The prevailing view of B2B buying is that it involves expensive and/or complex products or services, large buying groups and long buying cycles. In fact, many B2B companies get significant revenue from other types of sales. That’s why marketing leaders should identify relevant buying scenarios as part of their 2022 planning.
Most of the research and other literature related to B2B marketing has focused on “high interest” purchases that involve multiple decision makers, complex decision-making processes, and long buying cycles.
For example, in a recent Forrester survey of sellers, 94% of respondents said they sell to buying groups of three or more, and 38% said they sell to groups of ten or more.
In the 2020 B2B Buyer Behavior Study According to the Demand Gen Report, 54% of survey respondents said four to nine people were involved in their purchasing decisions, and 11% reported having buying groups of ten or more people. And in the 2021 edition of the study, 55% of survey respondents said the length of the purchase process had increased substantially or Little compared to the previous year.
But high interest purchases with large buying groups and long buying cycles have never represented all B2B buying. In fact, many inter-company purchases are routine, and the purchase decision is made quickly by a few people, or even by a single person.
In a 2021 survey of 401 “industrial buyers” conducted by Thomas, 53% of respondents said they made purchasing decisions in less than one month, and another 33% said they made purchasing decisions within one to three months.
It’s possible that the big bucks are associated with purchases that don’t fit the high-interest stereotype. In a large survey of commercial buyers conducted by Enquiro several years ago, respondents estimated that 50% of their budget was spent on low-risk purchases made frequently and involving only minimal changes from purchase to purchase.
The truth is that many B2B businesses earn revenue from multiple types of purchases, and different purchase scenarios require different marketing strategies and tactics to achieve maximum success. Therefore, B2B marketing leaders need to identify purchase scenarios relevant to their company and assign revenue to these scenarios as part of their 2022 planning.
Purchase Scenario Elements
A purchase scenario is a description of the purchasing process that includes two main components – the functional features of the process itself, and the factors that describe the context in which the purchasing decision is made. The following chart shows a buy scenario model that I’ve used for several years.
The functional attributes of the purchase process are shown on the right side of the graph. They include the size and composition of the purchasing group, the length of the purchasing process, and the activities of the purchasing group.
The items on the left side of the graph describe the context in which the purchase takes place. The common denominator across all of these factors is that they describe the level of risk that buyers associate with a potential purchase.
As the level of perceived risk increases, buyers will take steps to mitigate the risk, and these steps will largely determine the functional features of the purchase they will use. For example, a purchase used for an expensive product or service, or a purchase that requires a great deal of change in the buyers organization, will typically involve more decision makers, involve more research activities and take longer to complete.
Example of a purchase scenario
One feature of purchasing that often doesn’t get much attention is what I call the ‘Individual Purchasing Group Member Effect’. It is not uncommon to define a purchase scenario where the formal purchasing group includes multiple people, but the purchase is actually primarily driven by one of the group members.
The value of defining this type of purchase scenario is illustrated by one of the case studies in Organic Growth Guide Written by Bernard Jaworsky and Robert Lowery. This case study involved a company that manufactures HVAC equipment and building management systems.
To improve sales growth, the company conducted research to map used purchases of commercial HVAC equipment and building management systems. Among other things, the research identified the steps of the purchase processes and the participants in the purchase decision.
The research found that a typical purchasing process involved multiple “buyers” including building owners, financial executives, facility managers, procurement personnel, and facility engineers. The research also found, however, that the facilities manager was the primary buyer in many of the procurement cases. In these scenarios, the facilities manager led the entire procurement process and made the final purchase recommendation.
Equally important, the research also revealed that many facility managers were mandated to make purchases of up to a specified dollar amount from discretionary operating funds without having to use the entire capital investment review process.
Based on these research results, the company has made several changes to its go-to-market model. It changed its marketing communications strategy to focus on creating better interaction with facility managers, and it modified its product line to enable customers to purchase equipment and services in units, allowing facility managers to make purchases using a simpler purchasing process.
As a result of these changes, the company’s sales growth accelerated significantly in the three years since the changes were implemented.
Top image courtesy of Mark Morgan via Flickr (CC).