Why they think they are smarter than you
By Ray Glier
B2B is not what it used to be. A lot has changed, not in 20 years, not in 10 years, but in the last two or three years. The buyer has become an investigator of your offering with the help of the internet and social media. The buyer has pored over your marketing material and put you, the vendor, on the defensive.
And now the buyer has more sophisticated procurement software—Artificial Intelligence—dissecting you on price and performance.
Wesley J. Johnston, Ph.D., professor at Georgia State University and the director of the Center for Business and Industrial Marketing, says the B2B buying journey is 50-52% complete when human interaction occurs. Another study—Forrester’s “B2B Buyer Journey Map”—shows that as much as 74% of the buyer’s journey is done by the time things get down to brass tacks.
Then there is Sarah Scudder, president of Real Sourcing Network, who says the B2B journey is not 50% complete, or 74% complete, when the buyer gets down to making a deal. “That number, 74%, is underestimated.”
In fact, there is virtually no sales floor, Scudder says. Sales has been swallowed by marketing, and more marketing, and procurement software. “The world of buying and purchasing has completely changed and will continue to evolve. Organizations need to become marketing companies and provide relevant information as a way to sell, instead of the traditional sales role position where you have people cold-calling and emailing and contacting companies. The company buyers and decision-makers want to do their own research and reach out when they’re ready.”
So what does that leave for human interaction? Negotiation?
Not even that scrap, Scudder says. “The rise of artificial intelligence is completely changing the way that companies will even negotiate and kind of eliminate negotiation.”
RSN is a software company that provides an e-sourcing tool that automates a five-bid process on each print job. What that leaves, Scudder says, is buyers and suppliers working collaboratively on custom solutions that “solve needs, add value, and fall within budget.”
“The traditional printing company is not going to be around in 10 years,” Scudder says. “Companies that don’t innovate and provide unique solutions will be out of business. So, print companies need to figure out what their niche and expertise is, and what’s going to make them unique in the marketplace.”
For now, not every buyer is going to rely exclusively on artificial intelligence to cap deals.
“Print companies need to figure out what their niche and expertise is, and what’s going to make them unique in the marketplace.” — Sarah Scudder, President, Real Sourcing Network
One of the challenges to vendors presented by proactive buyers who do their own research is getting inside the buyer’s “friends and family circle.” Johnston says many companies are devoting energy to long-term customer relationship building to get inside the family. It has become increasingly important to find the trusted advisor inside because the buying cycle is so short for the vendor (longer for the buyer).
Marketing initiatives to set you up as a “problem solver” in the industry can be a way inside the “friends and family circle” where the better deals can be had, Johnston says.
Beyond the C-Suite
One other aspect of the new B2B buyer is that procurement is happening outside the C-level of the company, in many cases. While major decisions, like building an addition to the plant are carried out at the C-level, department heads and managers are making more of the day-to-day buys like print.
Johnston says vendors need to sharpen their skills at constructing buyer personas. LinkedIn and other social media tools can be a good resource for the print shop as it tries to hunt the decision-maker and influence them early in the game. “Scrape the internet, use those social media tools. Did the buyer give to the American Cancer Society? Use those things to build a profile of the approved buyer.”
The buyer is well-informed these days and thinks they can use that in negotiation. Johnston says it is important that vendors don’t let price be the bottom line. Get value in front of the buyer who thinks they know everything about the value of your product.
“The sales force may need to turn to something like the challenger approach—telling the customer about why his overall solution costs more,” Johnston says. “It offers more, connects deeply with the client’s target community, saves money in the long run and, from a total cost of ownership perspective, may be cheaper.”
Keep the pressure up
Maybe the competitor’s price is the lowest, but in the long run it is not the best deal. A more robust approach would have the salesperson asking the customer questions about whether the competitor included this or that (storefronts, ad specialty items, signage, training, etc.) in their proposal. If not, the value and depth of commitment would be much lower.
The buyer who has an armful of research can put a print shop on the defensive. Get off your heels, Johnston says.
The print salesperson can talk all day about why their solutions are better suited than the competition. In addition, they can reference the potential risks of purchasing a less expensive program with little response mechanisms and less connectivity. Johnston believes that for a few dollars you are risking a deeper problem. How will that affect your profits, job security, etc.?
Here is the issue: Companies have made it tough on themselves because they provide so much solid information about themselves. This is marketing, right? It is, but the salesperson now has a different job because of all that marketing. Their job is not to make the sales pitch; it is to confirm information the buyer has found, but also push back.
Get accustomed to it—the customer is much more active in the sales cycle these days. The good old days—two, three years ago—of cold-calling are gone.
For the print shop that is doing business matched up against sophisticated procurement software and research-able buyers, their marketing and sales teams better be finely coordinated. Indeed, these are no longer separate silos in a company; they are one.
Scudder says her growth and strategy is all run through a marketing eye. She has no sales team.
The strategy is to have some influence in the first part of the buyer’s journey—marketing—and one of the ways to do that, Scudder says, is to not just show up at networking events, but to host them yourself.
For example, RSN is hosting six events for a national Women in Procurement group. RSN also has quarterly webinars and it is hosting five procurement events in 2020, four in the U.S. and one in Toronto. RSN also has a magazine. Scudder is a frequent speaker, too.
The old saying about not waiting for the wave but going out to meet it applies to shops going out to meet the buyer. Do not allow the buyer to do 75% of the work without you—the vendor—being able to make your case.
“Marketing is the new sales,” Scudder says.
Marketing has risen in the hierarchy of business strategies, but sales is still important. “The best company uses a CRM (customer relationship management) system to provide a seamless coordination of marketing and sales with customers,” Johnston says. “The best coordinated marketing and sales efforts also use other kinds of databases such as social media, sales intelligence and competitor analysis.”
The bottom line? If the buyer is traveling 52-74% of the buyer journey without you, make sure you lay the track to your door with keen, sophisticated marketing/sales.