This post is in reaction to an interesting blog from @econsultancy. If you read through it, though I don’t advocate the notion of attacking a competitor, you’ll likely find it common sense. But the thing about common sense is that its often rare in practice. How often do we really consider how our customers feel emotionally about their problems or our products in the B2B environment?
It seems to me we, as marketers, spend way too much time articulating features / benefits and not necessarily about what drives customers emotionally. Some key emotions that come to mind relevant to B2B –
1) Security and peace of mind
2) Fear of complexity (and a need for simplicity)
3) Fear of obsolescence
4) Disdain for the big, evil OEM or corporation (that could even be you)
5) Need to be top dog or seen as a thought leader (not necessarily as an organization but as an individual)
6) Fear of unpredictability, inconsistency or failure (not at the product level but as a team or organization)
7) Desire to be perceived as charitable or benevolent
Obviously not every customer in your world is going to share all (or even one) of these emotional needs (that’s where the segmentation comes in). But when it’s all said and done, hard as we try, people are irrational decision makers.
How often have you tried to rationalize a purchase that in your head you knew was irrational? We see it all the time in the consumer world – products and services become emotional extensions of ourselves and we rationalize in our heads why we need something that we really don’t. I refuse to believe the same can’t be said in B2B. Buyers are still people, and people are still irrational. There are just different emotions at play.
In my current role we are commercializing a new solution playing to some extent on #s 4, 5 and 6 from above. That said, we’re still in the early phases so I won’t try and convince you of my genius…yet. In the meantime I would love to hear about what others have seen or done to tackle emotional needs in B2B. I’m all ears, so what have you got?
A few weeks ago I was in Chicago wandering through the water tower shopping plaza with my family. Foot traffic was light to moderate with the exception of two stores.
The Lego Store – Looking beyond the life-sized Darth Vader, the store was standing room only. At the pinnacle of co-branding from Starwars to Cars to Toy Story, there is no end in sight to Lego’s product evolution. All the while you could argue the fundamental product hasn’t changed or evolved since inception. More importantly people love it. My kid loves Starwars and he loves Legos (I know, apple…tree). Together, they’re a co-branding force (no pun intended).
The American Girl – I’ll admit I’d never heard of this brand until a few weeks ago. But just about every little girl below the age of 10 was carrying around an American Girl doll. I didn’t think much of it until my wife pointed out The American Girl’s store front. In it was a packed floor of girls and their moms. Of course the dads were all huddled to the side staring into their smartphones, no doubt reading ESPN to compensate for a general lack of testosterone… but you get the picture.
Now I’m not sure how much market research these organizations invested in (I’m sure they did enough) but clearly these two companies have their target audience hanging on every word. More importantly, whether or not they did any market research is completely irrelevant. My point is that these concepts just make sense. And sometimes that’s all it takes; finding whatever it is that excites us as a user. Case in point the movie clip below, from one of my favorite movies growing up…
Walking through through both of the stores mentioned above, I was reminded of this scene from the movie “Big”. It serves as an important reminder not to get caught up in nailing down all the facts and figures. Forget for a moment the conjoint. Forget the exact market size.
Does the idea make sense?
Clearly, the idea of a Transformers skyscraper made little sense what-so-ever. But, two of the coolest innovations of all time, Legos and Starwars make perfect sense. Dare I say like chocolate and peanut butter. And while I’m not exactly the most female savvy consumer, a customize-able doll that little girls can carry around and build as a reflection of themselves, something they can actually create – that too, makes sense.
I’ll end with this thought. We all (myself included) need to do a better job of embracing our inner child. Embrace that impulse to just run out and do something if it makes sense; to let ourselves get excited about an idea, not about a market size; to get passionate about creating something, not selling something. You just may find yourself on the verge of something big.
In classical mythology, the concept of hubris is often illustrated by the story of Icarus. The son of the master craftsman Daedelus, Icarus let his pride overpower his humility and paid dearly for his mistake. Wikipedia says it best:
Before they took off from the island, Daedalus warned his son not to fly too close to the sun, nor too close to the sea. Overcome by the giddiness that flying lent him, Icarus soared through the sky curiously, but in the process he came too close to the sun, which melted the wax. Icarus kept flapping his wings but soon realized that he had no feathers left and that he was only flapping his bare arms.
How many times have you been in a meeting where the topic of competitive threats come up? And how many times are those threats answered by assertions of “Maybe, but we’re better!” Better technologically, better in some specific attribute, or just downright better overall. Whether or not the customers believe you (and one only look to the sales and market share numbers to quickly learn the answer to that question), some people will forever hold on to the idea that being better is enough.
This morning Dave Winer posted on Google+ and an incumbent’s ability to innovate against the status quo. It’s an interesting piece, especially when he argues that the incumbents become too enamoured with the status quo (aka “Why would we leave money on the table?” syndrome), while anyone they could bring in to shake up the status quo would probably fall prey to office politics. I’m not sure how much I agree with those conclusions, but they are interesting food for thought.
The larger question here is whether it’s possible to get out of your own way long enough to attack the big issues head on. While it might be true that your product is technically superior to the competition’s, if the customer is buying the competition’s products, you’ve got a problem in desperate need of solving (viz: Kris’ piece on Being Good Enough).
If you’ve got yourself convinced that you’re infallible, impervious, or otherwise untouchable, you might spend some time thinking about what happened to IBM, Microsoft, and DEC, or what’s currently happening to Nokia and RIM, or will no doubt ultimately happen to Google, Facebook, and even my beloved Apple, when a young, small, agile upstart comes along and puts a technically superior product out of business.
Many times I’ve heard marketers say something like “You have to give something to get something.” And many times, the person means “[The customer] needs to give [their personal information] to get [my content].” As a marketer I can see the logic, especially when it comes to targeting, measuring, and tracking. But as a consumer, it’s not always clear to me that what I’m getting is as valuable as what they’re giving.
There’s a great article from HBR [N.B. requires purchase and/or login] that talks about the gap between sellers’ and buyers’ perceptions. According to the article, sellers overvalue their wares by up to a factor of 3x, while buyers undervalue those same wares by up to 3x, resulting in a nearly 10x gap between what the seller thinks their thing is worth and what the buyer is willing to “pay” for it.
Put it another way: how many of us have clicked a link or gone to a website only to be immediately challenged to “log in or register to see that content”? Before you are even able to evaluate whether the information is good and valuable and credible you have to give up your personal information, sometimes including your street address and employer’s name. It might not seem like that big of a deal, but given the recent rash of security breaches around the internet (viz: Citibank, Gawker Media, Sony, et al), it should make you wonder exactly how secure your information is, what is the risk of that information being leaked to the rest of the internet, and what happens to you if it does get leaked. Only then will you start putting your information in the right context to decide whether giving it up is the right thing to do.
As a vendor, you have to ask yourself whether that White Paper is telling the customer something they can find in any first year MBA textbook, whether that blog post titled “37 Ways to Supercharge Your Marketing Plan” is really all that insightful, or whether the news you’re hiding behind a paywall is something the customer can freely find somewhere else (see also: the Disney Corporation).
Good marketing is not about targeting, or measuring, or tracking; good marketing is about getting inside the customer’s head and offering something that they really find valuable. Not something that’s inside the 10x margin, not something that’s slighly less crummy than the competition, not something that was easy for you to get done and approved, but something that helps the customer solve a problem that’s big enough to matter and let them do it without a bunch of “exciting (upsell) opportunities” standing in their way. Only then can you really become the “trusted advisor” that is the holy grail of customer-marketing relationships.
UPDATED 12:01, Monday June 27, 2011:
According to Silicon Alley Insider, the executives who were let go will be receiving some/most of the equity compensation in question. While it’s still difficult to know exactly what’s going on or the motives behind it, it’s still a good illustration how bad publicity and the appearance of impropriety can travel very quickly. I still think what I wrote below applies: the changing tide of compensation, and how it’s perceived in the market, could severely stifle innovation in this country, at least as much as any tax, levy, or tariff.
A few weeks ago news broke of Microsoft’s purchase of internet VOIP/VidOIP service Skype. At the time I wrote about what the strategic play might be for Microsoft, what they might consider doing with the service, and how I’d like to see it incorporated into my work digital lifestyle. Now, a few weeks later, news about Skype is again breaking acrosss the interwebs, but this time it paints the service – and specifically it’s management team and a key investor – in a much different light.
Sunday morning Michael Arrington wrote on TechCrunch about stories of Skpe employees being terminated and their stock options being reclaimed by the company (he uses the word “worthless” in the title). Rob Beschizza at Boing Boing had similar thoughts on the matter (he invoked the word “screwed” in his title). Over on AVC.com, Fred Wilson had slightly more tempered thoughts on the matter but does recommend the entire system be rethought.
The intricacies of employee stock options in general and these stock options in particular aside, there’s a larger issue that Skype and Microsoft need to consider. Whether or not it’s true, it appears as if Skype terminated a bunch of people just before a big payday and then took away one of the major incentives that convinced the person to work at Skype in the first place. What’s more, they did it in a way that has been called disingenuous and perhaps even actionable.
At some point, the current Skype management team is going to want to start another company, and they’re going to have this reputation to overcome. Their other investors are going to want to invest in another technology company, an organization who’s employees might flee the moment the deal is announced. Ninety nine times out of 100, acquisitions and investments are for the people, not the technology.
We talk alot about the impact of taxes, tarrifs, levies, and other monetary vehicles on innovation and advancement. But what of the impact of this type of behavior on technological innovation? Silicon Valley, one of the major hotbeds on American innovation, has long depended on the promise of equity compensation in lieu of cash. If employees no longer trust equity compensation, start-ups and small businesses might be forced to switch to more traditional cash-based compensation, which could severely limit their ability to bring enough people on staff to get things done as quickly as necessary, thereby stifiling technology innovation.
The people that really have to be carefule here are Microsoft. If Skype’s people start to view their options as completely worthless, then there becomes very little incentive for them to stay. Since the talent should be at least as much of a concern as the technology in any acquisition, Microsoft could find themselves holding a shell of a company worth much less than the $8.5B they paid for it.