New account acquisition for complex big-ticket products/services is the most strenuous challenge available for marketing and sales teams. Unfortunately, many are disappointed with the results that they generate Developing a keen awareness of a few critical environmental differences between B2C and big ticket B2B is essential. Marketing and sales teams need to understand that they need to close two "sales" for every order and they must learn to do this in an environment that is very different versus the B2C world.
Before we can even begin to sell the prospect our solution, we must help persuade the prospect to be willing to seriously consider change. If we examine the universe of potential buyers for any product or service, the vast majority is not planning to buy anything today. A small percentage is actively considering a purchase of a solution to a problem that you can solve. A larger percentage will sometimes often be willing to entertain a discussion.
Inexperienced marketers and sales people assume that identifying people that are "in the market" is highly desirable. While this is true in B2C markets, it is not true in big ticket B2B. In fact, as will be discussed subsequently, your chances of closing one of these "in the market" opportunities is 10% or less. The sales reps pursuing these opportunities are headed for "Column B".
Our targets are people that are not "in the market" but who should be. Our challenge is to not only move them into actively considering a purchase but to make sure that they buy from us. Consequently, when we are contemplating a lead generation effort, we can assume that the prospects we need to reach will be in one of three states:
Stage 0 = Status Quo
Prospects in this state are not planning to make a change involving the product/service that you offer. They may not necessarily be happy with the present state. Sometimes may not even be aware that alternatives to present business pains may exist.
Stage 1 = Questioning
Before a prospect makes a decision to change, they must advance to a state in which they begin to question the relative merit of their status quo position. For big ticket products/services it is important to motivate senior decision makers to ask the right questions.
Stage 2 = Committed to Change
A prospect becomes committed to change when they learn enough during the "questioning" phase to persuade them that they have a high probability of achieving a satisfactory return on the time and effort invested in deciding what they will change to. Because reaching a decision to buy a specific product or service involves allocating resources to ask the questions and perform the necessary due diligence, this decision must be made by a senior executive. In many instances, their most valuable people will be involved and they will be reluctant to squander these resources.
Marketers who successfully move a prospect from a state in which they are satisfied with the status quo to a state in which they are committed to make a change, have generated demand for the type of product/service that they offer. When you accomplish this, you have closed the "First Sale." Often, an effective marketing effort can accomplish this with minimal involvement of sales professionals. The next phase cannot be accomplished without extensive sales force engagement.
Once a prospect starts to seriously evaluate change, they must first determine what their preferred solution looks like. They must determine what value they must add to the value that they can obtain from a vendor(s) in order to achieve their objective. Final vendor selection decisions will be made based upon considering the cost and risks associated with each possible scenario. In general, people will prefer the path of least resistance and will opt for the lowest cost/risk alternative that allows them to achieve their objectives while minimizing the added value that they must deliver. When a "prospect" reaches this point, they buy. In order to persuade the prospect that we have the best solution, we must help the prospect develop a definition of their ideal solution that is better suited to us than to competitors. For complex big ticket value propositions, this can only be done by skilled sales teams, including technical specialists.
The challenge for the buyer and the seller is that the "solution" definition and the associated implications for Customer added value as well as the value provided by Vendor(s) can become complex. Our experience is that prospects will ultimately buy from the vendor that played a pivotal role in helping them define the "solution".
Within this context, consider that research (Sirius Decisions and others) seems to indicate that sales teams believe that about 80% of the leads that they receive are not sales ready and are not pursued. Of the 20% that are pursued, 70% are eventually disqualified. Most of these eventually buy, usually from a competitor.
Coming Next: What to Do About It