Informed buyers and the crisis of tech differentiation

When was the last time you sat in on a webinar and said, 'Man, that was really great!'? Yeah, me too. But I recently had that experience on a replay of Gartner's The sad state of differentiation and what to do about it (free w/registration).

On the webinar, Gartner's Hank Barnes, Research Director, Technology Go-To Market provided hard data about the educated enterprise buyer. Bottom line? Tech (and tech services) companies are struggling mightily to differentiate themselves with today's enterprise buyer. 'We have the best people' has long been a stamp of positioning mediocrity, but what happens when you are eliminated before you can even make the pitch?

To contrast with Gartner's findings. I did a sweep of other recent insights on B2B buyer personas. What I found was a buying sensibility that favors some tech companies but punishes others. Issues are also raised about the value of content in research and evaluation.

Data: why the self-qualified buyer disrupts enterprise sales

Barnes launches the webinar with a Q4 2013 Gartner survey of 359 buyers of technology information and services. The question of how buyers prefer to evaluate and engage tech vendors showed that self-directed search trumped even peer reviews:

Source: Gartner webinar, The sad state of differentiation and what to do about it

No big shockers here - though this level of buyer autonomy disrupts the old fashioned 'saturate the market, corner the prospect and charm/cajole/close them' sales approach (even car dealers are having trouble with that style now). Prospects are also eliminated throughout these cycles, meaning that in the 'explore' phase, you may have been pro-actively eliminated (or completely invisible in search), with limited data clues to trace.

The conclusion? A failure to differentiate early in the buying process is a costlier problem than ever. So how are tech companies doing? Well, according to this particular survey, not so special: 52% of those Gartner surveyed said it was difficult to understand vendor differentiation.

In the cases where tech firms did stand out from their peers, there was an interesting mix of old school and new school characteristics. For this survey, service and support was the clear winner at 67 percent, followed by product features and functionality at 55 percent. Price (48 percent) and quality (44 percent) were also factors.

However, the next two differentiators are two that Barnes called attention to during the session: clear communication of business outcomes (29 percent), and ease of doing business (28 percent). Service and support poses a differentiating danger, however: 80 percent of the respondents who cited tech providers as being ineffective at differientation cited messaging as the biggest problem.

That puts a wrench in things: service and support turns out to be a wet noodle as a messaging theme (it's kind of a tedious variation on 'we have the best consultants'). Instead, you have to demonstrate the culture of service during the sales experience - it's a 'show, don't tell' characteristic. Pushing product features as opposed to business outcomes was another bone of contention with respondents, with 74 percent citing an over-emphasis on product features as a differentiating failure.

Wrapping up the Gartner data, one list of stats threw me. When asked for the top three sources their used to evaluate how IT solutions differ, the respondents said:

References from same-size peers in industry: 60 percent
IT analyst firms: 56 percent
Professional communities: 36 percent
References from same-size peers in region: 25 percent
IT events and conferences: 21 percent
Systems Integrators and value-added resellers: 21 percent
IT vendor’s sales representative(s): 19 percent
Articles in press publications: 17 percent
IT vendor’s websites: 12 percent

Under 10 percent answers included: Provider-centric customer communities (9 percent), Content marketing (5 percent), Digital media (4 percent), Social media (3 percent), and IT vendor advertising (2 percent).

There was a mix of the expected and the head scratchers in this data. Social media's pathetically low score was no surprise, but then I don't rate social media nearly as highly for B2B marketing as some do. One thing that occurred to me: the top seven results all strongly imply a direct personal relationship of some kind. If true, that does not surprise. While you can cultivate the conditions for trust through content, you seal that deal in person. Of the non-personal criteria, it makes sense for (cough!) impartial third party press coverage to finish the highest.

So does content matter to the enterprise buyer, or not?

But what of the small result for content? Doesn't that conflict with my past insistence on an aggressive content strategy?. Perhaps. Before we dismiss content, take another look at the relationship between content and the self-informed buyer. Case in point: a recent piece on Demand Gen Report by Glenn Taylor says:

Russell Kern, President and Founder of KERN, a consultancy, noted that the average buyer will download 10 to 14 pieces of content during the researching, consideration and purchase process, with short video snippets being among the most important content. Providing content that is relevant to a specific point in the sales funnel is an issue many organizations still have trouble with, as reactions depend largely on buyer intentions at the time they receive the content.

Brian Sommer of Techventive also makes a convincing case for content as differentiator. Sommer recommends creating content assets that reinforce 'thought leadership' and provide fodder for substantive marketing campaigns. The competition gets exposed:

When a firm can offer up a team that includes a published subject matter expert, how can some undifferentiated, unoriginal competitor stand a chance? They can’t. Businesses buy people first, teams second and the firm third when it comes to services. You can shout all you want that your firm “hires the best people”, “delivers value”, etc. but that is all noise and comes off undifferentiated to most service buyers.

After bemoaning how few firms produce this kind of content, Sommer jams the point home with a reminder that content also drives search:

What’s brilliant about this is that this is the material that buyers are looking for – no SEO needed here as the high number of hits on this material alone will automatically move this information to the top pages of search engines. Buyers will find your firm as they will be finding your assets more and more frequently.

In a recent piece on The Coming Era of the Self-Qualified B2B Buyer, Tony Zambito argues for a transparent buying process, even exposing prospects to honest reviews:

Where it is appropriate, enable buyers to experience what they normally may at the consumer level. Offer analytics and modeling tools designed to give B2B buyers the power to make an assessment and to see how your organization qualifies. Support with user reviews, the good and the bad. Allowing for an open and transparent reflection of experience.

Verdict

While Gartner's findings are revealing, the modest sample size should be taken into account. But there is near consensus that the typical ways of pushing technology and services are losing effectiveness. Even that old stand by, the monster email campaign, is challenged by the increasingly aggressive filters that allow users to limit messages that don't provide a tangible benefit. Opt-in is no longer a one-time push of a button, it's an ongoing challenge of relevance.

One caveat: incumbents with deep pockets are much tougher to displace than change agents would have us believe (Gartner found at least half of those surveyed take brand reputation heavily into account). Nor are the incumbent connections forged on golf courses ever going to disappear from the buying process. But those realities don't invalidate the changes documented: the informed buyer is here to stay.

Action steps are many, but my top items are:

Build a go-to-market pitch based on business outcomes, reinforced by a disciplined customer case study and advocacy program.
Social media is not irrelevant, but should be the cherry on a rich content strategy grounded insearchable assets.
Hiring social media experts is far less important than hiring digital media experts. Multi-media content production is ideal for creating a storyline that sticks.
Trust is cultivated online but is cemented by personal relationships between trusted experts. 'Always be closing' gives way to 'always be advising.'
Re-jigger the entire sales and marketing process to ensure that the 'prospect experience' lives up to the post-sales 'customer experience.'

During the webinar, Barnes went for the jugular by challenging attendees with some deceptively simple questions: 'Do you provide a better buying experience than the competition?' Do you have the simplest contract to use in the industry? Do you make [your products] really easy to order and configure?' Translating that into a prospect experience is easier said than done. But we can start by asking the right questions.