Awkward Reality #93

Forget a price premium… unless you deliver value beyond customers’ next best alternative.

93 Customer Value 1

If you don’t ask customers the right questions, you can’t quantitatively assess their next best alternative. So you’ll have to guess at pricing. Guess too high and customers won’t buy. Guess too low and… well, customers will let it go this time. And you leave money on the table, perhaps for a decade or more.

Read more in this free white paper, Catch the Innovation Wave (page 12), which details how your company can improve customer value and experience a significant increase in sustainable organic growth.

Awkward Reality #92

If you don’t use value calculators, you’ll likely suffer “value leakage” in your pricing.

92 Value Leakage

When you give customers a value calculator with hard numbers, you are much more credible and you build their confidence in your new product. And you boost customer “internal selling.” If your unit price is higher than competitors’, you can help your customer purchasing agent prove he’s a hero, not a goat.

Read more in article, Getting Top Price for Your New Product (Originally published in B2B Organic Growth) Resist the temptation to ask a customer, “What would you pay for this?” There’s a little alarm that sounds in the customer’s head saying you’ve stopped trying to help him, and are now trying to help yourself.

Awkward Reality #91

Will customers tell you what they want? That depends on how you ask.

91 Radio Interviewer

Think of a great radio interview. Did the host say, “I have 10 questions about your book”? Or did he listen carefully, asking wonderful questions? Did these questions cause the guest to think deeply? Did the guest enjoy the stimulating exchange, even thanking the host? This is how you learn what competitors miss.

Read this article, Should You Develop New Products like Steve Jobs? (Originally published in B2B Organic Growth). Have you ever heard someone say, “But Steve Jobs didn’t ask customers what they wanted.” Understand the flaws in this thinking for B2B suppliers.

The Significance of Market Concentration

The Significance of Market Concentration

In a concentrated market—where there are relatively few customers—B2B innovators should pursue customer engagement as well as market insight. Practical ways to do this include keeping customer objectives in the center, ensuring the interview process is a professional experience, and continuing to engage the customer after the interview. ... Read More

Awkward Reality #90

Expect more out of your interview with a hydraulic hose buyer than with a garden hose buyer.

90 Hydraulic Hose

You can have an intelligent, peer-to-peer conversation about pressure ratings, fluid specifications, etc. You can expect greater B2B interest vs. B2C, since your innovations can help the hydraulics engineer become a hero with his next new product. Without innovative suppliers like you, his path to recognition is a difficult one.

Read this article, B2B Customer Interviews: Are They Different?  to learn why you are severely under-optimizing if you are a B2B supplier using one-size-fits all VOC… that others use for consumer goods.

Awkward Reality #89

Customer value is only created when an important, unmet customer outcome is improved. Period.

89 Customer Value

Sure, you can develop products that you find exciting. But unless these products address something customers find important and unsatisfied, don’t expect them to buy them. And if customers do buy your product, they certainly won’t pay a premium. If you’re not happy about this, you’ll have to complain to Adam Smith.

More in white paper, Catch the Innovation Wave (page 8).

Awkward Reality #88

Lean Startup is fine for B2B… but don’t skip this extra “Learn” step.

88 Learning before Hypothesizing

The “Build-Measure-Learn” cycle in Lean Startup begins with a hypothesis, and is great for B2C. End-consumers can seldom tell you what will amuse them or increase their sense of self-worth. But knowledgeable B2B customer can predict their desired outcomes. So start with a “Learn” pre-step. Customers will tell you all you need if you know how to ask.

More in white paper, Lean Startup for B2B (page 3).

Awkward Reality #87

Awkward Reality #86

The forces moving a supplier from commodity to specialty come from within…or they don’t come at all.

86 Commoditization

There are many forces dragging your products toward commoditization: competitors trying to imitate your products… purchasing agents trying to standardize your products… new technologies trying to obsolete your products. In your quest toward specialty products, you’ll get no outside help. You own this one, baby.

More in article, The Commodity Death Spiral (Originally published in B2B Organic Growth newsletter).

Awkward Reality #85

If you like sub-optimizing, you’ll love using traditional voice-of-customer methods.

Traditional Voice of Customer

B2B companies have huge advantages over B2C, but they may not be obvious. After all, didn’t the same fellow who bought a rail car of soda ash also buy a can of soda pop? Nope. He changed… a lot. B2B customers are more technically savvy, objective, supplier-dependent, and can predict their needs. Careful reflection of these differences leads to different approaches.

More in article, B2B Customer Interviews: Are They Different?