In our previous discussion, we delved into the noticeable shift in customer sentiment towards placing greater value on their investments. Today, we will explore the implications of this shift in the B2B realm. In the B2B world, customers have transitioned from an emphasis on growth-related value drivers to a laser-like focus on productivity and efficiency. This transformation, particularly pronounced in 2023, presents a unique set of challenges and opportunities for businesses. To succeed in this evolving landscape, it is imperative to realign B2B sales strategies with this emerging customer sentiment.
Customers Prioritize Efficient Growth
Historically, customers were primarily concerned with value drivers associated with growth. This led companies to make significant investments in software solutions geared towards boosting revenue, expanding their workforce extensively, and accelerating existing revenue streams. However, the current business environment has seen customers shifting their attention towards value drivers centered around productivity and efficiency. These encompass the automation of workflows, the streamlining of technology stacks, and the reduction of operational costs.
Tom Siebel, the founder of C3, has identified two distinct customer profiles that have emerged in 2023. The first group anticipates a potential economic downturn and, as a result, is looking to cut costs across the board, including back-office expenses such as IT, sustainability, and research budgets. The second group is more proactive, investing in initiatives that enhance efficiencies and generate cost savings. To succeed, businesses need to cater to both of these customer profiles by demonstrating how their products enable customers to achieve more with fewer resources.
Emphasizing Productivity and Efficiency Value Drivers
While it is still crucial to present a growth-oriented narrative for your product, leading with productivity and efficiency drivers can be more effective in addressing customer pain points. As you navigate the complex decision-making process, articulate how your products deliver the most value for the customer's investment. For instance, if your initial product pitch revolved around identifying new revenue opportunities through data-driven decisions, consider shifting the focus towards how your product uncovers previously overlooked opportunities for efficiency and productivity gains.
Reframing Value Drivers
To succeed in this new customer sentiment, it is crucial to reassess value drivers across your go-to-market strategy. Many companies that have heavily relied on product-led growth may find their products under scrutiny and may need to develop value-driven messaging from the ground up. Sales-led companies might also need to refine messaging to effectively communicate the value their product delivers.
Clearly defining the problems your product solves for customers in the context of current challenges is essential. John Kaplan at Force Management emphasizes the importance of aligning your customer-facing teams with the value your product provides and adapting it to the current economic conditions. Cross-functional alignment is key to delivering a consistent and relevant message to buyers.
How Companies Are Responding to the Shift
Several companies have recognized the need to pivot towards cost efficiencies, productivity, automation, and value delivered against dollars saved in response to changing customer sentiment. Salesforce's Brian Millham highlights a shift away from messaging focused on growth towards cost efficiencies and value delivered against savings. Labster has successfully consolidated its tech stack and leveraged automation tools to lower costs, thereby advancing its approach to customer acquisition and retention. Databricks, on the other hand, has adjusted its message to focus more on the total cost of ownership and cost savings.
Navigating the Era of Consolidation
We find ourselves in the midst of a significant consolidation of investments, where resources are scarce, and customers are keen to maximize the ROI on every dollar spent. In this environment, effectively communicating how your product helps customers achieve more with fewer resources is crucial to weathering the storm. To thrive in this value-driven customer sentiment, companies must adapt their B2B sales strategies, placing a strong emphasis on productivity, efficiency, and cost savings to resonate with today's discerning customers.
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