B2B sales is all about logical, dollars and cents analysis of options, right? All selling is emotionally based. It doesn’t matter if it is selling to consumers or to sophisticated business owners and executives. Listen to this episode and I’ll prove this to be true.
Hey everyone, it's Robert Poole, with growing your B2B Small Business Podcast. Have you ever heard someone say, "Well hey, emotions come into play in consumer sales, but in sophisticated B2B sales, it's all about the numbers." I've heard that for many years and it's totally wrong. Let's talk about this misconception.
Do you have a small business that sells to other businesses? If so, you probably know that there are plenty of resources for companies that market to consumers, or companies that sell to large and fortune 500 type companies. But what about the small businesses in the middle who sell to other companies? Where do we go to get answers? How do we grow our company consistently while still keeping our sanity? That's the question. And this podcast is the answer. If you're listening to this podcast, you're part of an elite group of achievers who aren't willing to settle for just a nine to five job. You're one of the heroes in our society, and you should be proud of it. Welcome to the tribe, and welcome home. Hey everyone. I hope you're having a fantastic day today.
In the last episode, we talked about the three major types of objections we find in sales and how we can handle them effectively.
Today, I want to talk about a misconception I've seen over the years in B2B. And that misconception is that sales and B2B is not driven by emotion, and that it's mostly a logical process. People think, well, a buyer of a $30,000 piece of equipment is buying it based upon price and features, compared to the competition. And it's not the same thing as a consumer buying a car, or a widget or whatever. And they're right, in the sense that it's different from consumer B2C sales, but it's also similar in a lot of ways. So before you discount the concept or turn off this episode, at least hear me out on this. Since people like to compare B2B and B2C, let's talk about selling in both of those arenas.
First, let's talk about B2C and how it differs from B2B. This is primarily in who we are selling to, maybe I should take a step back for a second and give you my definition of those terms. But B2C generally means that businesses that sell to consumers and these would be companies, like your grocery store, your local fast food place, the manufacturer of kids' toys, and so on. Basically, anything that their target market is consumers.
B2B, on the other hand, is everything else. That means any business that primarily sells its products or services to other businesses. There's always some crossover between the two types, but we can generalize, and of course, this podcast is tailored to B2B small business owners. The big difference between the two is the type of customers. In B2C, you're dealing with a much different customer than in B2B.
Their motivations for buying are generally different. So marketing to them has to be done differently. In B2C, I think you can make some generalizations when you're looking at their typical attributes. For instance, in most B2C situations, they're buying for themselves, which means they are the decision maker. In the higher end purchase, like a car or a house, you might have two decision makers, like a husband and wife that both need to be marketed to. But beyond that, it's usually just a max of two people. And most of the time, just one. And these types of customers have varying levels of sophistication in evaluating offers. You have the whole range of well-educated and sophisticated, to the less educated and less sophisticated in a certain area. And we're all sophisticated as consumers in different areas. But, for instance, if you don't play golf, you wouldn't be considered a sophisticated buyer for golf clubs. But if you're an avid golfer, you'd definitely be considered a more sophisticated buyer.
So it's not that some people are dummy buyers and others are experts, it's just that we all have more knowledge in some areas than others. It's also easier to pinpoint their main triggering emotions and motivation for buying. With the right marketing messages and sales questions, you can pretty easily get to their root motivation, even just the product itself often gives away some idea of what their interest is.
For example, why does the consumer buy a Mercedes. I mean, I'm not an expert in cars, but it seems to me that the two motivations are ego and wanting some kind of reliable and quality vehicle. If we know that ego and impressing other people and feeling successful, then we know how to position the marketing and sales process to fit that motivation. It's pretty simple and it's fairly obvious. Again, in general, it's lower ticket prices.
Other than maybe a car or a house, most consumer purchases are probably less than $1,000, with maybe some going up to 5,000 but that's usually a small amount of the whole group. And consumers also tend to be heavier social media users and often purchase things online. And we can target them where they are. We don't waste money advertising to the general public with things like general TV ads. Also, most B2C products and services have a short sales cycle.
Oftentimes, it's on the first time they're presented with an offer, even something as expensive as a new car, it can have sort of a one-call close or a one presentation close. And because of the lack of sophistication we talked about, sometimes consumers can be manipulated by unethical salespeople and don't always see the obvious sales strategies being used on them.
And one big difference in B2C, is that consumers are generally purchasing with their own money versus somebody else's money. When you pay out of your personal pocket, versus the corporate pot of money, it makes you evaluate the sale more and with more focus on price. And lastly, the peer group that they take advice from, is typically the same demographic as they are. They look to these other consumers for guidance and validation when making purchasing decisions. And I'm sure there are others, but this is enough to get you a picture to compare to B2B.
B2B purchasing is done by a different group of people. And although there are some similarities, if you treat B2B purchases like consumers, you're going to have trouble. So let's talk about some generalizations for B2B purchasers. First, B2B buyers are sometimes purchasing for themselves if they're owner of a business, but often, they're purchasing on behalf of somebody else.
They are sometimes like a purchasing manager or a higher level executive, that has the ear of the CEO or the owner. They may not be the final decision maker, but often they should be considered a buyer because the actual decision maker is going to respect their opinion, and pretty much sign off on the purchase because the person has asked them to. Unlike the average B2C buyer, in general, B2B buyers are more sophisticated in their decision-making process. Doesn't mean consumers are all dummies, but I mean, some of them are, but B2B buyers tend to know more about the product or services being sold to them, and they'll easily catch someone trying to BS them.
This next one is where people get the idea that B2B buyers are all logical and emotion's not involved in the sale. And when marketing to and selling a B2B decision maker, it's hard to identify their motivation sometimes.
Often their motivations seem to be things like price and features, but this is only the surface. And they'll probably even tell you that this is what they're interested in. However, I think it's important that you dig further and do your research trying to figure out what their true motivations are and design questions to elicit those emotions so you can target those motivations effectively in your marketing and sales. Besides their motivations, the type of marketing and sales text used, have to be tailored to address a more sophisticated audience who gets sold to all the time, and can see through any kind of basic sales technique or manipulation.
Unlike some consumers, B2B buyers are constantly being pitched offers, and they're good at wading through the fluff so to speak. Another way it comes into play in B2B, is that their peer group and therefore the buying emotions come from a different type of peer group.
Their peer group is comprised of other buyers like them. And therefore, more sophisticated. This group judges them on a different criteria and social status. Consumer might be influenced by a peer group of their neighbors and friends, and often trying to impress that group by buying something expensive or cool, that will impress their circle of friends and even their family. This is where they get the validation from, so they're focused on different emotions.
A B2B buyer's influenced by other business people and decision makers like themselves, their group of friends, colleagues, acquaintances, are generally sophisticated buyers who share the same attributes. B2B buyer is influenced heavily by ego, just as much as the consumer, but maybe even more so. And you think it'd be the other way around, with consumers being more influenced by ego, but it's not. In their group, instead of being judged on their personal life, their financial and social status, B2B buyers get judged by their success in business and their association with other successful people in business.
Most often, they're not real concerned about anything in their personal life, just how they are perceived as business people in their success. Because of the increased sophistication, we have to appeal to them differently, often in a professional way. Even if the root emotions are similar to consumer emotions, B2B buyers want to feel like they have a sophisticated experience. And so with a few exceptions, the ticket size of the cost of a product or service in B2B, is generally much higher than your average consumer purchase. And even if it's not higher priced, it might be effectively a bigger sale because of the volume of products you're buying. Of course, the sales cycle is typically longer in B2B, which is again, usually driven by the size of the volume of the product or service being purchased. If you're spending a million dollars, you're going to take your time and explore the opportunity thoroughly, and definitely won't be purchasing on a whim the first time you see an offer.
So these are some of the differences between B2C and B2B, but how are they similar, if at all? I would say that sometimes we tend to forget that the basic sales process is comprised of the same thing for both B2C and B2B. As I've talked about before, I think the sales process can pretty much always be reduced back to the three basic step process of hook, story and close. The hook and the story are both focused on the emotional reasons to buy, and the close is where the logic comes in with a little emotion. As a side note, the close with logic is where you help prevent buyer's remorse. When you see buyers remorse, it's because you haven't helped the buyer justify their emotional purchase with enough logical reasons why they bought.
Some sales people are great at the getting people excited to buy, but they to fail to add this last part, and they keep seeing buyers remorse and wondering why. So let's look at a consumer example of this hook, story, close in action.
Let's say, you take the weight loss industry, which, I looked it up and it's a $78 billion industry. I think I should look into that. There's obviously demand for it. But what would a good hook be for some kind of weight loss solution? Something like, lose weight quickly, without depriving yourself. It's something that gets emotional attention. And then a story, John or Jane was like you, they struggled to lose weight, tried all the diets, but they couldn't do it because it was too painful. And then they found this new way to do it and it enabled them to lose weight and not feel deprived.
Again, this triggers the emotions of frustration and even despair while relating to the character in the story. Basically the consumer is saying to themselves, yeah, that's me. I'm just like them. And then a close might be the concept of, Hey, how much longer are you going to wait to feel better about yourself? And the urgency of the offer goes away in 10 days or whatever. The price goes up at midnight, those types of things. If you look at those three stages, what are the real reasons they're buying? I mean, they want to feel good about themselves. They want to look good to their spouse, children, and those they respect. They want to physically feel better. They want to live longer to enjoy life. They want to avoid constant stress of being overweight. No, they don't buy because of price and they don't buy because of features or benefits.
They don't care about that as long as the result that they're after is what they get. So that's consumers again, but the process is the same with B2B, with just a few tweaks. Let's say, you get an example of maybe selling commercial insurance to business owners.
It seems like it'd be a commodity and basically solely on price, but it isn't. You're usually selling to owners and other high end executives and managers, and these people are professionals and sophisticated, buying things like the businesses we talked about. They're good at making decisions. They understand business and they're not going to fall for basic cheesy sales techniques. I mean, you would think it'd be a different process, but it's not. In fact, a hook, story and close. The hook might be that the commercial insurance industry has changed, due to the recent law changes that drastically affect their coverage and premiums.
If you're unaware of these changes, you're going to make some costly mistakes. That would get the attention of any business owner. And then on to the story, we want to put in their minds a story that they can identify with and relate to. So maybe you tell a story about another business owner who didn't understand these changes that were happening, and they didn't make any changes based upon what was going on and how costly this was to them. And then contrast with another business owner who realized there are implications to the new changes and took action, and she saved her company thousands of dollars. And then finally the close. At this point, we've emotionally sold them. They're excited about it. So now we need to protect ourselves from buyers remorse and give them a reason to act now and pull the trigger, instead of procrastinating.
We want to use urgency like, Hey, premiums are going up starting next month, when the new law takes effect. Or underwriters are changing the criteria, as of X date in the future, or features on policies written before X date will have better features. And you'll lose out on that if you don't act now. Basically anything that entices them to act now and sign.
So if the sales process is the same, what are the main reasons they buy? I mean, these are mainly emotional reasons and emotion in sales is really where the money's made. They're going to tell you that they're basing their decisions on price, features, how you compare to their competitors, but really that's all secondary and logical reasons that only come into play at the closing stage. The real reason, say, buyer, things like, they want to impress their spouse with what a smart investment they made. They want to impress their employees with their success and make a decision to grow the company.
They want to impress their peers again, other business owners. They want to feel intelligent and someone who makes great investments. If they have a boss, they're not the main decision maker, they want to show their boss how valuable their decision making is. They think it'll increase their growth financially, which will make them feel successful. They want to show everyone they care about their employees, that they buy insurance for them. They want to show others that they can afford expensive things, the prestige. And then finally, something like, as simple as it is, they like the sales rep personally. You wouldn't think that would matter in a B2B situation, but it absolutely matters. Notice, out of all these, most of them are really related to ego, which as I said, is more prevalent in B2B than in B2C, which is kind of odd, but it's true.
Looking back at those, so what are the reasons that they don't buy? They don't buy because of price, and they don't buy because of features or benefits. And they don't buy necessarily for just an ROI that'll make more money on paper. Yet these are the same things that most sales people focus on, but they are service motivations, and they don't involve the emotions of the prospects. They have their place in the closing phase, but only to give them justification as to why they already bought. If you open up and focus on these, you'll just be another commodity and it might then compare you with their competitor. It's funny, but people will literally pay more for an inferior product because they have been emotionally moved along during the sales and marketing process, price and features are secondary, which doesn't make any sense until you understand human emotions, that are hardwired into us and we can't help but be influenced by them.
So how do we structure this process, in B2B? Again, the sales process goes like this, and this may sound repetitive from the example we just talked about, but I just want to make sure it's clear. We've got to start with the hook, gear our motivations towards catching their business motivations, like feeling successful. We want to target a group of prospects who all have the same motivations, and we definitely don't want to use price or features upfront, as it sets the wrong focus on things and turns the conversation in the wrong way. You only want to use that to justify the sale and prevent buyer's remorse.
And then, onto the story, tell them a story about how another customer was in the same position they are with the same problems or needs that they have. And then, how that customer got all the emotional reasons that they were looking for, the reasons to buy, and at this point, of course don't bother with the logical, don't throw that in there.
It's only at the next stage, the close, where we want to throw in those logical reasons, the urgency, the offer goes away, the price goes up, the features and the ROI compared to your competitors are so much better, and the scarcity, your competitors are going to take advantage of it and you might get left behind. So that's kind of the basic process. And hopefully I've convinced you that there is emotion in B2B, and it's just as important as selling in B2C. I mean, there are differences between B2B and B2C, but they both have the same sales process. Emotion drives both types of sales, and B2B is just a little harder to find, and we have to dig more. But we also get paid more usually.
So we need to focus on the emotions in B2B and get away from this idea that it's only dollar and cents. I hope this was helpful. Thanks for listening. And I'll talk to you soon. Have an awesome day.
Thanks for listening today. I hope you learned something that you can implement right away. I know your time is valuable and it's really an honor to serve you. Please subscribe and rate this show in your favorite podcast platform and give me your honest feedback. If you're interested in learning more about how to grow your B2B small business, please call my office at Sales Double, which is 866 231 6776. Talk to you soon.