Simplify customer buying process

Buying cycles of a product (especially B2B) takes really long, long buying cycles are really exhaustive. There are certain areas of the buying stages that could be optimized to reduce the overall time taken to conclude the buying cycle. I have summarized 10 such tips that could be optimized to shorten the buying cycles. Much of what was explained below might be exclusively applicable for B2B products.

  1. Simplify buying process
  2. Talk about solutions, not the product
  3. Know the decision maker
  4. Be available at the right time at the right place
  5. How are you different from others
  6. Well planned trail – To articulate the product value
  7. Communicate the RoI
  8. Innovative or Flexible pricing
  9. Inventory management – Eliminate the lead time
  10. Lastly, be honest

This blog is the last part in the series of blog posts on ‘Why to comprehend customer buying processes

In my earlier blogs, i have extensively spoke about what customers look for in a product, what parameters do they consider while making decisions during each stage of the buying process or rather what information need to be provided to customers to facilitate them to make right buying decisions.

Stages of customer buying process

Facilitating customers to make right buying decisions

Importance of perception

Simplify buying process

In case of B2B and B2C products, much of the delay is caused by inability to pick a right product due to plethora of products that are almost similar. Simplifying the buying process by making customers choices easier and facilitating customers to make the right buying decision could shorten the buying cycles.

I have already talked about in detail on how to understand the customer needs and just provide those details on how product can address their details in my earlier blog posts. If there are multiple SKUs, then help them make their choices easier. What often happens is that under the pretext of providing more details and more choices, Product Manager would end-up with more SKUs and tons of information about each of those SKUs. Searching for relevant information on which of those SKUs are perfect for the needs of the customer would be tantamount to searching for a needle in hay. Information overload pushes the customer away from the product.

 

Let me provide a small snippet on how to simplify the buying process:

Canon Camera Finder

Above is the product finder for Canon compact cameras. It is not too great, but at least better than nothing. The product finder lists certain product functionalities and help to filter the available products. In a way, it makes search easier. Instead of looking at the feature set of each product, prospective customers can just use the product finder to narrow the search down to handful of cameras. Nevertheless for a camera, the amount of memory and available auto options are also important and I would probably wish to list them in product finder to further simplify the buying process.

My worst nightmare is while picking a DSLR. Nowadays there are more novice photo enthusiasts and it is surprising that none of the DLSR manufacturers have buying guide in their respective sites to guide the beginners. I don’t want to be critique here rather the objective is to highlight the need to ease the buying process. If it is not easy to choose a product, customers just pick the easy route. They look out for referrers and it might probably work for certain well established brands with a loyal customer base. Worst case, the customers can be misled too. Somewhere down the line, the company is being a cause to push customers away.

To build an effective product finder page, identify the critical attributes that customer use to evaluate the product. In case of camera, the possible attributes could be (i) stylish, (ii) zoom length, (iii) price, (iv) auto/manual and (v) memory. Pick such attributes and determine the values under each of those attributes for customers to choose. Depending on the choices made by the customer, provide a list of matching product with an option to compare them.

Product

Talk about solutions, not the product

When the Product Manager is solution focused, (s)he is willing to take a giant leap to understand the customer environment, their needs and their pain points. Being solution focused, Product Manager does not restrict himself/herself to merely selling the product by highlighting its capabilities but will take a step further to elaborate how the product can fit into customer environment seamlessly integrating with other products to address their needs and pain points. Providing such clarity can help customers to shorten the time taken to understand how product perfectly fits to address their needs thereby making their buying process simpler and quicker. Solution focus is more important in case of B2B product.

Know the decision maker

It is a classic case of determining USER vs BUYER. If the USER and BUYER are two different entities, identify the respective entities early in the buying cycle. Invariably USER and BUYER both have different objectives. USER is concerned about how the product should be used to address the business problem more than how the product addresses the business problems or needs. BUYER would be more concerned about how the product addresses the business problems or needs and at what price points. Product Manager cannot talk to both the entities at the same length as their purposes vary. Identifying both the entities early in the buying cycle, will help Product Manager to address their concerns and convince the efficacy of the product to both of them in parallel. Doing so will eventually reduce the duration of the buying cycle.

Be available at the right time at the right place

When the need arises, customers start looking for products that can help them address their needs. Customer might visit a store or look online or seek opinion of experts/friends to identify available products capable of addressing their needs. Whatever be the case, identify all possibilities of where the customer could start looking or searching for products matching their needs. Make sure you have the engagement point in each of those possibilities to connect with prospective customers and create awareness about the product.

How are you different from others

My take on new deals of both existing and new customers is to understand both explicit and implicit needs. Later present those needs holistically back to the customers and highlight how best the product is addressing them. There should also be emphasis on emergent needs and how the product would evolve to address those needs. Invariably, every customer would then ask how you are better than competitors. So in most cases, it is required to highlight how the product address the needs better than the competition. Having competitive analysis handy would make the job easier.

Respect competition. Never bully competitors before your customers. Customers might not always favor chest thumping attitude. While being gracious, always highlight which attributes make you stand out in the crowd. Hmmm…. How does it matter to customer? Here again, don’t just blindly pick the attributes that make the product stand out, instead pick those set of attributes that matter most to customer. If a product does a specific functionality better than the rest and if it is of no use to customer, then it hardly matters to customer how well the product performs that functionality.

Use this principle even while responding to RFPs in case of a B2B product. Every product does well in certain aspects and not so well on others. While responding to RFP, what matters is that whether the product is better on aspects that are mattered most to customers and highlight the same as part of the RFP response. Doing so would help customers convinced about their choice of product without any further deliberations.

Well planned trial – To articulate the product value

Instead of treating trial as an overhead in the buying process, treat it as an opportunity to showcase the value of the product. In most cases, products from multiple vendors look similar on paper in such cases trial go a long way in demonstrating the tangible value and product differentiators. Even though the trial would be conducted independently by the customer, Product Manager should at least be part of the process to know what functionality is being tested, identify whether customer understanding of the product is aligned with the product’s actual behavior and capabilities. Even if the agenda for trial is set by the customers, Product Manager has to educate customers on the list of product capabilities that would matter most to their environment. Ideally trial delays the buying process, but it brings transparency to the buying process. If planned well and appropriate support is rendered to the customers, it would be possible to complete the trial quickly scoring few brownie points with customer to close the deal successfully.

Communicate the RoI

Is the product worth the price? It would be last question on the minds of every customer after they have zeroed in on the product. Product Manager efforts to convince customers on how the product could address the needs of customers better than any other competition can definitely help customers chose the product. However until customers are convinced whether product is worth the price, they would not go past the last phase of the buying process (ie Adoption stage). Every product (mostly B2B) need to have a RoI tool that can outline both tangible and non-tangible benefits of purchasing the product. Customers should get convinced that value derived from the product outweighs the price. Providing relevant RoI data would only hasten the buying process.

Innovative or flexible pricing

Pricing in case of B2B products might not always be rigid. Depending on the strategic importance of the customer, and volumes etc., different pricing options could be put forth before the customer depending on how they want to structure the CAPEX and OPEX. Certain customers have budget for HIGHER CAPEX but want considerably LOWER OPEX, few other customers want to follow OPEX model with relatively LOWER CAPEX. Understand the customer preferences and their budget constraints. Accordingly figure out the possibilities for any change in pricing. Since the approvals might take longer, Product Manager has to undergo this task in-parallel while the product is being evaluated. Remember the topic surrounding BUYER vs USER, the discussions with BUYER should happen earlier in the buying cycle along with the USER to understand the expectations of BUYER in terms of RoI, pricing etc and accordingly formulate the pricing strategy within the permissible scope.

Inventory management – Eliminate the lead time

This section might not be relevant if there is a conscious decision to create an impression of exclusivity of products by maintaining a constant inventory level leading to long wait times. Otherwise, Product Manager has to figure out how to reduce the waiting time. In case of B2C, this would be applicable for products like Cars. In case of B2B, with HW products there would always be a lead time. It would be the responsibility of the Product Manager to anticipate the future sales and pro-actively maintain the inventory. If there is big ongoing deal, in accordance with the probability of deal closure, Product Manager can alert manufacturing team to maintain appropriate inventory levels. Long lead times can have negative impact on the deal and it can also further extend the duration of buying cycle.

Lastly, be honest

Always be honest with your customers. If the product does not fit their requirements, be honest with them to indicate that the product might not be a best fit. Selling the product to a wrong customer is always worse than not selling. Product Manager might have made revenue, but there will be definitive long term implications. Customer would later realize that the product does not fit them well possibly jeopardizing all future businesses from the customer. The negative feedback from the customer might also have implications on other customers as well.

Being honest helps Product Manager to build a long lasting relationship with customers that might probably facilitates more sales in future. How someone could possibly explain why B2C customers would always buy product from a specific store or brand, why B2B customers directly raise a purchase order to procure products from a specific vendor without any RFP or evaluating any competitors. The only answer that I could anticipate is the TRUST towards the BRAND and the PRODUCT.

 

Innovation – A psychological barrier

This is the concluding part of the 3 part series on ‘How to stimulate innovation’.

When you talk to any of the engineers who don’t innovate and ask them for reasons, as per my experience, the only two responses that I could anticipate are ‘What is in it for me’ and ‘Innovation is not my cup of tea’. Regarding the former ‘What is in it for me’, I have already spoken about it in the 1st part of 3 part series (How to stimulate innovation). Regarding the latter ‘Innovation is not my cup of tea’, the response stems from the self limiting ability of the engineer(s) because most of them opine that Innovation is synonymous to being only complex and big. The self limiting tendency is what I call Psychological barrier to innovation. The thought that innovation is complex is the primary cause for self limiting tendency but the Innovation(s) can be as simple as listed in the blog post ‘Innovations – Keep it simple’ . The efficacy of the innovation is not measured by its complexity and scale but by the impact that it could create.

Self limiting ability prevents us from exploiting our full potential by drawing rigid boundaries around our comfort zone and providing an impression that our true capabilities are limited by those boundaries. But hardly do we realize that each of us have potential to innovate (at least incremental innovations, if not disruptive innovation). Just like hidden treasures in the world, there are definitely hidden talents within us (irrespective of the age). Few of us are fortunate enough to realize those talents by pushing our limits and expanding our comfort zone.

Though the DNA to innovate should have been inflicted in the minds of every individual in the college, nevertheless it is not too late for organization to do the job. Organization can pull engineers to take certain smaller steps that can eventually help them to expand their comfort zone. As a first step, Organizations should strive to break the myth that innovation is not always complex and big. To do so, organizations have to nominate existing Innovators as Influencer (remember Influencer in Tipping Point) to spread the message that Innovation is everyone’s capability and to provide motivational push to innovate.

Next in the sequence is to inculcate the ‘Solution Thinking’ among engineers as outlined in previous blog. Final step is to pull engineer to record their ideas through novel ways such as IDEA DAY or IDEA CONTEST where you coax a group of individual to share their ideas. Initially the focus should be on quantity of ideas and not on quality, later we can identify the patterns of those ideas to figure out what triggers each idea. Also institute mentors to help idea generators shape their idea. In this stage, the focus should be only on accumulating as many ideas as possible into the repository, never burden engineers to provide details such as the approximate $ value, target market etc. Those details should be provided jointly by Sales, Account team, PM after evaluating the applicability of idea to existing or new products.

Starting with above mentioned small little steps would instill stronger innovation culture into the Organization and one day lead the Organization to the cusp of major innovation.

 

Need for solution thinking to stimulate innovation

There are various types of innovations such as Product Innovation, Process Innovation and Service Innovation etc. Though I did not indicate explicitly, I was talking about stimulating “Product Innovation” in my earlier blog. One of the key drivers of product innovation is to derive new product ideas based on the deeper understanding of customers needs (both implicit and explicit). The new product idea can be based on application of new technology or any alternate product design that can enhance the usability or experience of the customers. The success of product innovation lies in our capability to understand both implicit and explicit needs of the customer. As I indicated in one of my earlier blog (The need for introspection of target market), the needs can change and it is the responsibility of Product Managers to keep well informed about the changing needs.

But focus of the blog is to facilitate engineers to gain broader understanding of the customer needs (at least explicit needs). Majority of the engineers keep themselves abreast with latest technology, the gap is only in the application of technology to generate new product ideas because of lack of awareness of customer needs. In other words, there is lack of solution thinking. Solution thinking is about the ability of engineers to successfully answer the following queries
Who is using our product?
Why are they using our product?
How are they using our product?

Solution thinking would facilitate engineers to identify product/solution gaps and it indirectly drives innovation to generate new product ideas to fill those gaps. We can make this very simple by having Product Managers communicate customer needs to engineers periodically through a forum or through streamlined process such as MRDs/PRDs. Later engineers can generate new product ideas based on those inputs. However customer needs are not something that is written on a wall, so by including engineers we are only expanding our capability to spot/understand more customer needs. Such inclusive focus will generate larger ownership among engineers and narrow the gap between product capabilities & customer needs.

We need to take a quick look at our history to figure out what is stopping our engineers from inculcating solution thinking. As a low cost deliver center, trtraditionally our focus has been on WHAT to develop and HOW to develop. Honestly our focus was never on WHY, please read my related blog post on the need to focus on WHY. Our emphasis on delivery excellence and engineering excellence etc has led to engineers working in silos with focus on specific modules of the entire product.

On the other hand, solution thinking requires a holistic view of how the product is used by the customers and how various components of the product inter operate to deliver a solution to the customer. By keeping our existing practices intact, I am only advocating for additional process (listed below) to inculcate solution thinking.

  • Product presentation delivered to all the new entrants to the product team. Product presentation would just have 3 steps
    • What is the product
    • Who are the users of the product
    • What are the specific business problems addressed by the product
  • Visual tools to explain how each element of the product interconnects with the rest of the elements
  • PRDs should not only list the features required but also highlight the needs that would be solved by those features.

The above 3 aspects might tell ‘Who is using our product’ and ‘Why are they using our product’. To understand ‘How are they using our product’, engineers have the distinct advantage of knowing it through support. While handling support issues, it is essentially that engineers’ not only focus on resolving the problem but to figure out how customer is using the product. We can do so through standard way of asking for the business implications of the problem for which support is sought. Customers define how the product is used and hence it is critical that we use customer support diligently to know how they are using our product.

 

 

How to stimulate innovation

If there is one thing that every organization on this earth wants to do irrespective of the size/market/geography is to INNOVATE.

As part of the innovation drive, all the organizations set innovation goals to file X number of patents in a financial year and increase the goal marginally YoY. Revenue realization targets are also set from those innovative ideas. Organization goals are further translated into BU goals and each BU will be entrusted with responsibility of filing a specific number of patents. Goals are good to have as it indirectly communicates the purpose of the organization and priority of the organization. By setting innovation goals, organization drives the message that innovation is critical for the growth. Therefore it brings-in necessary process to capture innovations and deliver those innovations in their products. But the hard truth is that less than 1% of the organization contributes to Innovation. So the first step in the Innovation drive should be to stimulate employees to innovate.

In order to stimulate innovation, we should not do the mistake of persuading individual to innovate. We have to make every individual in an organization to realize/understand what is in it for them to innovate. In my personal experience I have seen most of the engineers desire to learn/accomplish something different/unique. But those genuine aspirations get lost because of lack of thought process on how to trigger the journey to accomplish something different/unique. Everyone desires to move from point A to point B, but what we often do not do is to provide a moment of pause to ponder upon three critical aspects
WHY– Why to accomplish
WHAT – What to accomplish
HOW – How to accomplish

Taking a moment to work on the What/How/Why circle will help every employee understand the purpose of reaching point B and eventually trigger clarity on how to start the journey of reaching point B. Undoubtedly there might be varying purposes, however each of those purposes somewhere deep down would be either directly or indirectly tied to innovation. Further such a heterogeneity of purposes will lead to innovation in areas across product development, product design, business, processes etc.

Once we are done with the 1st of stimulating innovation, next step is to focus on eliminating the barriers of innovation. The two innovation barriers that I have indicated below need not be exhaustive.

  • Psychological barriers – Common misconception that Innovation is BIG and COMPLEX creates a mental barriers among many to innovate
  • Lack of solution thinking – Engineers work in silos and hence they lack the knowledge of how the product is used by end customers.

Let me talk in detail about each of the barriers of innovation in subsequent blogs. Stimulation and elimination are not the only requirements for successful innovation, there is another major ingredient called environment that is conducive to innovation. An environment that encourages employees to focus on innovation in addition to their regular day-to-day tasks and that eliminates fear of failure among employees. We can go ahead and talk about innovation environment in detail, for now let us put aside that topic for a future blog article.