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Consumer vs Business Markets

In both business and consumer markets, the individual that will use your product or service is not always the same individual that makes the actual purchasing decision. For instance, a husband may purchase a product that his wife needs, or a parent for a child, or an employer for an employee. In these situations, your responsibility is to satisfy the decision maker(s) by providing them relevant information as to how your product or service can enhance their business or lifestyle.

Generally, when I walk into a jewelry store to purchase a gift for my wife, the sales representative will ask questions about my wife, not about me (until we start talking budget). In business, you need to ask the purchaser about the goals or intentions for the product or service, not about their basic needs. To make them happy, you have to sell the expectation that the individual receiving the purchase will be happy. When the decision maker is not present, you can generate more sales by focusing on expectation rather than the moment.

Business Market Purchases. When marketing to a business, you should concentrate on what is most important to the business which often includes statistics, facts, data, and a return on investment. Within the business market, the purchasing decision is generally made by multiple individuals. Your selling strategy should focus on each of the decision makers by way of the individual who sought out your business. This may include giving everything to the purchaser and letting that individual determine how to disperse the content to the decision maker(s).

Consumer Market Purchases. Consumers regularly make purchases based on factors which include value, availability, and emotional connections. In consumer markets, you will either sell to an individual or a couple. An example of a couple transaction is a husband wanting to purchase a new home. To do so, he would need to get his wife to agree to the decision. Similar to a business market, you need to sell to both but primarily satisfy the decision maker, which you should identify as you work to develop the relationship.

In both business and consumer markets, you can go a long way by getting the individual who contacted you to like you. If they like you and your business, they will fight on your behalf to influence the decision maker.

Sell What Sells

The goal of any campaign is to generate sales. Therefore, the ideal campaign should build trust, influence sales, and generate brand awareness. The trick to selling is to give customers what they want or something better. As a business, you need to focus your marketing campaigns on the services or products which have proven to generate sales. Your business should target and adapt your marketing strategies to highlight what customers want and will purchase, not necessarily what you want to sell. For example, if Product A (the product you least like) sells more than Product B (the product you want to sell), then you need to adjust your business and focus on the product that is generating a profit and sustaining your business.

When I started as a consultant, I worked under the business name Tex Design Studio (TDS) where I worked directly with customers to sell web design, SEO, marketing, and other services which I outsourced to artists and developers. After a few years, I had discovered that my TDS brand was not growing as I would have liked. Customers were calling the business for me, and me only. They were also Googling my name and referring me any not my company to their family and friends. Considering this, I realized I had been trying to push a brand on customers that they did not want. I wanted so badly to grow the company, that I made it difficult for those customers who wanted something entirely different. As I realized this and adjusted to the customers, I stopped pushing TDS and gave the customers the personal brand that they wanted by renaming my consulting agency Elijah Clark and Associates which proved to be much more successful than TDS ever was or could have been.

The customer is the ultimate power broker within any organization. And as the power brokers, they will set your selling price, name (or rename) your business, help you decide which products to sell, and let you know when it’s time to hire or fire employees. Because of the authority in which customers have on the success of your business, you should structure your marketing efforts on identifying and meeting the customer’s individual needs. Those needs must be met within all aspects of your business including price, customer support, and overall value.

Privacy and Ethical Concerns

Ethical considerations within businesses are largely over-looked within marketing management research (Bell & Bryman, 2007). Business ethics research inherently focuses on sensitive and controversial issues (Miyazaki & Taylor, 2008). Consequently, most business ethics research is susceptible to interaction biases (Miyazaki & Taylor, 2008).

There is a growing concern from consumers that their privacy and personal information is being digitized and sold without their permission (Foxman & Kilcoyne, 1993). The concern is that credit cards, billing details, and other private data is bought and sold across the marketing industry between businesses and organizations to use as soliciting tools. Consumers agree that the lack of organizational ethics when collecting the information is morally wrong (Foxman & Kilcoyne, 1993). The debate amongst consumers and businesses is that both parties feel they own the information submitted. Businesses believe that they have the right to use the information any way they choose to help better their organizational goals and to produce better marketing services (Foxman & Kilcoyne, 1993). Additionally, the organizations that purchase the user information feel they own the data because they purchased it.

If the results show that a company is being unethical by confusing or misinforming consumers on how their private information is used, management should work diligently to resolve the confusion by making privacy details clear. In formulating a research-oriented approach that would benefit the practice in regards to the issue presented, I recommend utilizing a qualitative format similar to the constructivist format. I would begin by outlining the problems being addressed and then focus on presenting existing literature regarding the problem and the significance of the study (Creswell, 2009). Next, I would present procedures including a qualitative research strategy for collecting the necessary data. Finally, I would focus on validating my finding using various forms of interview questions, observational forms, timelines, and proposed budgets (Creswell, 2009).

Recommended Readings

Bell, E., & Bryman, A. (2007). The ethics of management research: An exploratory content analysis. British Journal of Management, 18(1), 63–77. doi:10.1111/j.1467-8551.2006.00487.x

Creswell, J. W. (2009). Research design: Qualitative, quantitative, and mixed methods approaches (Laureate Education, Inc., custom ed.). Thousand Oaks, CA: Sage.

Foxman, E. R., & Kilcoyne, P. (1993). Information technology, marketing practice, and consumer privacy: Ethical issues. Journal of Public Policy & Marketing, 12(1), 106-119. doi: 10.1007/s10660-007-9000-y

Miyazaki , A. D., & Taylor, K. A. (2008). Researcher interaction biases and business ethics research: Respondent reactions to researcher characteristics. Journal of Business Ethics, 81(4), 779–795. doi:10.1007/s10551-007-9547-5

Personal Brand Messaging

Branding involves creating, maintaining, and enhancing the awareness of your product or service. In establishing the credibility and awareness of your brand, third-party endorsements have a tremendous effect. Individual branding is different from business branding in that it requires a continued positive attitude and even stronger relationship building. Unlike business branding, which recommends posting a social ad or banner on a webpage, billboard, or in print collateral, personal branding requires networking— and lots of it. Networking can be done via social networks, local group meetings, and events. In addition, during these networking sessions, the individual needs to be likable and must present good character, knowledge, and a pleasant appearance.

Attitudes toward the message of your brand have an impact on the customer’s purchase and behavioral intentions. To promote your brand, you could invest in advertising, which is a more general means of communication for promoting your brand. Marketing-oriented publicity elicits either positive or negative cognitive responses in customers. A positive cognitive response enhances the brand messaging which has an impact on the customer’s purchasing decision. A negative attitude and cognitive response toward brand messaging reduce the likelihood of a customer making a purchase.

A perfect example of marketing based on customer brand attitude and the use of endorsements is the Beats headphone brand. The brand was introduced without a large budget and focused on building credibility through celebrity endorsements and word-of-mouth. As customers accepted the credibility as positive, they spread the word about the product as being a commodity to those interested in owning the popular brand. With the help of social promotions, celebrity credibility, industry targeted publicity, and brand messaging the brand has developed into a multi-billion dollar company.

Be a Partner

Emotional Connection. Customers want to do business with businesses they like. It’s that simple. While we shouldn’t have to emphasize this fact, we sometimes forget that emotions often drive our purchasing decisions, not logic. When sending marketing material to customers, you have to first develop rapport with those customers, or else your marketing will simply become another “to review” item on customers’ lists. Start with a call or a coffee meeting. Find commonalities. Listen to the customer’s challenges. Show them appreciation and gain their trust. Then, send the marketing material with a personal note and a reminder of some shared moment.

Be a Partner. The customer doesn’t always know best – even if they think they do. If you truly want to be a partner (not simply an order taker), you need to understand if what the customer wants will get them the results they need. These are obviously two very different things. As a partner, you need to challenge the customer by letting them know when there are better products or more efficient and effective ways to be productive. This is also how your business can stand out in competitive situations.

In marketing, if the potential customer wants SEO and social media services, and you simply send marketing outlining why you are the best agency for providing SEO and social media, your marketing material will be similar to every other business’s marketing – except for that one agency that considers why the customer believes they need SEO and social media and what actually makes sense for the customer’s goal, budget, and timeline. You can stand out by taking this different approach through questioning your customers’ actual needs and goals which would allow you to offer them the optimal product or service solution for their needs.

Attracting the right customer

Many businesses that I have consulted for boasted about their low prices but hated the fact that customers would only purchase products on discount. Those businesses failed to sell products at a profitable margin and often could not afford other expenses including employees, marketing, and general operating costs. It’s great when your customers love your low prices, but if your customers are the only ones winning, then that is not good for your business.

Most customers – the ones you want – will view your product or service as an investment. They likely will not see your prices as an issue considering they desire other conveniences of your business, which may include your location, quality, reputation, etc. That’s a very different mindset from that of customers who simply want to buy a product at the lowest cost possible. However, it is your responsibility to market your overall value as the focus of your business and not just your prices.

Qualifying The Customer. I’ve seen it often; an employee talks with a potential customer and the customer seems (or acts) interested. After that meeting, the employee is confident about what the customer wants and offers the customer pretty much everything that the company sells, backtracking from pricing individual services to a grand total number.

The problem? The potential customer has never purchased from the business and has no plans to make a purchase until the end of the year. In addition, his budget is way below what the employee proposed. Immediately, the customer disregards the business as an option, both now and when his budget increases by 50% the following year.

Sometimes, a customer will never be the right fit. And sometimes it just isn’t the right time. Don’t ruin your chances by not understanding your customers’ current and future needs – including their financial constraints. In addition to understanding your customers’ objectives and the current state of your marketing outreach, you should also define the following:

  • What are the customer’s goals?
  • What does success for the overall company look like?
  • What is the timeframe for achieving those goals?
  • Are there separate long-term and short-term goals?
  • What specific metrics will define success?
  • What challenge is the customer currently facing?
  • What value does the customer see in the services you provide?

Quality Relationships

A periodic marketing and customer audit are required if you want to enhance the quality of services and products that your business offers to its customers. Delivering top quality services to customers is considered the most effective way to ensure that your business stands out from its competitors. The main ingredients that are involved in a quality relationship between your customer and your business are trust and commitment.

Trust. Trust refers to confidence and security in relationships and should be treated as the biggest investment in building long term relationships. As a result of understanding and addressing your customers’ needs, any doubts of whether or not your business respects them, and is sincere, are relieved and demonstrates that you are a reliable partner. A lack of trust, on the other hand, weakens the relationship, and as a result, the likelihood of uncertainty and disloyalty increases.

Commitment. Commitment is yet another milestone that should be achieved to create a long-term relationship. Commitment can only be attained when there is trust and the two parties share similar values. In a committed relationship, both your business and the customer wants the relationship to last considering the time and energy needed to switch to another business or market toward new customers.

Other attributes that promote a high-quality relationship include the following:

Courtesy. Many times, your customers may not be satisfied with your business or with the product or service that you offer. It is essential that you provide your customers with quality customer service during these times. Delivering positive and courteous responses act as a catalyst in driving customer satisfaction.

Availability. Most customers prefer human responses compared to automated emails or messages. Hence, it is important for your business to be available to customers with queries and needs. Being available also promotes emotional bonding between customers and your business which is beneficial for establishing and building a profitable business.

Responsiveness. Your business should always have prompt, responsive, and experienced employees serving your customers. If a potential customer calls and asks about some critical product feature and your employee fails to properly explain it or is non-responsive, the customer would likely contact a different business who will provide them with the answers to their questions.

Current. Always remain current with, and ahead of, your industry and changes in your market. Strategies, services, and products often advance or deteriorate with time due to competition and the higher cost of innovation. Consequently, your business should remain current and relevant to your customers and potential customers.

Customer Loyalty and Satisfaction

Most businesses believe that a satisfied customer is also a loyal customer. That is not always the case, as your customer can be satisfied and not loyal to your business. Satisfaction is an emotion while loyalty is related to a future action taken by the customer.

Building satisfied and loyal customers require:

  • Keeping customers engaged in the salesprocess
  • Educating customers on why they should choose you over your competition
  • Knowing the unique needs of your customers and satisfying those needs

Not every customer is destined to be a life-long customer— but if you follow the tactics above, both you and your customer will be set up for a happy and productive relationship.

Understanding your customer loyalty level.

  • Satisfied but disloyal customers: A customer can be fully satisfied but may not be loyal due to following reasons:
    • Experimental Customer. These types of customers like to experiment and enjoy the option of diverging in other available businesses in the market.
    • Price Shopper. These customers are happy with your product or service but will only use your service until they are comfortable in duplicating your results at a lower price.
    • Business Growth. These customers may feel that your methods or product and services are outdated, and will go to a different business that markets having and using the latest trends and technology to grow with the customer’s goals.
  • Unsatisfied but loyal customers: The other situation is when the customer is loyal but is unsatisfied. The reasons for this are:
    • Lack of available options: This situation can arise if your business does not offer products or services offered by competitors or when your business offers an inferior service.
    • Emotionally connected: There are some customers who are afraid to change their supplier because of an emotional business attachment or bonding. The customer may feel that it would be best to try and fix an unsatisfied situation rather than start new.

For your business to be successful, it is important for you to gain customer loyalty. While satisfaction may not guarantee loyalty, it is a prerequisite.

Customer Satisfaction

According to a study of 362 marketing agencies, 95% of the agencies believed they placed a priority on the needs of their customers. Additionally, 80% believed they delivered a superior customer experience. While businesses may believe they place a priority on customer services, the same study found that only 8% of customers agreed that these businesses prioritized customer service.[1]

The relationship between businesses and customers are often one-sided. Where businesses may only see customers as numbers, customers want to be seen as individuals. Creating genuine customer experiences are about providing a unique value, surpassing expectations, engaging customers, and remaining honest.

Successful businesses find ways to satisfy and build customer relationships, as they should. Customers are spending their money to partner and invest with your business. They are your brand ambassadors who will promote your business to their friends and family. You should make it a priority to satisfy their needs and concerns. You can help your business get ahead if you can master the art of customer relationships and build loyal followers.

 

[1] “Tuning In to the Voice of Your Customer,” Harvard Management Update, Vol. 10, No. 10, October 2005.

Types of Customers

Customers play a significant role in the success or failure of your business. In fact, the customer is the actual boss in all dealings and responsible for profits generated for your business. The customer is the one who uses the products and services and judges the quality of those products and services. Hence, it’s important for your business to prioritize and retain former customers as well as continually gain new customers to sustain and grow the business. A strategy to gain new customers includes segmenting your current customers into groups which will help determine how to satisfy and attract your desired customer group.

Your segmenting strategy should also take into account:

  • Age group of the customers
  • Geographical location
  • Lifestyle of customers
  • Social status of customers

Targeting the Right Customers

All customers fall within select groups, and it is your responsibility to know which group that is. It is also essential to know if you are reaching your desired targeted group(s). For example, funky designs and loud colors would be a hit among teenagers, whereas middle aged and the elderly would prefer subtle colors and sophisticated designs. Suits and khakis are extremely popular amongst men, whereas females prefer blazers and blouses. Know your target groups and plan accordingly.

Customers are often of the following types:

Loyal Customers. These customers may be less in number but promote higher sales and profit as compared to other customers. These customers are generally satisfied with your product or service and desire consistency and reliability. Loyal customers often require individual attention and rewards that demand quality customer service.

Discount Customers. Discount customers are also frequent visitors but they usually only make purchases when offered discounts on regular products and brands or buy only low-cost products. The greater the discount, the more likely this customer is to purchase.

Impulsive Customers. These customers are difficult to market to as they don’t have any specific item on their purchase list. Handling these customers is a challenge as they don’t look for particular products and are attracted to businesses that have many options to choose from with products and prices on display.

Wandering Customers. These customers are likely to generate the least profit as they are not sure of what they want to purchase or if they want to purchase. Additionally, these customers don’t usually have the finances available to make a purchase but may purchase at a later date dependent on whether they are still interested and have not found a better value elsewhere.

As you can see in the explanations above, loyal and repeat customers are ideal for most businesses. Nonetheless, it is necessary for you to study the behaviors of customers in your chosen demographic before connecting with them as it will help you to identify specific customer needs and respond accordingly. By identifying the behaviors of customers, you can easily create targeted strategies to attract and satisfy their wants and needs.

Innovative Entrepreneurs

The ingredients of an entrepreneur include an appetite for risk and the ability to spot opportunities, and a minimum of red tape and other procedural hurdles (Can startups help turn the tide?, 2012). Hunter (2012) states that the propensity to take financial, family or career risks are often attributed to entrepreneurs. However, while entrepreneurs generally take risk involving business opportunities, innovators are risk takers that continually practice and challenge status quo. Innovators accomplish this by having the ability to successfully connect seemingly unrelated questions, problems, or ideas from different fields (Dyer, Gregersen, & Christensen, 2009). A company must have both entrepreneurs and innovators in order to remain relevant within their industry. While the entrepreneur may know what decisions need to be made, the innovator understands how to make them work for a purpose. Innovation is almost always a total company effort (Why true innovators must behave like entrepreneurs, 2012). A company that does not produce or motivate innovation, will eventually fail to companies that do.

Innovative entrepreneurs are more likely to challenge assumptions. Innovative entrepreneurs have something called creative intelligence, which enables discovery yet differs from other types of intelligence (Dyer, Gregersen, & Christensen, 2009). It is more than the cognitive skill of being right-brained. Innovators engage both sides of the brain as they leverage the five discovery skills to create new ideas.

Entrepreneurship is about being able to discover a business opportunity and innovation is in building the opportunity. Working as a marketing consultant and developer, I have seen hundreds of business startups fail after taking a risk to begin entrepreneurship. They have failed because of their lack in innovation. It’s easy for these entrepreneurs to see the opportunity, but most don’t know how to build it. Hunter (2012) explains it best in that very little innovation is generated by start-up ventures.

Credits

Dyer, J. H., Gregersen, H. B., & Christensen, C. M. (2009). The innovator’s DNA. Harvard Business Review, 87(12), 1–9.

Why true innovators must behave like entrepreneurs [Editorial]. (2012). Marketing Week, 35(31), 10.

Hunter, M. (2012). On some of the misconceptions about entrepreneurship. Economics, Management, and Financial Markets, 7(2), 55–104.

Can startups help turn the tide? (2012). Harvard Business Review, 90(9), 30–31.

The Hill consulting group Group. (2006) Leadership Self Assessment Retrieved from http://www.hillconsultinggroup.org/assets/pdfs/leadership-assessment. pdf

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