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The State of Buyer Personas 2012

© All Rights Reserved by 24point0

This June marks ten years since the first buyer persona development methodology was pioneered and launched by the firm Goal Centric now called Buyerology.  Over the past ten years it has been quite a journey.   Much has happened and much has changed.  The adoption of research-based modeling of buyers that leads to buyer personas has been mixed.  The rise in popularity of the term has also been a mixed blessing.  It has resulted in many misguided definitions and practices that have not produced the potential results other organizations have seen when the goal-based modeling methodology is utilized.  The organizations who have embraced the goal-based modeling methodology for research-based buyer personas have seen tremendous success in uncovering new opportunities for revenue growth.

The State of Buyer Personas 2012

Buyer personas today are becoming more widely used by marketing and sales organizations than ten years ago.  Understanding about buyer personas and their place in the grander effort of modeling buyers to inform marketing and sales strategies ranges from harmful misperceptions to evolving maturity levels profoundly transforming organizations.  Today’s business leaders can reach a maturity level that allows for a robust practice of modeling buyers whereby buyer personas are one of the tools used for descriptive and predictive buyer modeling.

The following are some reflective thoughts on the current state of buyer personas:

Buyer Persona Sophistication On The Rise

 Personas first emerged as a tool for design in 1999 when Alan Cooper published The Inmates Are Running The Asylum.  It was in this book that the term buyer persona was first used although to point out that the focus of design should be on user personas as opposed to buyer personas.  I was privileged to be a witness and participant to the development of the goal-based modeling methodology created by a cast of innovative thinkers for design personas focused on users.  This same methodology serves as a foundation for what later became a specific goal-based modeling methodology for marketing and sales personas focused on the buyer.  Today, in 2012, the understanding of this methodology is unevenly understood yet buyer personas are evolving into a more sophisticated modeling tool being used by marketing and sales organizations.

Success Dependent Upon Modeling Methodology

We are seeing organizations attempt researching buyer personas for the first time while others are attempting to take limited success with buyer personas to new maturity levels.  There is a direct correlation between success and the foundational understanding of the goal-based modeling methodology when it comes to buyer personas in general.  Robust understanding of buyer personas as a modeling tool versus a profiling tool helps to ensure that they are effective and do what they are designed to do – inform marketing and sales strategies.  In cases where I have seen poor results, lack of adoption, and inappropriate use, these can usually be traced back to the misunderstanding of buyer personas as a detailed profiling exercise.  Business leaders today will need to be more discerning as the proliferation of the term buyer persona becomes more widely used by consultants and agencies to describe what amounts to as profiling.  Much of the offered templates and practices are buyer profiles masquerading as buyer personas.  Determining whether consultants or agencies are trained and skilled in the goal-based modeling methodology foundational to personas becomes an imperative.

Modeling Takes Center Stage

A development on the rise is organizations today are beginning to make the connection between understanding new and fast-evolving buyer behaviors and the need to understand these behaviors through modeling.  Buyer personas are best defined as the modeling of buyer behaviors, the key attributes of buyers, and most importantly the goals of buyers.  In the past few years, through co-creation efforts with Fortune 100 companies, we began to see robust modeling expanding beyond just the concept of a single buyer persona to that of modeling key dynamics of the overall buyer experience such as buyer ecosystems, buying scenarios, mental models, values, and experience.  Additionally, we are seeing more robust efforts in descriptive, narrative, and predictive buyer modeling that represent a comprehensive view of behaviors associated with individuals as well as with companies.

Research-Based Understanding Gaining Momentum

Personas are developed from primary qualitative research with real customers.  Specifically it calls for the type of qualitative research that is grounded in a robust understanding of goal theory.  Many business leaders are discovering that this may not be as simple as assigning this task to marketing personnel and that outside expertise in goal-based qualitative research and modeling ensures the highest return on such efforts.  Personas are not created, crafted or constructed as in the world of profiling.  Personas represent a distinct set of patterns uncovered in research and represent the illumination of buyer’s behaviors, goals, and experiences that inform.   At this state of buyer personas in 2012, companies are beginning to realize that poorly researched and template-based persona profiling may be proving to do more harm than good.  This important aspect of buyer personas and buyer modeling is beginning to grow solid roots in the minds of many business leaders – particular those who have wasted budgets on poor profiling based efforts imitating as personas.

Addressing Complexity

The significant shifts in buyer behaviors in the past few years have left companies struggling to deal with increasingly new dynamics of complexity.  Particularly those who have large bases of existing customers and have seen the mix of channels used by customers become more diverse as well as integrated.  Organizations are beginning to address newer forms of complexity by improving understanding of buyers by behavioral groups and focusing on the goals of buyers.  At this state, the adoption of this approach has been mixed.  Some organizations have come to misunderstand buyer personas as a tool only for messaging and content marketing.  Thus, the focus can shift to a narrow profiling view intended to help with writing content as opposed to the intended focus on helping business leaders and stakeholders to make informed decisions based on an outside-in view of customers.  Efforts in buyer modeling and buyer personas help companies to cut through the complexity and to prioritize tactical and strategic measures that best connect with customers.  The highest return on the modeling of buyers with the use of buyer personas and other modeling tools is when they help to optimize all facets of the buyer experience as opposed to a limited scope of just messaging.

Buyer Persona Lifespan

The rapid pace of changes occurring in technologies and the impact they have on buyer behaviors means that the lifespan of research-based buyer personas has considerably shortened.  This is causing a shift in thinking about qualitatively researching buyer personas from a periodic one-time event to a view of ongoing buyer research whereby buyer models are continuously updated.  This is one of the most profound changes occurring in the field of buyer modeling and use of the modeling tool we know as buyer personas.  Companies striving to remain relevant to their customers will need to constantly update their knowledge of evolving channels and buyer preferences and how they relate to buyer goals.  Business leaders will also need to evaluate their own in-house capabilities to conduct appropriate goal-based qualitative research with customers versus use of outside expertise in light of this change.

The Next Frontier: The Rise Of Sales Personas

After ten years, I’ve witnessed the rise of buyer personas as a concept embraced by primarily marketing albeit with mixed results.  What I am witnessing over the past couple of years is what may be counter intuitive to the current notion about buyers being elusive, hidden, invisible, becoming buyer 2.0 or 3.0, and many other similar descriptors.  I do not buy into these views based on results from conducting qualitative research directly with buyers.  Here’s what I am seeing as the next frontier: buyers are seeking more interaction and connection and not necessarily more content to read.  Our definitions and concepts of interaction and connection will undergo transformation due to rapidly changing technologies.  Buyers today see new technologies as a means to enable stronger interaction and connection – not as a means to be elusive or to hide.  However, it ups the game for companies to be even more relevant than they ever had to be in their existence.  Based on ROI and revenue growth impact alone, in the totality of the buyer persona development efforts conducted by Goal Centric/Buyerology, the most impact from an ROI standpoint have been those originating from sales.

This leads me to another belief that may be counter intuitive: poised to enable this stronger form of interaction and connection is sales.  Sales as we know it today will undergo further transformation yet I see its role becoming more prominent in developing the closer connections buyers seek.  Buyer modeling and the modeling tool of buyer personas will be an enabling process for companies to transform their sales organizations into a gateway for buyers to make the interactions and connections they seek.  While marketing personas and the proliferation of the term buyer persona have gravitated towards a specialized focus on messaging and content marketing, I see the rise of sales personas emerging to inform understanding and strategies that result in stronger connections with buyers.  I am excited to be working on specific goal-based modeling methodology that address the role of sales personas utilized towards lead development, lead nurturing, social selling, inside selling growth, account-based marketing and sales, sales effectiveness, and buyer conversation effectiveness.

We’ve come a long way with the concept of modeling buyers and the tool of buyer personas.  Yet, we have a long way to go.  One constant we can count on is that buyer behavior will continue to change just as rapidly as new technologies are evolving.  The use of descriptive and predictive buyer modeling tools such as buyer personas and buyer scenario models will become an important part of helping companies to make informed decisions on their future strategies.

(The State of Buyer Personas 2012 is available in PDF format on the Buyerology eBook page: click here for download)

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Is Your Organization Likeable? Are You Attracting the Right Buyers?

Sally Field

Sally Field (Image via RottenTomatoes.com)

The phrase Laws of Attraction first appeared in the early 20th century around 1906 by William Walter Atkinson as part of the new thought movement and release of his book  Thought Vibration or the Law of Attraction in the Thought World (Chicago, 1906).  Since, this phrase has been used to help explain attraction-based theories and concepts in many areas of the social sciences throughout the 20th century and now into the 21st century.  Most recently, Rhonda Byrne’s The Secret became a worldwide sensation in 2006 which was based on the laws of attraction principles.  One powerful constant has remained throughout the 20th and 21st century – that likes attract likes.

While there is much focus given to demand generation, content marketing, lead generation, lead management, and opportunity pipeline management, recent significant changes in buyer behaviors calls for serious examinations of whether organizations are attracting the right buyers.  Simply stated – is your organization even “likeable” in the eyes of your buyers?  Does your organization have so called “laws of attraction” attributes that buyers are attracted to?

This is a powerful question today.  For some organizations, it may feel like reality dealt a blow to the midsection when they truthfully answer the question.  While others may scream like Sally Field and exclaim “they really like me, they really like me!”  While strides are being made in how to adapt to new strategies for managing leads and performing lead nurturing, many outdated assumptions about how buyers look at and evaluate organizations are still in play.

Are Buyers Really Hiding?

Based upon my qualitative research, I am having a hard time buying into the recent rash of terms to explain buyers today.  In talking with buyers directly, they certainly don’t describe themselves as the hidden buyer, the elusive buyer, the buyer 2.0, the invisible buyer, the secret buyer, and the many more terms that are being used.  Here’s what one buyer recently said to me while interviewing:

“It is silly to hear you say that.  I am not hiding from anything.  If they have nothing to offer and can’t help me, then why am I going to pick up the phone and contact them? “

I don’t think buyers are waiting behind a rock to come out of hiding.  In fact, I am beginning to form an opinion that this mode of thinking may even be detrimental to attracting buyers!  It creates a mentality that you have to coax buyers to come out from hiding or to stop playing dodge ball with you.  In other words – hurt the laws of attraction psyche meant to attract the right buyers in the right situations.  The real issue from my point of view is that recent changes in technology and buyer behaviors are resulting in a manifestation of whether your organization is found to be likeable or not.  New technology and newly formed buyer behaviors make it easier for buyers to say:

“If we like you, you will hear from us.  If not, you won’t hear from us.” 

Becoming Likeable

Finding out how to be likeable and, in effect, make the laws of attraction work for your organization is a complex issue today.  It can be frustrating to get at the kernel of why buyers are attracted to organizations and find them likeable.  It very well could be like asking your teenage daughter why they like something with the usual answer of “I don’t know, I just do, and stop asking me questions!”

Finding the right group of buyers today and determining what makes your organization likeable takes more than an exercise in buyer personas – and especially more than the enhanced buyer profiles with a photo slapped on it and mislabeled a buyer persona.  It takes a deeper commitment to understand qualitatively how to be likeable and attractive to the right group of buyers.    Here’s the premise of why this commitment today is of significant importance:

To become likeable and to attract buyers, you must first change your vision of buyers. 

If your vision of buyers has not changed much in the last few years, then it is highly unlikely that knowing what laws of attraction are in play to make an organization likeable to buyers are well understood.

It’s The Vision Thing

Obtaining a renewed vision of buyers today takes a commitment to let go of long held assumptions and investing in getting to know them qualitatively.  While new technologies in quantitative big data and data mining can provide some insights, this alone cannot offer the deeper qualitative insight into which attributes result in powerful laws of attractions that make your organization likeable in the eyes of buyers.  Modern day techniques and efforts such as predictive buyer modeling, descriptive buyer scenarios, modeling buyer values, and etc. can go a long way in renewing an organization’s vision of groups of buyers.  However, it starts with a commitment to seek a new vision of buyers and change the trajectory of the organization’s future.

Trajectory is a complicated concept highly dependent upon vision.  You have to first find out where you need to be going and to see where you are going.  Getting a renewed vision of your buyers and becoming likeable in their eyes gets you moving in the right direction.

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How To Get To Know The New SMB Buyer

©All rights Reserved Peter Schofield

This is part 2 of a series on the challenge of targeting SMB markets and how the use of buyer modeling and buyer-based marketing help organizations to grow their SMB customer base. 

In the first article of this series, we visited two new realities.  One, that many Fortune 1000 and Global 2000 organizations are turning a focused eye towards growing their SMB customer and revenue base.  With revenue growth potential shrinking in larger strategic accounts due to budget and pricing pressures, many are dedicating attention and resources with more determination than in the past.  The second reality is that they are finding a very different buyer this time around than in the past.  Simply put, SMB buyers are more social, more sophisticated, more connected, and are transforming their buying behaviors at an accelerated pace.  New technologies opening their world to advantages only once afforded to large enterprises.

Waking up to these new realities has set up another challenge for executive leaders.  That is of how to get to know the new SMB buyer.  Here’s how one sales executive put this to me recently:

“One of the things we realized is that we have got to get to know our SMB customers.  If you keep in mind that we haven’t really dedicated much resource to this area, then we are lacking in knowledge per se’.  We’ve got to find out what is important to them versus just giving them some generic sales pitch.”

This is a very salient point for many organizations tend to view the SMB as a whole segment in of itself.  The reality is that the SMB is highly fragmented and consists of many layers of sub-market segments.  Getting to know what makes SMB buyers tick is, by no means, as easy as saying this is your SMB buyer.  Layer on top of this the enormous changes in buyer behavior, the invisibility of SMB buyers in their sourcing for information, and new empowering technologies makes this endeavor a higher mountain to climb.  It is no wonder many executives are walking out of their meetings where SMB growth is identified as a top priority saying – now what?

Getting To Know The New SMB Buyer

The first tough challenge is realizing that viewing the SMB as a single market and that rudimentary means of segmenting by employee size and revenue figures are not going to result in the understanding needed.  While vertical segmentation is of significant help, what is paramount is knowledge of how these sub-markets and buyers within behave.  What are steps that executives can take to understand the new SMB buyer?

Buyer Research: This has to be a clear mission.  Getting to know the new SMB buyer is going to take some level of buyer research.  It is going to take the integrated approach of committing to both quantitative and qualitative approaches to understand the full 360 degrees of the new SMB buyer.

Buyer Modeling: Depending on the degree of fragmentation in sub-markets, powerful buyer modeling can be an extensive exercise.  However, one well-worth the upfront investment to get to know the new SMB buyer in ways that transforms efforts into an order of magnitude competitive advantage.  There are several areas of modeling that by understanding them deeply, can make your organization relevant to buyers and core to their problem-solving:

Buyer Persona Modeling: What is important here is not to model the single archetypal buyer but to model the new levels of interactions buyers are having with newly formed ecosystems and networks.  They may be SMB but they are growing exponentially and organically by creating new ecosystems.  Buyer persona modeling represents composite archetypes based on behavioral research with a focus on identifying critical goals that drive buyer behaviors.

Buyer Scenario Modeling: To get a handle on the problems SMB buyers face and what confronts them, modeling buying scenarios can give your marketing and sales teams insight into how to be relevant.  Additionally, this gives you the ability to address fragmentation and identify sub-market segments that have the best optimal scenarios to be part of the SMB buyer’s solution.

Buyer Decision Modeling: How SMB buyers are making purchase decisions today is changing so fast and by sub-markets that not monitoring this aspect of a SMB strategy can put an organization behind the curve.  While looking at the buyer decision journey can be fruitful, in my qualitative research I’ve noted how the new SMB buyers are adept at more ad-hoc decision-making.  Furthermore, with the rise of ecosystems and networks, collaborative efforts in making purchase decisions are not so neatly streamlined.  Newer technologies are also making purchase decisions more decentralized than ever – making fragmentation on this issue even more complex.

Buyer Value Modeling:  SMB buyers’ value varies widely by sub-market segments.   Gaining insight and modeling how these values operate in their day-to-day world can help you to tailor offerings and communications to fit specific sub-market segments.  Depending on the industry and markets, values in the SMB take on a deeper emotive texture and can be a deciding factor in purchase decisions.

Avoid Big Data Trap

With the rise of big data, there will be a tendency to try and “cut the numbers” every which way to make sense of the SMB market challenge.  When dealing with 5,000 SMB accounts to 150,000 SMB accounts, the tasks of getting to know these SMB buyers at a deeper level can look downright daunting.  Analytics will play an important role towards reaching understanding.  I also contend and advocate that qualitative and predictive buyer modeling is essential to integrate into the mix of discovering the new SMB buyer of today.  Buyer behavior within the SMB world is rapidly changing.  A reasonable assumption can be made that in some SMB sub-market segments it is changing at a faster pace than that of larger organizations.

The combined use of analytics and predictive buyer modeling can yield an insightful picture into how these new behaviors translate into uncovering why buyers make purchase decisions.  And, get closer to the holy grail of uncovering the reasons why they would change.

Next Up: The Importance of Buyer-Based Marketing in SMB

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Your Top Priority Is Growing The SMB Revenue Base – Now What?

 

Do Your Research Before You Pick Up The Phone © All Rights Reserved Kenny Madden

This is part 1 of a series on the challenge of targeting SMB markets and how the use of target buyer modeling and buyer-based marketing help organizations to grow their SMB customer base. 

As we continue to come out of the deep freeze over the last few years, we are beginning to see encouraging signs of an economic recovery.  However, the purse strings are still drawn tight and new patterns of buying has created an atmosphere of even more exacting pricing pressures from enterprise-wide level buyers and accounts.  This means less room for revenue growth to come directly from the fabled 20-30 percent of large customers who typically have made up 70-80 percent of total revenues.  This is how a VP of Sales in the software industry put it to me recently in my research:

“Here is what it looks like…we are actually selling more of our product into our larger accounts than ever before….but…over the last three years we’ve faced stiffer competition that has driven our pricing down.  So the net-net has been that we are just holding on as best we can to these larger accounts.  Another words, we are not getting significant real revenue growth from them.”

It is highly likely that this refrain is being repeated across many Fortune 1000, Global 2000, and even Inc. 500 listed companies across the globe.  With revenue growth opportunities shrinking among their large accounts, senior leaders in these organizations are turning a focused eye towards the highly sought after small and mid-size business segment.  For instance, in the highly compettive world of IT Products and Services, both HP and IBM made substantial investments and strategic moves in 2011 to target the SMB segment.  Challenging Dell and its’ low cost entry strategy for small to mid-size businesses.

A New Challenge And A New Frontier

There is good reason for Fortune 1000 or Global 2000 companies to target revenue growth from the SMB segment.  It is one of the fastest growing segments and traditionally has been coming out of a recession.  It also has proven to be lucrative when you consider that actual contribution margin percentages are much richer per sale when compared to large accounts.  It is little surprise that senior executives have shifted at least one eye towards expanding their SMB customer base and tapping into the revenue growth potential that can exists.

While targeting or at least accounting for the SMB segment is not a new idea to larger enterprises, this time around they are waking up to new buyer realities.  Buyer behaviors continue to change rapidly and these new behaviors are associated with largely buyer-driven changes.  What is confronting those wanting to achieve revenue growth from SMB buyers and companies is that they may know very little about these buyers and companies.  How to market to SMB buyers and companies becoming one of the hot priority items showing up on the agenda of many large enterprise management meetings being held daily, weekly, or monthly.  As one Senior VP of Sales and Markerting in IT pointed out to me recently:

“I am almost afraid to admit that we may have taken the SME (my notation: some executives refer to SMB as SME – small and mid-size enterprises) businesses for granted all these years.  We never really moved beyond segmenting by employee size and revenue so we really don’t know a lot about SME’s as we should.  It’s easy say you want to target them but planning how to target them is basically a whole new ball game for us.”

Because little knowledge may exist about SMB businesses and buyers, there are perhaps more assumptions being made about SMB than for larger accounts.  Generalized perceptions and preconceived notions run rampant in the halls and meeting rooms of larger enterprises attempting to figure out how to market to SMB segments.  There is what I call a “definition churn” that can happen when knowledge is found wanting – new definitions, classifications, segmentations, and etc. begin to appear every 3, 6, 9, or 12 months.  Moving around 1,000’s of accounts and prospects in virtual databases to new buckets created for employee size, revenue size, product targets, and verticals.

Unprecedented Transformation Occurring

In the past, working with these definitions may have been sufficient.  Looking ahead into the future - and the near future at that – these definitions alone will no doubt prove to be limiting and even detrimental to growth.  We are experiencing an unprecedented transformation in the world of business with new buyer-driven economies, ecosystems, networks, and communications emerging constantly – making understanding of SMB buyers and companies that may have been attained even as little 3 to 5 years ago nearly obsolete.

For many large enterprise organizations that show up on the famed Fortune 1000 or Global 2000 lists, growing the SMB customer base may be their number one, or at least in the top five, priority.  It is also, as a result of new buyer realities that are emerging, their number one challenge.  To tackle both angles of this two-sided coin, gaining deeper layers of understanding about SMB buyers and companies will need to get on these same priority lists.

Next Up: Understanding New Buyer Realities In SMB

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3 Ways To Connect With Today’s B2B Buyers

Pamban Bridge ~ Connecting Rameshwaram Island
Image via Wikipedia

This is part 4 of a limited series on why buyer choice modeling is the new view B2B Business must adopt to improve revenue performance and develop long lasting relationships with buyers.

Connecting with today’s B2B buyers is on the minds of most CEO’s and their teams today.  Not too long ago, reaching and connecting with B2B buyers was a straight forward proposition.  Depending on surveys from such sources as IDC, IDG Connect, DemandGen Report, Forrester, and more, we know that buyers are remaining invisible to B2B businesses and spend only a quarter of their time talking directly to sales when making purchase decisions.  The idea of connecting to B2B buyers has gone from straight forward to major league complex.

There are plenty of debates regarding the best tactical means to connect with B2B buyers.  The effectiveness of these tactical means, as reported by once again the likes of IDC and etc., show that many B2B leaders believe these tactical efforts such as content marketing and marketing automation may only be effective about a quarter of the time.  It does represent a big gap and it begs for a rephrasing of the challenge – this a big disconnect with B2B buyers.  Enough to keep any sane B2B CEO and their senior management team scrambling for answers.  Part 1 and part 2 of this series pointed out that conventional funnel thinking is woefully inadequate in today’s B2B buyer landscape and is limited in the ability to address new and evolving complexities.

Determining new strategies as well as tactics that can meet the challenge of connecting with today’s B2B buyers revolve around understanding new buyer psychology and dynamics that are in a state of continuous evolution.  B2B businesses can do three things to help grasp the connection issue and make plans that close the gap:

Buyer Modeling To Understand Buyer Choices and Scenarios

Business executives today are using the concepts of buyer modeling to understand as well as visually illuminate buyer choice.   Buyer modeling incorporates the elements of attitudes, beliefs, values, goals, perceptions, needs, and motivations.  By modeling buyers, buying scenarios, buyer experience, and decision journeys, B2B executives can then map strategy as well as tactical marketing and sales activities that enable them to connect with B2B buyers on a relational level.  Buyer modeling is based on qualitative research that addresses choices being made versus inadequate interviewing that is done in the context of the funnel.

Focus On The Total Brand and Buyer Experience

B2B businesses are learning how to think outside the context of the funnel and how to encompass the total view of the brand and buyer experience.  The invisibility of buyers who are in explore and network mode of the buyer choice model makes it an imperative for B2B businesses to better understand how different buyers interact with different channels that create impressionable brand and buyer experience.  The emphasis here is on identifying critical Buyer Moment of Truth™ impression points that contribute to the overall brand and buyer experience.  For example, does the web channel brand and buyer experience stay true to form when buyers interact with either the social media, sales, resellers, partner, or service channels?  HP, for instance, has a strong ecosystem of reseller and partner channels where the brand and buyer experience has many potential pitfalls and has several challenging Buyer Moment of Truth handoff points that can make or break their involvement.  B2B leaders today can conduct buyer experience mapping that identifies critical Buyer Moment of Truth and ensure that the brand and buyer experience stays true to form throughout.

Descriptive Buyer Segmentation Based on Buying Behavior and Opportunity

By integrating the benefits of predictive analytics with that of predictive buyer modeling, B2B leaders are gaining smarts on taking segmentation to a new level.  With the use of visually illuminating B2B Buyergraphics, buyers can be segmented descriptively by explore and buying behavior and also by modeling buying scenarios that identify where the organization can reach a “best fit” level with buyers.  This can be especially useful in industries where there is a strong company or account focus as well as complex buying scenarios that involve lengthy buying cycles.  Descriptive means of segmentation helps to illuminate the many elements related to choice, needs, goals, attitudes, behaviors, values, and experience.  This approach enables both marketing and sales to focus on resonating with buyer segments that have similar goals and buying behaviors where knowledge in doing so is dynamic and enriched with each company or account interaction.  In essence, allowing B2B businesses to build strong connections with B2B buyers in buyer segments that have higher winning percentages.

When B2B leaders can do these three things, they can be better informed on how to guide the overall trajectory of their organization.  Their focus is on identifying the buyers and buyer segments that they can best establish a connection within the context of understanding choices being made.  More importantly, they can learn how to connect with B2B buyers today in ways that resonates and invites participation into the buyer driven world of goals, challenges, issues, uncertainties, and growth objectives that orbit them continuously.

Next up: Transforming B2B Business

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How B2B Leaders Respond to the Psychology of Buyer Choice

© All Rights Reserved Kenny Madden

This is part 3 of a limited series on why buyer choice modeling is the new view B2B Business must adopt to improve revenue performance and develop long lasting relationships with buyers. 

When it comes to understanding the psychology of the buyer, much has been done in the world of B2C to get inside the mind of consumers to understand buying choices and preferences.  For B2B, it has been harder to translate B2C research dynamics into ways that would make the psychology of B2B buyers more readily understood.  However, what we do know is that there is an increasing consumerization effect happening in B2B buying whereby B2B buyers have the same desires for more experiential purchasing as opposed to a heavy emphasis on sterile transactions.

In part 2 of this series, I discussed the Buyer Orbit and the elements of the Buyer Choice Model.  Each of these now filled with more psychological aspects related to why B2B buyers buy.  This comes with many implications for B2B leaders to not only understand new buyer psychology but to also shift business models, operations, strategies, and interactions that transforms the way they connect with B2B buyers.  In part 3, let us look at how B2B leaders are responding to new buyer psychology in relations to the elements of the buyer choice model.

Psychology of Buyer Choice

Understanding buyer choice has many implications for B2B strategies and tactics – whether they are focused on demand generation, content marketing, or selling approaches.  Addressing new buyer psychology and buyer choice paradigms, within elements of buyer choice modeling, can be transformational:

Explore

With more and more buyers mapping out exploration due to the proliferation of content and information channels, a side effect of B2B businesses scrambling to be noticed in the 50% to 70% window of buyers remaining anonymous, B2B businesses are considering the implications of buyers taking deliberate action to map out their exploration.

What this means: predicting and modeling how buyers map and begin their exploring as well as what forms of navigation they usually take specific to their industry.

How to respond: devote more resources to qualitative investigative means, such as contextual interviewing and ethnographic research, to uncover how buyers begin their efforts to explore and how they are dealing with content proliferation.

Network

As elaborated upon recently, the single buyer model is no longer sufficient and more and more B2B buyers operate from the new buying model of working within ecosystems and relying on network participation.  Codependency is here to stay and B2B businesses must adapt.

What this means: reexamine how buyers are viewed internally and what forms of outmoded approaches may be resulting in missed opportunities.

How to respond: use various forms of B2B buyer research and begin working with buyers to understand important ecosystem and network drivers for their business and industries.  Incorporate important ecosystem views into strategy and organizational infrastructure.

Decide

The art and science of decision-making is becoming more complex each year.  An increasing number of variables are being introduced into decision-making such as globalization, uncertainty, ecosystem considerations, and more – shifting how buying is taking place.

What this means: how buyers are buying today is shifting dramatically and B2B businesses need to understand the new rules of decision-making, in addition to the buyer decision journey, that are being implemented for purchase decisions.

How to respond: shift internal focus to understanding new rules affecting decision-making, acquired through the mix of analytics and qualitative insight, and support how buyers are making purchase decisions.

Buy

Buying today, as mentioned in part 2, is a higher stakes game for many businesses today.  The margin for costly mistakes is the slimmest in decades.  The extent of poor choices can have disastrous effect on many aspects of a business.  Understanding high stakes motivations enables a focus on why B2B buyers buy.

What this means:  B2B leaders must not confuse how buyers buy with why buyers buy.  The focus here is on understanding the new buyer psychology in terms of their collective attitudes, goals, beliefs, perceptions, and drivers.  This new collection of mental models are changing each time new variables, such as new technologies, are introduced.

How to respond: getting an understanding of buyer mental models through qualitative research efforts will become more crucial each year as buyer psychology continues to shift.

Relate

With higher stakes involved in decision-making and purchases today, B2B buyers seek more assurances post-purchase than ever before.  Unlike the emphasis on engagement in B2C post-purchase, the need for deeper ties relationally is affecting long-term loyalty.

What this means: shifting out of funnel thinking and viewing the entire buyer experience cycle is a new rule of B2B thinking today.

How to respond: post-purchase support and talent can no longer be an after-thought of organizational planning but be seen as the gateway to being included in newly formed ecosystems and networks by buyers.

What we are witnessing today is a marked shift from funnel-thinking to that of focusing on the total buyer experience that does not fit neatly into stages or step approach thinking.  The new buyer psychology compels B2B businesses today to make the buyer the centerpiece of strategy and respond to the continuous loops of what confronts them (the buyer orbit) and the choices (buyer choice model) they must make.

Next up: Impact on Marketing and Sales

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How B2B Leaders Are Understanding Buyers Better With Behavioral Buyergraphics

B2B Buying Process Today © All rights reserved by Kenny Madden

In the business-to-business world, the quest to connect with decision-makers has been and most likely will continue to be the main challenge confronting B2B leaders.  Meeting this challenge successfully is the essential lifeblood of survival for many B2B companies.  While today’s continuing convergence of the Internet, social technologies, and Enterprise 2.0 platforms are increasing B2B visibility like never before, connecting with buyers and decision-makers is becoming increasingly elusive.

For decades, B2B sales and marketing has relied on business information of the likes of Hoovers, Dun & Bradstreet, and others.  They provide the critical view of market segments and the companies that fall within those markets.  Business information also plays a role in providing B2B with a level of company profiles and firmographics data about organizations within markets.  Business information services also serve a valuable role in drilling down to help with contact information, such as newcomer Netprospex, to provide B2B with potential decision-makers they can reach.  On the other end of the business information spectrum, B2B leaders have relied on business and market research reports that help them understand strategically trends in markets and how they may be impacted.  These reports, often analyst generated, help to shape strategic vision and enable both short-term and long-term planning.

What has been missing?  Where is the void in today’s fast and furious changing B2B landscape?

As the rate of increasingly changing B2B buyer behaviors continues to skyrocket, the void for deep behavioral insight continues to widen.  Behavioral B2B buyer insights are becoming mission critical to informing, shaping, and adapting to changing buying behaviors that are coming in like ocean waves on a sandy beach.  Today’s B2B leaders are just beginning to understand the importance of behavioral analytics and insights for making informed decisions on how to allocate company resources to engage buyers in the new hyper-connected B2B world.

When I introduced buyer persona research and creation a decade ago, the premise then, as it is now, is that it is a methodology for understanding not only who your buyers are but how and why buyers buy.  The primary driver being that understanding goal motivation helped you to understand what drove buyers in decision-making.  What is becoming increasingly clear as a result of the changing B2B landscape is that buyer personas alone may be inadequate (especially as a result of the multitude as well as widening disparity in how buyer personas are defined today) and that gathering a new set of behavioral buyer insight is required to meet the challenge of today.  The B2B leaders facing challenging market dynamics, to fill the void of deep behavioral buyer insight, are becoming more aware of the value of what I term behaviorally oriented Business Buyergraphics™ to understand buyers better.

Understanding buyers better behaviorally is today’s “holy grail” of sustaining competitive advantage that can no longer be guaranteed standing pat for any amount of time.  Behaviorally oriented Market and Business Buyergraphics provide insight into and answers for several crucial questions:

  • How do we understand buyer segments based on purchasing behaviors?
  • How do we understand buying scenarios that we can meet?
  • How well do we understand the buyer decision journey?
  • Do we understand our buyer’s story and the narrative they tell?
  • What are the new buyer ecosystems and networks that affect purchase behaviors?
  • What do buyers think and what are their collective attitudes?
  • How do we know what type of content engages and how buyers will find, use, and share content?
  • Do we understand the critical moments of truth in the buyer experience cycle that affect purchase decisions?
  • Do we understand changing buyer values and how they impact purchase decisions?
  • How do we understand and distinguish the buying behaviors of emerging social buyers and traditional buyers?

The methods for gathering behavioral buyer insight and getting answers to these questions rely on what has been true for understanding buyer behavior – qualitative research and buyer interviews.  B2B buyer research has been heavily weighted towards quantitative surveying methods over the last few decades.  These types of methods remain extremely valuable – getting deeper and understanding buyers better behaviorally however requires some shift to the qualitative.  It will also require a degree of savvy integration of analytics and qualitative behavioral insight.

Without going into an extensive treatise on the tools and methods of behaviorally oriented Business Buyergraphics, they are designed to provide data and insight elements related to:

  • Insight into evolving buyer persona ecosystems and networks
  • Understanding buying scenarios that affect purchasing behaviors
  • The mental models of buyers that affect purchase decisions
  • Insight into buying processes and the buyer decision journey
  • Insight into how buyers find content and share content
  • Modeling the buyer experience to understand critical moments of truth
  • Insight into the perceived values of buyers that shape purchasing behaviors

These tools and methods are utilized to collectively tell the story of how buyers behave when making purchase decisions.  The purpose of behavioral Business Buyergraphics is to enable B2B leaders to understand buyers better in terms of their purchasing behaviors.  This understanding and set of deeper buyer insights informing B2B leaders on what they need to know to shape sales and marketing strategy that are going to work in today’s B2B landscape.  Or, as many would say: at least a working chance when the ability to peer around the corner is getting harder and harder to do.

Understanding buyers better and deeper today as well as more intimately requires filling in the void of the business information spectrum.  Filling the void with behavioral insight into how buyers behave when making purchase decisions and understanding various segments by buyer purchasing behavior.  B2B leaders, who are intent on winning, understand that what they think matters very little – unless they have a good idea of how their buyers think.


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How Buyer Perceived Risks (BPR) Affects Buyer Behavior and Purchase Decisions

"Risk"Image by IceSabre via Flickr

The notion that perceived risks influences purchasing behavior has been around for quite some time.  As we have seen an increase in the complexity of the buying process, we are seeing a correlating increase in Buyer Perceived Risks (BPR)© associated with purchase decisions.  Compounding perceived risks is the increase in choices as mentioned in my previous article as well as new social channels to explore.  This new mishmash of complexity, choices, and new channels causes a much higher degree of uncertainty on the part of buyers.

What does understanding choice have to do with Buyer Perceived Risks (BPR)©?  It comes down to two general areas:

Buyers are dealing with the uncertainty and the risks of making a bad choice

Buyers are dealing with the unknown consequences resulting from a bad choice

These two general areas of perceived risks are not necessarily new however the degree of impact has expanded significantly as a result of the convergence of the Internet and Social Technologies.

Bpr impact

Variables that are affecting the degree of impact include speed, awareness, chance, and reputation.  Put more simply:

The impact of a bad choice is happening much faster, more people as well as organizations are aware when they happen, there are fewer chances to recover, and more damage to individual as well as company reputation.  The end result being that buyers are perceiving risks to be greater than ever and making the right choice more challenging than ever. 

Previously, I had written about Buyer Perceived Values (BPV)© and the need to understand how buyers prioritize values.  The other side of the coin is to understand Buyer Perceived Risks (BPR)© and to understand how buyers see the degrees of consequences that can result from a bad choice.  This calls for senior executives and strategists to increase their understanding through what I call Buyerology© -  which represents a deeper qualitative level of buyer intelligence.  Gaining deep understanding of complex perceived values and risks provides a window into the mind of the buyer as well as the business culture of an organization.

What research with C-Suite executives has borne out is that this understanding arrives too late when it comes to new services, products, and strategies.  Oftentimes, learning the hard way why a new product launch, a new service capability, or a much hyped strategy implemented fell flat on its’ face – and both seller and buyer reputation bruised and battered.  To prevent their own consequences, selling organizations will need to improve their early-stage buyer intelligence capabilities and make the investment upfront as opposed to investing in post-failure debriefings.

Improving buyer intelligence in Buyer Perceived Risks (BPR)© can lead to being informed on important decisions related to:

Pre-Sales Content: Providing knowledge and information that instills confidence in choice and reducing perceived risks.

Sales Interaction: Enabling sales to engage in conversations and interactions that authentically confront perceived risks and brings them to the forefront of the sales process as opposed to last minute barriers.

Post-Sale Implementation: Content, implementation services, and interaction can all be used to enhance a buyer’s perception that adverse risk has been avoided and value gained.

There is a given in all this.  The given is that a selling organization truly has the quality and the confidence that it can deliver for the buyer and that it has assurances in place that they can reduce Buyer Perceived Risks (BPR)© significantly.  No amount of content, smooth talking, and excuses will make up for poor quality and capability of a product or service.

Understanding perceived risks today through deeper qualitative buyer intelligence (Buyerology©) can go a long way towards organizations standing out from the pack of options that can exists.  Insightful understanding leading to helping buyers to make choices that are made with more ease, confidence, authenticity, and affirmation that ultimately results in hard sought loyalty.

 

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