the door. You may, and actually should, offer all kinds of incentives and guarantees to initially obtain a client. This should only be done when you consider the life-time value of the client, and you want to show that client your knowledge and expertise.
I Win You Win:This, of course, is the relationship you want to build with all of your clients. Win-Win relationships form the basis for any solid experience with another person. This is obviously true whether it is a business or a personal relationship. And as you know, if you have been in business for any length of time, many business relationships turn into very meaningful personal relationships that last a lifetime.
There two other facets of Wins that I want to reveal here. First, I want to show you the difference between Wins & Results, and then I will list a number of Wins that will help you understand the difference.
Distinction Between Wins & Results
As you can see, there is a world of difference between personal wins and corporate results. You must balance the two of these, in order to close most B2B sales.
Let’s look at some examples of personal wins in the corporate setting.
Examples of Wins
• Remain in power
• Achieve control over others
• Get more power
• Get more leisure
• Increase self-esteem
• Be more flexible
• Increase feature development
• Increase personal productivity
• Be an instrument of change
• Be seen as a leader
• Be seen as a problem solver
• Offer uniqueness
• Contribute to the organization
• Increase responsibility & authority
• Gain recognition
• Pursue a certain lifestyle
• Improve social status
• Get more freedom
There are, of course, an infinite number of wins, and each one depends on the person, and the job they are in. Wins also depend upon the personality of the person, their ambitions and goals, and what they hold as important to their growth and to their life.
Get to know the most important people in your client organization. Get to know the financial influencers and the head of the user departments. You can usually guess as to the type of person they are after meeting them once or twice. A good indicator is the type of job they have, and how far they have progressed in that job, or in the organization. But, this is only a general rule, and obviously isn’t true for everybody. However, it gives you a starting point.
Summary of Win Results
- Any product or service that provides the tools and knowledge needed to improve a process. The process, in turn, produces the results through which a person wins.
- Your buyer wins when his or her self-interest is served. That is why Wins are important, and why you need to understand how your buyer Wins in order to sell to him or her.
- People buy because they perceive a relationship between your solution and their individual self-interest. The art and craft of selling is in demonstrating the connection between your solution and the buyer’s self-interest.
- It is often difficult to ask someone how he or she Wins. Therefore, focus first (but not only) on the person’s Results. Then ask how the person will Win with those Results. Coaching will help you understand how people Win.
- The ideal buying situation is of course a Win/Win scenario. Serving your client’s self-interest is ultimately the best way to serve your own self-interest.
This is by far the most important of the above five reasons why people buy. You must understand the person you are selling to, to ensure you know what the reasons are they will buy, and more importantly, why they won’t buy now or possibly ever.
Read more: Should B2B Companies Blog More or Less?