What Einstein Exposed About B2B Marketing and Sales

Einstein b2b sales and marketing

“If you can’t explain it simply, you don’t understand it well enough.” — Albert Einstein

As I ponder that quote, I wonder how many marketing messages and sales conversations lack simple explanation. I bet it’s more than I can guess (and right now I’m guessing a number ending in lots of zeroes). And without that simple explanation, prospects quickly become disinterested.

I don’t think the reason for prospects’ lack of understanding is that marketers and salespeople are stupid. I believe it’s because they don’t understand how customers use their offering and realize value. Here is an example from a blog post I wrote last year. Nuance, one of my clients and a leading document management software provider, was focusing its messaging on savings from reduced paper and ink consumption. However, we soon discovered that labor savings (as a result of employees dealing with fewer paper documents) was an even bigger value driver. Knowing this, we could then roll out the positioning and tools that resonated with prospects.

In another project that I’m currently working on with a provider of managed services, the client’s roughly translated messaging is that “you can save time and money” — with no real explanation behind it. And this despite the fact that their solution can deliver millions of dollars of cost savings and incremental revenue. We’re now working with them to identify their discrete benefits that buyers will care about.

Benefit-Identification Framework

You can improve your understanding of how prospects view your solution by thinking about your offering in two distinct ways:

  • Cost Savings: How does my offering help customers save money?
  • Revenue Gains: How does my offering help customers grow revenue?

There is a third special case but we will get to that in a moment.

Cost Savings

This is not, “I’ll cut my price by 2% and save you $20,000.” No, no, no! What you want to do is to think how your solution lowers your customer’s expenses. Common areas to look at are COGS/Cost of Sales and SG&A expenses.

For example, does your offering:

  • Improve throughput?
  • Reduce headcount (or avoid hiring additional workers)?
  • Eliminate legacy systems?
  • Lower direct material consumption?
  • Reduce scrap rates?

Revenue Gains

Again, from your customer’s perspective, how does your offering improve their top line? Top line growth can only happen four ways:

  • Higher customer retention
  • Better customer acquisition
  • Greater wallet share, including cross-sell and upsell
  • Higher selling price

For example, does your offering:

  • Improve customer service?
  • Enable faster market expansion?
  • Reduce online store downtime?
  • Produce a competitive advantage for your customer’s product?
  • Generate more leads?

Total Cost of Ownership – The Special Case

The framework above is useful for showing prospects the need to change. However, when a prospect decides to move away from the status quo, you might find yourself in a competitive selling situation. In this case, you need to show the benefits of your offering vis-à-vis your competitor. Differences in the cost savings and revenue gains that your customer can expect from each solution should be included in the business case, but you also need to dig deeper. For example, relatively speaking does your offering:

  • Need fewer hours to maintain?
  • Require less installation costs?
  • Use fewer consumables?
  • Have a smaller footprint?
  • Consume less energy?

Here’s another way to think about it. Ceteris paribus, wouldn’t you put the brand of motor oil in your car that lasts 20% longer?

Remember what Einstein said?

After you go through the benefit-identification framework to understand what matters to your customer and how much it matters, you can provide prospects with a simple explanation of your offering. I bet that will cut through your prospects’ stupor and get them to act.

What steps do you take to make sure customers understand the value of your offering? Share your thoughts in the comments section. 

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[Image via Flickr / Fahad Khalil]

When Demos Sabotage the Sale

sales demo

Demos are a fundamental part of the sales process. Not only are they a great way to engage prospects, they frequently open the door to a deeper conversation about how you can collaborate to solve the prospect’s most pressing business challenges.

That said, the demo can definitely sabotage sales — particularly for anyone selling complex offerings with long sales cycles. Specifically, the number one mistake I see is showing the demo too early in the buying cycle. Sometimes it’s the sales professional who pushes too soon for a demo. Other times, the prospect asks to see the demo, and the salesperson takes the request as a good sign and leaps at the request. Based on my experience, however, you always want to pace yourself when it comes to the demo. Here are two reasons why.

1) You might not be dealing with a decision maker.

Generally, decision-makers tend to care less about demos and more about how you can solve a business problem. In many cases (particularly in the software world), the person who wants to see the demo is the person who will actually be using your offering. If that’s the case, they’re just curious to see how it works and whether they like it.

2) You become trapped by objections about features or superficial aspects of your offering.

When prospects watch demos, you want them to be in the right frame of mind. Show them a demo too early, and they’re highly likely to focus on the aspects of your offering that they don’t like or perceive as imperfections. This is how you get caught in a web of such silly objections as, “This tool won’t work for us because that button is green and our standard is blue.”

Before you do the demo, you want to be sure you’ve laid the proper groundwork for a collaborative mindset. That means waiting until prospects are 1) aware of their business problem and how much it’s costing them and 2) are committed to solving that business problem. At this stage, they’re much more likely to focus on why your tool is a compelling solution to help them solve their challenges.

One metric I favor looking at is the demo-to-close ratio. The desired value varies quite a bit by industry but you can always measure it against other salespeople in your organization. I’d bet that top performers have lower ratios. Salespeople who throw demos around like candy at a parade are wasting their time and maybe even turning prospects off.

So, when is the right time to show a demo? Obviously it depends a bit on the nature of your solution and the sophistication of the buyer. For complex sales, I generally say that anyone who asks for a demo is likely not a decision maker and should be treated accordingly. The right time to show a demo is when you know you’re talking with someone who is interested in business outcomes rather than the features of your offering. If that’s not the case, use the right questions (for example, “Who will be involved in the decision to move forward with this? Can we set up a meeting with the team?”) to bump the conversation up the decision food chain.

What are your thoughts on the right time to show a prospect your demo? Share your thoughts in the comments section.

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[Image via Flickr / ykanazawa1999]

Reimagine Your Sales Process and Become Visible to Buyers

It’s commonly accepted that the large majority of today’s B2B buying process is completed before vendors are even aware that there is an opportunity. Imagine that! Or better, reimagine what you can do about it.Buying Process Visibility

The challenge facing vendors is how to increase their visibility earlier in the buying process. We all learned the typical sales process in Sales 101. However, that’s what’s hindering success in today’s marketplace. Throw it out!

Think in the terms of your buyers. What’s on their mind? I bet they’re asking questions like these:

Is there a better way?”

“How much is what we’re doing today costing us?”

“How do I justify asking for such a large expenditure?”

Buyers are doing research and answering these questions alone; meanwhile, they are invisible to vendors. With the right approach, though, you can help answer these questions and identify prospective buyers.

Step 1: Help prospects identify their own performance gaps.

The buying cycle begins when prospects start to question their status quo. By making assessment tools available to your target market, you can help buyers identify their performance gaps and, at the same time, position yourself as a resource to help buyers solve their problems. Read how one of my clients, Halogen Software, uses this approach for demand generation and lead capture purposes.

Step 2: Help prospects understand the value of your offering.

The next step in the buying process is for buyers to ask themselves if the problem is worth solving. At this stage, buyers are starting to educate themselves about solutions and the financial impact a given solution can have on their organization. Giving prospects access to a value calculator through your website (or through a targeted campaign) is a great way to help them understand the value of your offering as it relates to their unique circumstances. Not only does this position you as an industry leader but you will receive leads that are often better qualified than those you receive from your other lead-generation activities. Another one of my clients, Nuance, uses a value calculator to raise awareness and capture leads by asking users to calculate their “hidden costs.”

Step 3: Show financial metrics that spur prospects to action.

Once buyers are convinced they have a problem and the problem is worth solving, the next logical question is, “But at what cost?” By now, prospects have narrowed their vendor evaluation to a meaningful few. To stand out, vendors must build upon the approaches advocated above and now show buyers their offering’s net value. An ROI calculator is a great way to illustrate your offering’s net value and move buyers to action. I’d guess two-thirds of my clients use this method: 1) create demand and capture leads via an assessment tool and/or value calculator and 2) close deals using an ROI calculator. Tribute is a representative example of how to use this one-two combination.

Vendors late to the party are often being played without realizing it. They see a lead come in and check the box for step one in their sales process, then check the box for step two, etc. What a waste of time! Vendors with the insurmountable advantage are those that identify buyers early and engage in meaningful exchanges around business value. It might take some imagination to accomplish this but I hope the ideas advocated above get you started.

How do you see your sales process? Is it aligned with established internal procedures created long ago? Or has it evolved to match how today’s buyers educate themselves? Share your thoughts in the comments section.

Value-Based Content Marketing Improves Lead Conversion Rates

the best

Why do B2B marketers invest in producing blog posts, white papers, reports, articles, and videos? The general aim is to attract an audience to their website so they can engage them and (hopefully) turn them into customers over time.

As I wrote last week, I believe that marketers often don’t consider ROI tools and value calculators when planning their content marketing mix, and I think this is a missed opportunity. If marketers want a high volumes of well-qualified leads, then my view is that value calculators and ROI tools can often pack a much bigger punch than other forms of digital content.

I’m not saying that traditional modes of content marketing aren’t important. But I don’t believe blogs, articles, and white papers have the power to deliver well-qualified leads in the same way that a targeted value calculator can. Someone who engages with a value calculator is demonstrating an interest in understanding the problem that you can solve for them and evaluating the economics of your solution to their business. To me, that indicates a serious buyer. Someone who wants to read a white paper might be a serious buyer — on the other hand she might just be looking for general information about that topic.

When you make a value calculator available on your site, you typically want to allow them to use it to evaluate the economics of your offering in an open fashion (not gated). In order to download the business value report generated by the calculator, though, you typically want to capture their contact information before providing the report. Someone who is interested enough in the analysis to provide their contact information to get the report is more likely to be thinking about how your offering will impact his or her business and is a more serious prospect. By definition, this person is probably a better and more qualified lead for you than someone who downloads a white paper or visits your site to read general content.

Of course value calculators are just one piece of an overall content marketing strategy. Blog posts, articles, and white papers, etc. help establish your brand and position you as an authority. (Those assets are also likely to drive more general traffic to your site.) However, I do think ROI tools and value calculators can help companies capture better-qualified leads than other types of content. If you can deliver better qualified leads to sales, then salespeople naturally spend less time chasing leads who have little or no intention of actually making a purchase. The more time salespeople can spend in conversations with serious prospects, the more likely they are to close more deals. Who wouldn’t want that?

What types of content do you include in your marketing mix? Do you use value calculators or ROI tools? Share your thoughts in the comments section.

[Image via Stuart Miles / FreeDigitalPhotos.net]

Is There Value in Your B2B Content Marketing?

Content marketing is a term that gets a lot of buzz these days, but the basic concept of capturing prospects and buyers through stories has been around for generations.

This video put together by Content Marketing World shows a full timeline of the history of content marketing, including examples. According to the video, the term “content marketing” emerged only around 2001, but the concept itself started over a century ago. The earliest example they cite is John Deere’s magazine, The Furrow, launched in 1895. (This magazine is still around, with a circulation of 1.5 million in 40 countries and 12 different languages.) The video also calls out “The Michelin Guides” put forth by tire manufacturer Michelin back in 1900 to help drivers maintain their cars and find good inns and hotels while traveling.

What is the ultimate aim of content marketing? Broadly speaking the goal is to get prospects and buyers to connect with what you have to offer through storytelling and education. The Content Marketing Institute is even more specific in its definition of content marketing:

The technique of creating and distributing relevant and valuable content to attract, acquire and engage a clearly defined target audience in order to drive profitable customer action.”

If the purpose of content marketing is not only to attract prospects but also to turn them into customers, then it only makes sense in a B2B context to focus closely on your value proposition. In other words, B2B marketers need to remember that there’s generally a big difference between the ways B2C marketers approach content in contrast to their B2B counterparts. In a previous post, “Why Branding Doesn’t Work on B2B Customers,” we made clear distinction between the “rational” world of the B2B customer and the “irrational” world of the B2C customer.

“B2C marketing efforts are frequently driven by such irrational factors as image, self-satisfaction, fashion, the need to be cool, sex appeal, etc. That’s why consumer marketing generally lives and dies by advertising. Very few consumer products or services can survive without it. Consumer ads, promotions and other image projections often establish the product’s value and create the demand for it.

The B2B world, by contrast, is rooted in the rational. Branding that appeals to irrational or perceived needs just isn’t going to work, because in the end businesses will not buy nor continue to buy things that don’t actually help their business.”

In other words, the B2B decision-maker looks for economic value when investing in a solution. While a great story might be appealing to B2B prospects, they won’t become customers unless that story can illustrate how you can help them save or make money.

Although many B2B marketers think of content marketing in terms of articles, blog posts, PDFs, white papers, video, and infographics — all great and valid forms of content that can engage prospects and customers — I don’t often hear about assets that can help a prospective customer understand the value that an offering can deliver as part of the discussion. These assets include such things as value calculators and ROI tools and I believe that they’re a critical component of a content marketing strategy if the offering is more than a standard transactional decision and constitutes a significant investment. Considering the interest the B2B buyer has in financial metrics, I think that is a missed opportunity.

What kinds of content marketing do you rely on to attract prospects and turn them into customers? Do you use ROI tools or value calculators as part of your content marketing strategy?  Please share your thoughts in the comments section.

Remove “ity” Words from Your B2B Value Proposition

By Jeff Bennett and Darrin Fleming

value messaging b2b marketing

When building relationships with buyers, it’s important to choose your words carefully. We’re not just referring to small talk or the language of negotiation. We’re talking about the specific words you use to describe your offering and what differentiates it.

A lot of sellers and marketers make the mistake of using what we call “ity” words when attempting to convey the value of their offering. For example:

  • Reliability
  • Quality
  • Durability
  • Flexibility
  • Elasticity
  • Viscosity

We’re not down on these words in general. In fact, depending on who you’re talking to, they can be important descriptors. Although the words above might describe your offering, the problem is that they fail to convey the value of your offering.

For example, let’s say your product increases elasticity by five percent. That’s a fine statement for your messaging. It describes to engineers and technical experts what your product actually does. But it means almost nothing to the people in charge of giving up a budget to purchase your product. Unless you can describe exactly how that five percent increase in elasticity will advance your customer’s business, you’re not going to make the sale based on that statement alone.

The other problem with “ity” words is that they’re relative. Context is everything. For example, some would say that Energizer batteries have a high degree of reliability. But the assumption is that you’ll use that Energizer battery in a toy. If you tried to use it in a space shuttle, would you still be able to say the product is highly reliable?

“Ity” words can also be so vague as to become meaningless. For example, for years, Ford’s slogan was “Quality is Job 1.” But what does that mean? Say you’re in India manufacturing cars, and you call them “high quality” because they last for three years, and that conforms to consumer needs and expectations. If you want to expand to a U.S. market, the claim that you make the “highest quality” cars in India suddenly means something very different, because American consumers have a different expectation about the length of time a car should last.

Similarly, a person buying a Porsche isn’t looking for the same definition of quality as a person buying a four-door sedan. In those cases, quality means different things to different consumers. To translate product features into value, be specific. For example, does quality mean “lasts longer,” “uses the most advanced technologies,” or “requires fewer trips to the service garage”? (For more insight on this topic read “How Does Quality Relate to Value?”.)

Most words that end in “ity” are either so vague or so relative that they fail to usefully convey your value to customers. It’s essential to convey to the customer how your product will impact his or her financial statement. Adjectives might describe your product accurately, but for the purposes of your value proposition, you need to push beyond “ity” words. When you come across these words, ask “why?” several times to understand how this adjective conveys to the customer how your offering will impact his or her business.

Again, we wouldn’t advise removing “ity” words from your messaging, because if you make a material with a high viscosity, that’s something the customer should know. Just remember that you need to be able to push past features and benefits when talking to buyers (and particularly financial buyers) if you want to close the sale.

What adjectives do you use to describe your product when talking to customers? Share your thoughts in the comments section.

[Image: Flickr / Martha Soukup]

Three Tips to Drive Urgency Among B2B Decision Makers

Sometimes the way you talk about a customer’s problem can make all the difference. In our experience, there are lots of ways to encourage prospects to think about their business problems with renewed urgency. The next time you want to light a fire under your prospect, try one of the following conversational approaches.

Tip #1: Highlight the “cost-to-delay.”

The cost-to-delay is how much your prospect is losing per month (or week or year) by not investing in your solution. It’s an easy number to calculate (simply divide the value your solution delivers per year by 12) and can make a huge impact during a sales conversation. The minute you say, “Not doing anything about this problem that our solution solves is costing you $25,000 a month,” the prospect typically starts to think about the situation with new urgency.

value calculator ROI cost to delay

Tip #2: Show the payback period.

Calculating the project’s payback period (the amount of time usually expressed in months before the incoming cash flows from the project exceed the project’s costs) can lower your buyer’s perception of risk. Many buyers often ascribe a shorter payback period with the thought that less can go wrong in the short term. You can use this to your advantage by telling your prospects, for example, “If we start now, you’ll already be ahead three months from now.”

Tip #3: Focus on where you have the biggest impact.

Sometimes you can have more influence with prospects if you focus on only the biggest value drivers in your conversations.

This came to light with one of our clients, Nuance, which offers scanning and printing solutions. One thing we discovered was that the biggest value driver for them is labor savings — using Nuance solutions, companies no longer have to spend as much money on having employees deal with managing paper documents. Nuance was aware that this was one of their value points, but they were weighting this equally with other value points (for example, the savings in paper and print cartridges) in their messaging. By focusing the conversation to pinpoint labor savings (which is a much larger savings in their case), they help prospects understand their solution’s value right away. You can learn more about the Nuance story here.

When deals stall it’s often because the buyer lacks the financial justification for your solution. Using the three tips above can get you back on track to quickly close the deal by proving the buyer with business case necessary to obtain internal budget approval. The next time you face a deal that is seemingly going nowhere try out this approach and let me know your results.

To learn more about how value calculators can increase urgency and drive buyers through the sales cycle faster, visit https://tools.estimatebusinessvalue.com/stratavant/ValueCalculator/Home/Home.