Why serving commodity markets could be a great opportunity to differentiate.
If you work in B2B marketing, chances are you have heard or even uttered the words ‘It’s a commodity market. We’ll never make any money’. Yet in all my years in consumer marketing, I don’t think I’ve heard the ‘c’ word once. Think about it. Grocery store shelves are creaking with products that at the base level are commodities. Take milk, for example. It doesn’t get more basic than that, yet look at all the options – different fat content, source, packaging type, shelf life, flavor. They’ve even figured out how to get milk from an almond.
While there are many differences between B2C and B2B marketing, notwithstanding the size of budgets, there are some things that B2B marketers can learn from their consumer-focused peers.
1. Know your customer
Consumer marketing companies spend millions of dollars each year keeping up with their customers. You may not have a huge research budget, but having a deep understanding of your customers/potential customers is critical if you want to differentiate your offering. It goes beyond knowing what’s important to them. The answer to that is almost always ‘price’. You need to scratch beneath the surface to truly understand their decision-making environment, motivations, experiences and pain points. They may be operating under the constraints of their organization, but the key to identifying and unlocking true value is through understanding your customers as humans versus organizations. This will allow you to develop and communicate offerings that resonate.
2. Think outside the widget
Consumer marketers also remember that there is more than one ‘P’ in the marketing mix. You may be manufacturing widgets, but your customer probably doesn’t think in terms of widgets. They are trying to get a job done and if you are armed with an understanding of their world, their challenges and what they value, you can sell them a solution to their problems instead. So if their job is to keep a production line running, you could, for example, offer ‘guaranteed up-time’ through a maintenance and repair package. If they value speed and convenience, online ordering and expedited shipping may get you ahead of the competition. Concerns over a retiring talent-base could be addressed through instant tech support for less experienced employees etc. etc. There are many levers that you can pull outside of the product itself
3. Sell the value – consistently
Once you understand your value proposition, every customer touch point should support it, consistently. McDonald’s and Starbucks both sell coffee. However, the retail environment in Starbucks probably makes you feel better about blowing $4 on a cup of joe. If you are selling the value of speed and convenience, having someone available to answer the phone promptly is probably a good idea. If you are selling technical superiority, ensure your most knowledgeable staff are in front of customers and arm them with the appropriate skills to identify the needs and sell the value accordingly. As an example, in order to compete in the over-crowded arena of IT services, IBM pulled PhD’s from their R&D team and put them on sales calls, then began to offering PhD brainpower to solve customer problems.
This is clearly not easy, otherwise there would be a lot fewer commodity markets. It takes a different mindset, a lot of confidence and an appetite to invest for long term growth, underpinned by a commitment to executional excellence. However, if you can crack the code, there are almost certainly customers out there, willing to pay premium for a product or service that makes their life easier.
So are you ready to be a Fruit Loop in a world full of Cheerios?