B2B Solution Sales

From Products to Solutions

Many companies, especially smaller ones, start by

developing a product to replace an existing product. This is the building-a-better-mousetrap mentality. Many companies also think that the best way to win customers is to develop a superior product and continually work to make it better. In other words, they start with the product & services first and consider customer relations as an afterthought. This is an error in thinking! A better approach is to understand the customer by mapping out experiences.

Customer Experience Approach

Recent research discovered that only 8% of customers

think that their experience with their vendors were superior, whereas 80% of vendors think that they delivered a superior one. This research points out an obvious disconnect. By focusing on core products instead of understanding the customers experience, many companies lose their customer and never know why. Also, by not understanding the customer, companies lose an opportunity to create value and cement relationships.

Customer Experience Maps

One way to understand the customer better is to

Map out experiences at various touchpoints.

Touchpoints are spots where a seller has direct or

indirect contact with the customer about the product or service over time.
The map points out what is most important in the

seller/customers experience.

Ultimate Goal of Experience Map

The ultimate goal of an Experience Map is to identify: 1. The value that customers place on different levels of performance for each element of the experience. 2. The customers minimal expectations for each element. 3. The customers perception of the firms performance versus that of key competitors.

Once the map is developed, the next step is to meet with the customer and pare down the list to the most critical issues.

Customer Experience Life Cycle Map

The First Step in Understanding a Customers Experience is to Develop a Life Cycle Map
A representative set of customer-company interactions
Relationship initiation Provider evaluation Account setup Order placement

Product reception and use

The customer tracks order status The company and the customer arrange the final delivery terms The customer receives and inspects the product The customer refuses or accepts the product

Problem resolution

Payment

Account maintenance

The company exposes the customer to its marketing message

The customer gets initial price and leadtime quotes The customer puts out an RFP The customer evaluates providers and negotiates terms and pricing The customer selects the provider

The customer obtains materials for account setup The customer provides account profile information The company confirms setup and activation The company performs courtesy follow-up The customer requests product information

The customer selects the product The customer places the order (fills out the order form The customer prepares specialty documents when required (for example, for rush delivery) The company and the customer arrange initial delivery terms

The customer files a claim and obtains resolution

The customer receives and validates the invoice

The customer maintains profile information The customer maintains supplies The company provides general support (not related to problems) The customer obtains ongoing price quotes

The customer seeks relevant information

The customer notifies the company of a problem and obtains resolution

The customer seeks an invoice adjustment and obtains resolution

The customer makes the payment

Product- to a Solution-Centered Approach

Dont start with product first. Instead, start with

understanding the customers problem and end with products and services that solve that problem.
The exchange should not be transaction-based but

rather be an interactive exchange with the objective of developing a relationship around co-creating value with the customer.

From a Product to a Solutions Perspective

Product Perspective Value Proposition Value Creation Win by creating innovative products and enriching features of existing products Value is created by the firm Solutions Perspective Win by creating and delivering superior customer solutions Value is co-created by the customer and the firm

Designing Offerings

Start with the product or service, and then target customer segments
Transaction-based

Start with the customer problem, and then assemble required products and services to solve the problem
Interaction-based and centered on the co-creation of solutions Quality of customer-firm interactions

CompanyCustomer Relationship Focus on Quality

Quality of internal processes and company offerings

Determine Unique Capabilities

Before developing solutions, B2B firms must:
1. 2.

Define their own capabilities Figure out how to use them to help customers to: a. Reduce costs, Value Engineering b. Increase responsiveness c. Improve quality d. Maybe even contract to do some of the work

Products provide the platform for the delivery

of services.

Do Service Transition Strategies Pay Off?

To improve competitiveness many firms add services to

their existing product offerings to make 1. The firms value offering more unique 2. Duplication difficult for rivals 3. Products more valuable to customers
thereby enhancing profitability and firm value.

Does it pay off? 1. Confirmation comes when firms that add services see an increase in sales from 20 30%. 2. Adding services is more effective for firms that relate the service to their core products. 3. Adding services is effective in turbulent or slow growth industries, but counterproductive in stable or high growth industries.

Benefits of Solution Marketing

It offers: New avenues of growth 2. New ways to differentiate
1.

Growth Opportunities
Services, by their very nature, offer far more than

core products can offer.

However, marketers need to understand the true

need (problem) that core products presently solve.

Next, when looking at the core need, ask, Are

there other ways to solve that problem?

Other ways can lead to new products.

Growth Opportunities (continued)

Lets assume we have a great product that does the job.

What else can we do to gain more share- of-wallet?

Solutions marketing forces us to ask the question,

What other services can we provide to our customers that could solve related problems?

Example: Deere & Co. provides health insurance and

banking in addition to farm equipment.

What if Deere & Co. provided GPS to automatically

steer their new combine or added biosensors to test the earths mineral content?

Service Solutions Facilitates Differentiation

Business marketers who emphasize solutions

sustain differentiation because solutions offer a wider variety of services that can be customized to meet customers unique needs.
By co-creating solutions, business marketers

enhance loyalty resulting in the customer creating barriers for competition.