It’s risky to incrementalize… but “great hope” projects often absorb huge resources and end with a whimper. What’s the answer? Get out more. Spend more time in customers’ worlds to reduce commercial risk. And reduce technical risk through open innovation, tapping into external technologies. You can’t thrive today without external insight. (Hmmm… “exsight”?)
More in 2-minute video at 42. Beware of New Product Incrementalism
Your company’s only path to profitable, sustainable, organic growth is understanding and improving customers’ important, unmet outcomes. Today this “understanding” is your best competitive advantage, simply because most B2B suppliers have far less customer insight than they could.
More in 2-minute video at 8. Rethink your major initiatives
If you’re asked to cross an unfamiliar chasm, would it be risky? Hard to say. Until you learn if you’ll face a bridge or a tightrope, you can’t assess risk (probability). You’re just uncertain. Many companies fear risk in an unfamiliar market, when they should map out a plan to reduce uncertainty. This is especially easy to do in B2B markets.
More in white paper, www.UnfamiliarMarkets.com (page 2)
Steve Jobs quoted Henry Ford, who said, “If I had asked people want they wanted, they would have said faster horses.’” But these men were end-consumers themselves, so they understood their markets. Most B2B suppliers, typically have much to learn about customer desired outcomes… and B2B customers are willing and able to tell them.
More in 2-minute video at 18. Avoid the faster horse fallacy
Good questions demonstrate you’re more interested in the other person than yourself. What do you call someone who listens to you and seems fascinated by your responses? You call them a brilliant conversationalist. Think of it this way: Your customers have a hard time getting their boss to listen to them. They go home and their kids don’t listen to them. Now a supplier (you) is leaning forward and asking, “Really? Could you tell me more about that?” If you were the customer, wouldn’t you like to talk to such a person?
More in white paper, Everyday VOC at www.EVOCpaper.com
B2C companies seek to understand customer needs. B2B companies should do this and engage customers, priming them to buy later. If you interview ten customers that represent 20% or 50% of the market segment’s buying power, wouldn’t it be an incredible waste if you failed to engage these companies… so they wanted to work with you?
More in 2-minute video at 29. Engage your B2B customers
I am sometimes asked to do a workshop on developing value propositions. I say, “Not unless you invite your customers to it.” Seriously, suppliers already spend far too much time guessing what customers want. Why try to legitimize this innovation malpractice by creating and word-smithing value proposition statements internally? Better to conduct proper B2B interviews and then build a value calculator around a value proposition that customers truly care about.
More 2-minute video at 34. Use value calculators to establish pricing
Here’s the “B2B Advantage”: Your customers can offer more insight than end-consumers due to their knowledge, interest, objectivity and foresight. But if your company uses hand-me-down consumer goods voice-of-customer methods, you’ve ignored your own advantage. Your competitors may not.
More in 2-minute video at 15. Put your B2B advantages to work
Imagine your business stopped innovating, your profits declined, and it is now budgeting time. To salvage next year, you’ll likely cut long-term costs, e.g. R&D or marketing, further reducing your ability to create high-value products. Next year, you’ll have even fewer options. This results in death or irrelevancy. If you’ve started this spiral, pull out quickly.
More in 2-minute video at 9. Avoid the commodity death spiral
Most financial business reviews are like standing around the output die, exhorting the extruder to do better. But nobody’s checking the feed hopper. It looks like an intelligent meeting, discussing gross margins, price increases and growth rates. But these were predetermined years earlier, largely by your new products, what you put into the feed hopper.
More in 2-minute video at 10. Extend your time horizon
Lean Startup is a powerful approach for quickly testing assumptions and minimum viable products. But B2B customers can articulate their needs in amazing detail—if you know how to ask. If you start with your ideas, instead of diverging to all customer outcomes, you may be converging prematurely and limiting your possibilities.
More in white paper, www.leanstartupforb2b.com (page 2)
Most B2B suppliers work too hard during interviews: Would you like this?… How about this?… Would this help? Better to probe a customer problem or desire to full comprehension, and then simply ask “What else?” This allows them to lead you to whatever they think is important. This is a customer-led interview. You should try it.
More 2-minute video at 26. Build your interviewing skills
Great value propositions begin and end with customer outcomes. It’s like collecting specimens, sliding them under your microscope, and continuing to turn up the magnification. The careful researcher doesn’t have to agonize over the right value proposition. It comes into increasing focus, waving its arms and screaming to be addressed.
More in white paper, www.b2btimingiseverything.com (page 9)
You can ask for pricing decisions using a survey, e.g. Van Westendorp. But it’s hard to get a straight answer in concentrated B2B markets: They know they’ll be negotiating prices later. Better to understand the customer’s world so well you can create a value calculator… to model their pricing decision-making. You’ll have longer-lasting insights vs. a one-time survey.