The hardest problem for a new sales person? Understanding the value proposition. If it is broad or fuzzy (all too common), the salesperson must invent the logic for something more compelling. Why do we see this problem so often?

 

Inventing a B2B value proposition is hard work.

A value proposition starts with compelling customer benefits . This means understanding the customer’s value chain as well as he/she does. If our software streamlines customer service, we have several potential benefits. Reduced costs, improved customer satisfaction, improved employee productivity, and new servicing options. To translate these, we need to work with current customers.

–          Are costs reduced because we resolve problems faster? Why?

–          Can we relate improved customer satisfaction to stronger customer retention? Upsell opportunities? How?

–          Does improved productivity enable different work flow? Why?

 

Answering these questions is critical. But it takes time and hard work. For complex products, weeks of dedicated effort, with access to customer decision-makers and staff. And we can’t assign the work to junior staff. They probably won’t be able to go deep enough by themselves. Plus we need to interact with customer executives.

 

A good value proposition is invaluable.

Is all of this work worth it? Absolutely! Benefits stated in customer language and numbers translate directly to collateral and a lot more. We can arm sales people with exactly the right questions—tailored to each stakeholder. Plus a business case template, standard proposal formats, etc.

 

Some amplification on the stakeholder idea. The value proposition addresses each of them. Most complex sales require buy-in from:

–          The affected operational unit (customer service in the example above)

–          Finance

–          IT

–          Other impacted executives (marketing and sales if we have customer benefits as above)

 

Efficient sales prospecting

So where is the magic? In the leverage that flows from a clear value proposition. Marketing and sales messages that reinforce each other. Clear understanding internally about how to deliver value. One of the secrets is a more efficient sales process. A good prospect gets excited because we can help with a “front burner” problem. This prospect will pull us into the solution. What more magic could we want?

 

For some related ideas, check out Seth Godin , Brian Carroll , and Marketing Profs

 

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Awareness. Eyeballs. Market penetration.

What do these terms mean for a B2B marketer? My view: a narrow target set of customers (segment or niche) where we need to increase our profile. For example, financial services CIO prospects for our newest software. Or telco operations executives targeted for an outsourcing service. In these cases, we have to work very hard to get any attention! 

 

Executive Prospecting.

Since executives are busier than ever, our message must be sharp and clear. "Improve uptime by 2%, end user productivity by 5% and save 15%" is a good start. But our busy financial services CIO sees similar claims all the time. We can do better.

 

Let's add some color and sharper benefits. "Did you know that XX firm improved uptime of their critical customer service desk, with customer satisfaction scores up to 4.5 from 4.1 (5 point scale)? Their investment of $300K was repaid in 7 months from increased sales." If we know that customer retention and the customer service desk are important to our CIO target, this approach will be much more powerful.

 

Business Customer Retention and Growth.

For existing customers, we can reach the executives, but how to maximize the impact? The answer: develop their company's specific benefits, then communicate them.  In most cases, this can be done with our day-to-day contacts. However, more than once, I've found a limited perspective blocking the bigger picture. For example, our finance contact may not appreciate (or understand) the operations benefits.

 

Fortunately, we can make some key assumptions and find ways to test them. Now we have a bottom-line benefits story to use with executives in customer newsletters, report cards, and sales calls.

 

 

Plus, we have the compelling benefits to create our story for prospects!

 

2007 is off to a roaring start: some people have already forgotten the holidays! Of course, our 2007 objectives are front and center. But I wonder, do we have the right targets—and metrics? Let's use new product (service) development as an example.

 

New Product Development Metrics

Do you have targets like: launch 1 new product and 2 enhancements in 1Q, 2 in 2Q, etc.? I can't count how many times I've had those targets (the objective usually says "launch new widget X and enhancements to Widgets A, B and C in 1Q," etc.). What's wrong with this picture?

Start with the basics: how did we do last year? How many new products were launched? What % were successful 6 months after launch? 12 months? 3 years? How many launched on time? on budget?

 

If we have this information, we can find better, more strategic metrics.

 

Product Roadmap--not

Product roadmaps-- timeline pictures showing products and features scheduled to launch each month--are great communications tools. They inform the sales force and customers what to expect and when. Those involved in product launches can use the roadmap as a planning tool.

 

But senior management needs more. The roadmap is a result, a tactic. It is not a strategy. If we know we launched 5 new services last year with 3 on time, 2 on budget and 4 meeting initial 6-month targets, we can do better. We want all 7 of the new services targeted for 2007 to launch on time and on budget, then meet their 6 and 12 month targets. But is this realistic, given our track record? Probably not.

 

Strategic Product Launch Objectives 

The solution? Start with strategic priorities: e.g. launch 70% of new products on time, on budget and meeting 6 month financial goals, with the remaining 30% no more than 15% over budget, 2 months late and/or 25% off financial targets. Is this realistic? Probably--if we give these goals to our team as they are creating the roadmap.

 

Of course, there are other strategic factors, like cycle time (product development from official start to launch), % of revenue from new products, etc. But those can wait if all we have is a product roadmap!

As 2007 swings into high gear, I like to remember those holiday moments when I reconnected with an old friend. You know: haven't heard from them for 2 years and a card or email shows up. Even better, I run into them at a party and the conversation picks up like it was yesterday.

 

Why aren't more B2B customers old friends?

How many of your B2B customers are "old friends"? They've been around for years. But when do we think about them? Have a conversation? I don't mean day-to-day transactional stuff. We know about that. And they show up on our revenue and billing reports. I'm thinking about the relationship: have we cultivated it to "friend" status?

 

Marketing role in B2B customer relationships

Business customer relationships are more complex than personal ones. So the first step: a clear, complete, and up-to-date roadmap of all the players. Sales people may call it a positioning matrix. Each of the customer's individuals, their role, and our person(s) assigned to work with them. Add contact information and we have the beginning of a roadmap. Marketing overlays targeted email campaigns, newsletters, webinars, events, product launches, executive meetings, etc. Where does the "friend" part come in? 

 

If we tailor our messages to accurately reflect how the two companies perceive each other and how we actually work together, we can build (over time) a sense of mutual respect--making for a more and more "friendly" relationship. Sales has a role, but I believe marketing also has a leadership role. For example, messages cannot be "one size fits all".

–       If customer B has been with us for 2 years steadily expanding their purchases, we want to reinforce the value and applications for their purchases and promote (in a low key way) future possibilities.

–       Customer C, who made their first purchase 3 months ago needs lots of reinforcement about why they made a good purchase decision.

–       Customer A, who has been with us for 5 years requires a third set of messages.

 

I believe it is marketing's role to identify and execute against these customer "segments". After all, who doesn't like to count their customers as friends?