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Creating Customers – understanding the buyer

Written by: Phil Shipperlee

Article Overview: Part of the process of developing a prospect into a customer is to use some of the time to understand their buying habits and processes. A common mistake made in selling is to focus internally on what you do and how you do it, when the most important thing is to understand what the prospects and customers want you to do. You need to understand how they might behave, how they might re-act to you, and what will matter to them most when selecting a supplier.

Creating Customers – understanding the buyer

Over 50 years ago, Peter Drucker said; "There is only one valid definition of business purpose: to create a customer".

A common mistake made in selling is to focus internally on what you do and how you do it, when the most important thing is to understand what the prospects and customers want you to do. You need to understand how they might behave, how they might re-act to you, and what will matter to them most when selecting a supplier.

Individual and consumer buying bears some similarity to business buying, in that the final decisions will eventually be made by an individual - the decision maker, who will also be influenced by ambition, position in the company and education. The business world however, is a complex place and has a large number of markets and it is inevitable that the companies within these markets will have their own cultural differences in the buying process. In this environment the products and services bought may be complex and expensive and a group of individuals are usually involved in the decision making.

We undertook a research project to look at the way organisations buy and while this topic will be looked at in more detail in a subsequent article on Opportunity Pursuit, it does start to become important when creating customers. The customer creation stage is the ideal time to gather information in preparation for the time when you will get to bid for actual opportunities. There are five main stages in the buying process:

* Stimulus – recognising an issue and triggering the desire or need to buy a solution
* Specify the desired solution
* Search for and select a supplier
* Substantiate the selection
* Sign-off and sanction the decision

The buying process provides a simplified view of a complex business world. Each buying situation is unique and an organisation’s culture will impact on the length of time spent on each stage of the process. It is important for sales people to know which members of the decision making team are most involved at each stage in the buying process.

Every organisation will have its own strategies, policies, procedures, structure and systems which will affect the buying process. The sales person will need to understand what type of organisational structure and culture the buying organisation has.

So, part of the process of developing a prospect into a customer is to use some of the time to understand their buying habits and processes using the above stages as a framework for collecting and organising what you discover. You will find people more open and communicative on many subjects, than they might be when you are actually bidding competitively for a piece of work. For example, at this stage you will be able to find out the way budgets are created and allocated, and how deals are actually signed off, whereas customers are often cagey about this topic at bid time.

Considering the five stages in the buying process, the further down the list the prospect is when you arrive on the scene to bid for the opportunity, the less control you will have and the less chance you will have of winning. If you have created a healthy customer relationship then you can be there at the beginning and in some cases you and your ideas can be the stimulus. If you are the source of the stimulus, you will have a significant lead over your competitors, as you will be helping to shape and define the need.

Tips:

* Understand the power structure of the organisation; centralised or decentralised, authoritarian or empowered, hierarchic or flat, …
* Understand the drivers of the customer’s market; creators or integrators, commercial or social, niche or multi-purpose, …
* Identify the decision making team and their individual roles and drivers

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