Data gathered by B2B International over the course of 15 years shows clearly that price is rarely the distinguishing factor when it comes to purchasing a business-to-business product. The decision to purchase is more often based on a perception of overall value, and not solely contingent upon a low price. In a competitive market such as China, it is therefore critical for a company to understand the full spectrum of perceived benefits offered and to be able sell on value to such “value buyers”, rather than on lowest price.
B2B International has also observed an increasing sophistication in the needs of “value buyers”. What were previously regarded as “differentiating needs”, such as product quality, consistency and rapid delivery, are now becoming hygiene factors automatically expected for a provider to even be considered. The next generation of differentiating needs arising in their place is often based around brand, business relationship, and consultancy. B2B consumers are now calling for differentiating factors such as innovation, partnership, and thought leadership.
In B2B markets in China, this trend provides sophisticated businesses with a huge opportunity to differentiate themselves through value marketing and value selling. The following three key points, which can be applied to any B2B market, demonstrate how a business can market and sell an offer based around value rather than price.
1. Understand what your customer will pay for
Many B2B companies continue to operate under the misapprehension that product quality and price are the only things that matter. This myth of the price-focused market is a simplistic view and one that is arguably accentuated by B2B salespeople who only know – or want – to sell on price.
It is quite alarming how few B2B companies conduct thorough, systematic research into their customer requirements. Fewer still recognise that their customers’ needs may change over time. It is this, not falling prices, which causes many B2B companies to fail.
Market research into customer needs and a more long-term, marketing- rather than sales-oriented mindset are highly https://www.flomaxbuyonline.com recommended as ways to improve any business’s understanding of its customer requirements. This type of investigation is key to successfully marketing a product on value attributes that matter to the customer other than price.
2. Sell an outcome, not a product
For many years, consumer marketers have acknowledged that the road to higher margins lies in selling “outcomes” rather than simply products and their features: Coca-Cola is a brand that creates happiness; Nike offers self-empowerment and a “can-do” attitude. It is these outcomes, rather than the products that achieve these outcomes, that hold the greatest value for consumers.
Shrewd B2B marketers also seek to answer the question: What are we really selling? and then construct their marketing and sales approaches around these outcomes. While product features can be used to substantiate the outcome that is being sold, they should not form the core of the message.
3. Consider the emotional needs of business buyers
B2B International has observed an emotional requirement developing among business-to-business buyers – the need to “forge a future” with a supplier. Economic cycles are shortening, and job markets are becoming less secure, yet choices for buyers are increasing. At the same time, a sophisticated understanding of cost-in-use and product life cost has emerged among consumers.
As a result, customers increasingly demand suppliers that will help them face the future, be it shaping the next innovation, tackling the next new market, or creating the next business model. Most B2B surveys highlight “innovation” and “partnership” as key needs, and these are usually insufficiently met.
Progressively, therefore, we are seeing a polarisation of B2B markets: The minority of the market – “price buyers” – are more price-focused than ever, yet, at the same time, the majority – “value buyers” – are more discerning. Going forward, it is imperative for any company in a B2B market in China to seek to understand the full value they offer to customers and to market their product or service accordingly.