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Value Delivers B2B Profits
B2B marketing is never easy
because you’re usually dealing with somebody that has costs very much in
mind. However, even more important than getting something at the right
price is making a purchase that delivers real business value.
Value isn’t just about price,
although the cost of an item is certainly a consideration. But when a
company makes a purchase it’s because one way or another they intend to
use it in the conduct of their own business activities. Their purchase
is an expense along the road to making profits.
Business purchasers want real
value in what they buy. They have their own ideas of what constitutes
value and if you can deliver it to them you’ll stay on their list of
preferred suppliers. This means first and foremost, finding out exactly
what they want from you so that you can provide it.
In their book ‘B2B without the BS, The Business-to-Business Sales and
Marketing Manual’, Robert Bell and Louis Zacharilla tell us, “Price has
meaning only in relation to value. If customers balk at our price, it is
because the value we deliver does not justify the price for that
particular set of customers.
“We may think we are selling a premium-quality service or product, but
the potential buyer may see it as a commodity which makes our
premium-quality price look outrageous. But a potential customer who
shares our view of the premium quality will find the price reasonable.”
Too many businesses approach their marketing with the idea that they
have a product and now they need to sell it. Instead, their focus should
be on identifying the customer’s needs and meeting them; start with the
customer and work back to what they’re trying to sell.
From the customer’s perspective being offered a product that only
marginally meets their needs or worse, that they don’t need at all, is a
supplier’s admission of failure. When a supplier takes the trouble to
find out exactly what a business needs and then brings it to them they
demonstrate superiority over their run-of-the-mill competitors.
Take for instance the tendency of many large corporations to enhance
their existing products with ever-increasing layers of technology. The
field of consumer electronics is a standout in this area; consumers are
faced with a number of similar products that offer features that most of
them will never need or use.
Is this going to be perceived as providing real value by the consumer?
The manufacturer may think they’ve added value to their product with
extra features but if the consumer doesn’t want or understand them
they’ll default to a more familiar offering.
This is why the application of R&D funds should be made only after a
real need or demand in the marketplace has been identified. Too often
what are called ‘solutions’ don’t actually solve a real problem and
therefore end up being discounted to move them off the supplier’s
shelves.
Product R&D should begin with market research. A company can only make
profits from products that are in demand, and should never make the
mistake of believing that a product can create its own market because
it’s so unique or clever. Such miracles do happen from time to time, but
more often than not R&D for its own sake is a waste of resources.
Discovering a genuine need
creates the opportunity for exceptionally effective marketing activities.
Relevance is one of the most powerful attributes a product can have and
prospective purchasers can actually be grateful for a supplier’s taking
the trouble to come up with something they really need and that makes a
contribution to their profits.
This also defines new goals for customer service teams seeking to
optimize customer satisfaction levels. They should see themselves as
helping their customers acquire the maximum value from the products
they’ve purchased and can structure their activities to accomplish this
goal.
Another critical aspect of post-purchase service is making sure that the
customer is aware of the value obtained from their acquisition. For
example, the purchasing department may not have any idea of just how
well the ingredients they’ve purchased are actually performing during
the manufacturing process. The two areas can be ‘brought together’ by
the supplier who is naturally going to benefit from this activity.
As Texas-based CourseJunction.com, providers of B2B educational seminars
say on their website: “Although many B2B companies have an excellent
reputation for quality products, expectations of customers are
continuously evolving. While engineering and manufacturing expertise is
essential, it is the customers’ perceptions of superior value that
ultimately lead to success in business markets.”
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