Why is this so?
It's rather simple actually. Most B2B value propositions are about the vendor, not the customer. That's because, at least in B2B, what the customer needs, and particularly what they value, is different depending on the industry they are in, the company an individual works for, their position in the company, their local culture and more.
Of course, there are many shared things that business people care about - lower risk, higher revenue, increased profit, reduced expenses - but because these are so universal and so general, value propositions that focus on them are, as I mentioned before, bland and generic.
If you sell a complex B2B solution that applies to many different kinds of company it's challenging to come up with a one-size-fits-all value proposition. So don't.
Instead of having one all encompassing company-wide value proposition, have a number of different ones depending on the audience you're aiming at.
That may sound even harder. In fact it's much easier. Here are two real life examples of very effective customer focused value propositions - and a process for developing one.
My client was a full service digital agency. They did a lot of stuff - pretty much everything to do with the web. Their potential marketplace was massive - any company with a web site, from large multinationals to SMEs. Their list of services made a Chinese restaurant menu look anorexic.
They had a list of blue chip clients, their founding director was a well respected industry doyen and, when he talked to senior executives about their business issues and how to solve them he could impress them with his erudition. Once he got in to talk to the right person they could win business easily.
But their problem wasn't winning business - it was getting in front of the right people. There are so many digital agencies all promising the same things, all with blue chip clients and all with excellent credentials that getting through the door was a major problem for them.
So when they came to us for help we asked them which niches they would like to target, and which business issues they could solve.
Their answer was "We can target almost anyone and we can help with any digital and internet related issue."
This presented a problem. If you don't know what you're aiming at it's rather hard to hit it and a value proposition saying "we can do anything for anyone" is pretty vague. Plus of course the amount of other digital agencies that can say exactly the same thing is larger than the number of fleas on a camel's back. It's not exactly an approach that makes you stand out from the herd.
So we set out to narrow it down.
Developing the value proposition
When we develop a customer focused value proposition we ask a number of questions;
- What is the specific objective of this value proposition for this campaign?
- Is there a particular niche industry where you have credibility - existing customers, success stories, etc.?
- Once you have chosen a niche, what pressing business issues do they havefrom their perspective that they really care about?
- Which of these issues can you genuinely help them with?
- Who are they - i.e. which are the specific companies you want to target?
- Which specific people do you want to target - the CEO, CFO, CIO, Director of Sales and so on?
- What language do they use to describe the issue? (In other words, do they have their own jargon that we can use to show we are thinking from their perspective?)
In this particular case my client had customers, credibility and genuine experience with retailers so we choose them as the niche we would approach.
That made my job rather easy. This was in late 2013, when competition from on-line retailers was a major issue in Australia. The business pages were full of the CEOs of large retailers bemoaning unfair competition from online retailers and downgrading their forecasts.
So the answers to my questions were as follows;
- The objective was to get a relevant, senior, C level executive to talk to our client
- The niche was large retail chains with 50+ stores
- Their biggest issue was online competition
- Our client could genuinely help them to compete better with online retailers (by helping them implement a multi-channel strategy - something my client had expertise in)
- We obtained a list of the top 60 retailers in Australia
- We agreed to target the CEO, CMO and Head of Digital (or equivalent) in each company.
- The retailer's language wasn't particularly relevant in this case
The value proposition - and what happened next
The final value proposition we created was "We help retail chains compete better with online retailers".
We approached the targeted people (CEO, CMO, Head of Digital) in the 60 retail chains with a coordinated campaign, starting at the top and using a combination of the phone, voice mail, email and conversations with gatekeepers and the executives we reached. We communicated one single, clear message - "We'd like to talk to you for 20 minutes about helping you to compete better with online retailers."
The result? We scheduled executive meetings for our client with 31 companies - largely (but not entirely) at C level - I think about 9 of them were with CEOs. Of those 31 companies 17 agreed there was potential to work with our client and the campaign generated a multi-million dollar sales pipeline.
In retrospect this was a pretty simple project - there was a glaring business issue we knew retailers would respond to. But this approach also works well when things are less clear cut.
Finance industry example
Our client was one of the largest software companies in the world. They wanted to target "second tier" (their words, not mine) financial institutions - which they defined as insurance companies, health funds, credit unions and regional banks. These were all defined by our client as being part of the same industry group, "finance and insurance".
We gently pointed out that, while these were all in the same industry group as far as our client was concerned, the respective companies wouldn't see things the same way. Credit unions see themselves as being very different from health funds, regional banks don't think they are insurance companies. Even within insurance there are several different kinds of insurer. All these sub-sectors of "finance and insurance" have their own unique business issues.
Any value proposition that tried to target all these niches together was doomed to be generic rather than specific. So we agreed to split them into different campaigns, each with its own customer focused value proposition.
Looking at credit unions as an example, we researched industry reports (from companies like KPMG), the credit unions' annual reports and their web sites to understand the issues they currently cared about and the language they used to describe them.
At that time (mid 2014) the biggest issues for credit unions issues were industry consolidation (i.e. mergers), changing status to become banks, increasing home loan approvals and improving their cost/income ratios.
Our client couldn't realistically help with the first two issues - industry consolidation and becoming a bank - but they could credibly claim to help with the other two.
So our final value proposition was "We help you to increase your home loan approvals and improve your cost/income ratio".
It wasn't particularly sexy but it addressed the things they cared about (i.e. that senior executives in the credit unions cared about), in their own language. The result was 21 meetings at C level or one level below, a high proportion of future opportunities and another multi-million dollar sales pipeline.
Developing an effective customer focused value proposition
There are a number of requirements for a well crafted - and effective - customer focused value proposition;
- It should talk about things the customer really cares about
- It should use the customer's own terminology/jargon/language
- It should be tightly targeted - the more specific the business issue the better
- It should be believable
- You must be able to deliver what you promise
- It should generate curiosity and make the person who sees it want to know more
- It should be short, sharp, easy to say and easy to understand
- It shouldn't talk about the vendor or how the value is delivered - that's a conversation for a later day (or for a different web page)
When you're creating a customer focused value proposition there's a clue in the name to help you - it's called a value proposition. It should be all about the value the customer receives - and value, like beauty, is in the eye of the beholder.
What's valuable to the CIO of a regional bank may be very different to what's valuable to a CEO of a Credit Union, while something that a CMO in a marketing agency lusts after might turn the stomach of the COO in a manufacturer.
Trying to find a single value proposition that hits home to a wide variety of people in a large number of industries is an impossible task. Either it will hit the mark with some people and miss it totally with others or it will wash harmlessly over them all, as just another self serving piece of puffery with little or no value.
There's that word again.
This article inspired a follow up article on LinkedIn here. If you'd like to connect with me on LinkedIn please send me an invitation via LinkedIn here.
If you sell to senior executives, if you are a senior executive or if you help people who sell to senior executives please join my LinkedIn group, Executive Sales Coaching
Steve Hall is an executive coach and a sales coach. He helps his senior executive clients to be more productive, more focused and to have more time for the things that really matter.
And he helps sales executives to sell more and to build relationships at a higher level.
He is a member of Sales Masterminds Australasia and this article is taken from the recent eBook published by the SMA. If you'd like a copy drop him a line.
He can be contacted on LinkedIn at https://au.linkedin.com/in/stevehallsydney onTwitter at @stevehallsydney,or by phone on 0410 481 960. He's based in Sydney, Australia.
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