Every business needs the ability to understand complex and changing customer needs, and the agility to respond to them. But many B2B companies are failing, on both counts.
We can see that when it comes to customer centricity, B2B companies talk a good game. The problem is their inability to put words into action.
This talk must be turned into delivering clear and tangible customer value. By not doing this, B2B companies are letting millions of dollars of untapped opportunity go to waste.
What’s going wrong
B2B companies are failing for three reasons. First, many are relying too heavily on ineffective research. Second, too few are preparing for the future. Finally, they are struggling to put theory into practice.
We asked B2B companies which methods they used to identify changing customer needs and which were effective.
The most popular was the least effective. Gut instinct, used by all respondents to identify changing customer needs, was regarded effective by just 30%. 1
Yet even with more tried and tested methods, success rates were low.
Only 42% of those using customer database research rated it effective and just 32% said the same of their customer research.2
Satisfaction with the value of social media as an insight tool was even lower. Just 9% of those using Twitter and Facebook to gather customer insight rated either effective.3
Ineffective insight breeds indifference. But that’s not the only reason why B2B companies fail. As important as understanding changing customer needs is being able to respond to them. And here too, many fall short.
Almost half of B2Bs in our study – 44% – admitted their marketing department waited for change before evaluating a course of action rather than proactively thinking about change and addressing it before it happens.4
No wonder just 45% of B2B CMOs rated their own business’s customer centricity as ‘good’ or ‘high’ in a recent SAP / CMO Council survey. This rate of failure is marked considering that 90% of CMOs declared it ‘critical’ to business success.5
Fail your customer, fail yourself
The risks are clear.
Many B2Bs are failing to understand their customers. Worse, they are failing to put what understanding they have to good use. And this failure makes it likely they will be replaced.
A staggering 70% of global B2B customers are either indifferent or actively disengaged with their suppliers, according to Gallup.6
Low customer engagement means weak customer loyalty. And this is hardly surprising considering the 86% of buyers that saw little if any real difference between B2B suppliers in a recent Google / CEB poll.7
From hot air to customer value
But all is not lost.
With the right support, B2B companies can turn aspirations around being customer centric into action that delivers real customer value.
The key is to combine superior ability to understand complex and changing customer needs with the agility to keep the whole organisation focused on meeting them.
By unpicking the complexity of B2B decision making, a B2B company can start to cultivate deep and in-depth knowledge of what its customers want. By identifying new ways to create value and commercial return throughout the customer life cycle, it can translate insight into clear opportunities.
Powerful lessons can be learned from successful consumer-facing companies such as Apple, Unilever and Wagamama and leading B2B companies such as HP and Invesco.
Businesses such as these are customer centric to their core, combining deep insight with strategies that deliver value for customer and business alike.
They don’t look solely to serve the functional needs of their customers, they build relationships to understand and connect better with them. And by doing so, they stay ahead as customers wants and needs change.
Tomorrow’s B2B winners will understand complex and changing customer needs and respond to them effectively. With significant business left untapped, B2B companies have much to gain – but only if they can deliver clear and tangible customer value.
1, 2, 3, 4. Clear B2B ‚Cost of Change‘ Study 2014
5. SAP / CMO Council ‚Mastering Adaptive Customer Engagements‘ 2014
6. Gallup 2016
7. Google / CEB ‚From Promotion to Emotion‘ 2013