The content was originally published in Forbes on Dec, 10 2019.
The 2008 global financial crisis compelled many businesses to rethink their sales strategies in order to survive. Up to that point, many businesses used to have a purely reactive strategy, and most of them did not know how to adapt to a new market situation in which survival depended on a proactive sales strategy. Such was the case of many business to business (B2B) companies, which had no experience in this kind of strategy whatsoever.
In fact, there is a great need for a conceptual framework to help business leaders who sell to other companies: a model that considers the idiosyncrasies of B2B relationships and helps leaders redesign their organizations to generate better and more predictable business.
Any business transformation must come from the top down. This is why I decided to start training owners and CEOs who wanted to grow in a predictable and organized way. I came to realize that virtually no business school had stopped to think about the peculiarities of B2B companies, despite the considerable number of businesses that offer products or services to other companies (54% of businesses in Spain alone, as reported by Adigital, and even higher percentages can be found in other countries).
Even today, most MBAs and other management education programs show a clear focus on business to consumer (B2C), ignoring the quite significant distinction between selling products to consumers (B2C) and selling products or services to a manager on behalf of a company (B2B). If we analyze the 20 most popular case studies in business schools, according to The Case Centre, 90% relate to B2C companies, while only 10% focus on B2B companies.
In most academic programs, when we talk about marketing and sales, we are referring to consumer products. We often underestimate the importance of the sales function in the growth of B2B companies, and the particularities experienced by these organizations.
It is essential to provide B2B companies with a dedicated conceptual framework and to train owners, general managers, and sales and marketing directors in sales operations aimed at someone other than the final consumer. This conceptual framework must provide a model that includes both tactical and strategic tools that allow B2B companies improve the predictability of their business.
If we want to stop chasing the ball and start getting results linked to the strategy of the general manager – rather than the efforts of a brilliant sales team working on their own – there are five key principles that the leader of any B2B company must understand in order to sell more and better, with less effort and greater predictability:
#1. We are in the people business. For the manager who has to buy from another company, more than 50% of the decision comes from the trust that the people from the selling company are able to generate. B2B talent is a critical part of what a company is selling; consequently, the client buys the culture of the B2B company.
#2. The B2B sale is a process, moving away from art and approaching discipline. It considers the effort of the seller and the awareness of the buyer concerning a specific problem or need. A good sales strategy helps to obtain better results and greater predictability. This approach allows us to determine where we need to improve the process in order to obtain better results. Taking shortcuts never works!
#3. Sales management as a science, based on data. Having the necessary data allows teams to have greater potential to scale up and manage the improvement of business with greater predictability.
#4. B2B marketing is vital. In general, professionals are educated in B2C marketing and remain unaware of the peculiarities of B2B. Managers who buy from us are taking a risk by trusting us and may not believe in us at first. B2B marketing provides the knowledge and tools we need to prove to our clients that we can provide the promised value. Inbound B2B marketing strategies seek to capture leads to feed the sales pipeline and show potential customers that we fully understand their context and can solve their problems.
#5. We do not sell products but solve problems: we sell contextual value. The fundamental asset of B2B sales, which allows us to offer value, is our understanding of the client’s context. Clients do not care about our product or its features; they may only buy this sort of thing a couple times in their entire professional life. What clients want is for us to fall in love with their problems and offer solutions after having fully understood them. Only by understanding the client’s specific situation can we offer context-specific value. This is to stress the importance of having early information about our clients, often as the result of asking the right questions to understand their pains.
None of these principles can be applied without the full understanding and involvement of the general manager of the B2B company. Never delegate revenue generation to the sales team: sales should always be a fundamental part of the managerial mindset of a B2B company. Sellers have to sell, sales managers make sellers, and CEOs have to generate the conditions for better and more predictable revenue.
Some managers may try to take shortcuts by applying one of the five key principles as an isolated action, expecting it to have an impact. However, predictable revenue only happens with a holistic strategy. This means redesigning the organization to achieve the results we are aiming for, not the results we end up getting.
In sum, what companies buy from other companies is not their products, but their solutions – not their brand, but the company behind it. Businesses buy from other businesses, but they do so because they trust people who are able convey the culture of their company.