A big change is happening in the world of B2B commerce. Companies that still believe that relationships are the most important thing for a successful business are starting to fall behind. Data shows that they are being overtaken by competitors who have adopted successful techniques from B2C.
Image 1: B2B Digital Potential
The benefits of Artificial Intelligence (AI) technologies are evident at a glance. Already, sales offices of the same companies in America and China applying SalesTech innovations are performing better than those in more conservative Europe. The latter still rely heavily on relationship building.
In the B2C segment, companies are growing by working with data and automating sales scenarios. They no longer do "carpet raids" and run precisely targeted micro-campaigns and reach individuals in a personalized way thanks to detailed segmentation.
B2B companies that apply B2C-inspired SalesTech innovations typically see a quick and direct impact on sales. They gain a competitive advantage and increase market share.
So the question is: why aren't more B2B companies doing this?
We think it's because they still believe in the old status quo that says relationships are the most important thing in B2B business. Therefore, we will break down the following questions in turn:
B2B business is really much more relationship-based.
Another important point is that the purchasing decision in a B2B company is not made by an individual, but by a so-called purchasing centre. It consists of a team of people with hierarchy, roles, limited authority, formal and informal relationships.
The B2B buying process has a similar sequence to B2C:
However, unlike B2C, one cannot completely target the emotional profile and spontaneity of a single decision maker.
That's why B2B sales people use terms such as decision maker, budget owner or influencer to refer to a key person and their environment.
Image 2: For a B2B sales people, it is crucial to find the decision maker
More sophisticated traders draw relationship maps (power maps) manually or with the help of software. They expect to win large and complex contracts by mapping the relationships between the various actors and then influencing them. But this tactic may not lead to success, especially if the purchasing centre is run by a "cold and detached" procurement specialist.
Breaking through the B2B shopping mall barrier is challenging and some practices from B2C can help.
1. Techniques to get the customer's attention in the digital world
2. Bringing the customer to a specific offer
3. Working with the customer in the individual sales phases (lead & pipeline management) driving business activity with special conversion metrics and events that trigger automated workflows (e.g. an abandoned cart in an e-shop followed by a sequence of emails)
Other B2C segments are also adopting a progressive e-commerce approach and applying advanced innovations, such as:
1. Customer data platform Companies centrally collect and process customer interaction data from all communication channels (web, emailing, SMS, chat, etc.) into a so-called customer data platform (CDP).
2. Advanced data usage Companies combine the principles of customer segmentation, customer lifetime value (CLV) and identification of current life stage and sentiment.
3. Omnichannel communication Based on the data collected by the customer data platform and its advanced analysis, it targets effective omnichannel communication (communication through all available channels) and sales activities such as x-sell (cross-sell), up-sell and retention support.
Can business techniques from B2C be used in B2B? Data shows that yes, and the most successful B2B companies have been doing it for a long time.
McKinsey's research among US B2B companies in 2021 showed that B2B customers are willing to spend large sums of money online or remotely (without physically meeting). 77% of respondents said they are willing to spend $50,000 or more (over a million crowns) on a single purchase.
Correspondingly, while in February 2021 B2B marketers identified face-to-face meetings as the most effective sales channel, by November of that year it had already been significantly overtaken by online sales.
Image 3: Source: B2B sales: omnichannel everywhere, every time (McKinsey, 2021)
In another study from 2021, McKinsey compared fast-growing B2B companies with others. The research involved 2,500 companies from around the world. The fast-growing companies had 5% to 10% higher sales and their efficiency was 10% to 20% higher.
One of the areas that determined success was the application of technology. While mainstream companies worked only with CRM, the most successful ones also used advanced sales software.
Although data and online sales are playing an increasingly important role, the salesperson has and will continue to play a major role in the B2B sales process.
It's similar to a doctor. An experienced doctor will evaluate the x-ray and recommend appropriate treatment. There may be software that can also reliably evaluate the X-ray based on artificial intelligence. This is a very useful tool for the doctor, but it will never replace him. It is the doctor who will consider all the other circumstances and make an informed decision on the next course of action.
That's why in B2B, people will primarily do business with people - only AI will help them do that.
With AI, you can extend traditional customer relationship-based CRM systems via APIs with tools such as recommendation engines or AI augmentation of human intelligence.
An example of software that enables this combination and helps traders achieve better results through AI is OmniCrane.
It makes it easier for sales people by assigning a Priority Index (PX) and Contact Index (CX) to individual leads based on artificial intelligence and machine learning.
How the Priority Index (PX) works The priority index tells you how far along a potential customer is in the sales process. This allows you to see who is the most prospective and target them.
The value of the Priority Index is influenced by the customer's response to the omnichannel campaign. This is most often in the form of an email and the index is influenced by metrics such as delivery, email open and, most importantly, link click. The application then ranks the leads according to the Priority Index, which serves as the initial filter.
Then comes the salesperson. He looks at which contacts the software has marked as ready for sale and evaluates them based on personal knowledge. For example, he knows that a particular customer, although active in seeking information, will not buy anything now because he has no funds, and elsewhere it is just the opposite.
He's left with a list of leads that make sense to convert into opportunities. From OmniCrane, he moves them into CRM and adds the necessary documents according to company practices, such as a quote, and a proposal.
How Contact Index (CX) works Based on OmniCrane's unique ethical algorithm, it determines the Contact Index. This is based on deep insight into customer behaviour and decision-making. The Contact Index allows the salesperson to reach relevant customers and create personalized offers for them.
In awarding this index, OmniCrane draws on the overall communication and trading history with the customer in question as well as the personal knowledge of the salesperson. It is also influenced by PX, i.e. the actual response to the most recent digital sales campaign.
You can think of OmniCrane as a perfectly configured machine that handles a traditional business agenda. It allows you to:
For more information, see the detailed description of OmniCrane functions.
Image 4: This is what a lead card looks like in OmniCrane
While many B2B traders' sales are stagnant, others are more successful than ever.
About the author:
Richard A. Novák is an expert in ethical AI, digitalization and IT management. He graduated from the Czech Technical University in Prague and received his Ph.D. in Big Data Ethics from the Faculty of Informatics and Statistics at the University of Economics in Prague. He founded the Prague Data Ethics Lab with his colleagues and teaches courses related to Ethical AI and IT Governance at the VŠE. He founded and currently serves as CEO of Omnicrane, a startup focused on applying AI to SalesTech and MarTech. Previously, he held the position of Vice President at telecommunications companies T-Mobile Czech Republic, GTS Czech and Director of IT Services at Slovak Telekom.