Customers have access to more information than ever before, and yet when it comes to deciding on solutions for their business, the more information they have, the less able they are to choose. Anthony Roberts, Managing Director of Eclipx Commercial, talks through how you can help them navigate the buying journey.
Recent research in the Harvard Business Review confirmed that, when it comes to consumers, more choice isn’t necessarily a good thing – for them or you. It seems that the more information buyers are presented with, the more questions they have – and the more difficult it becomes for them to understand and compare alternatives with any sense of confidence. The feelings of confusion continue even after settling on a product, as the consumer second-guesses themselves, worrying they haven’t made the right choice.
The internet gives us more choice and information than ever – and yet, only a tiny 2.6% of B2B buyers said they would rather buy wholly online than deal with a seller. This shows that salespeople still play an important role in customer choice and satisfaction. But it is important to note that, as a seller, the later you engage in the sales process, the harder it becomes to differentiate yourself – due in part to the amount of information and choice the customer has already received by that point.
And there is another challenge. Not only are potential buyers reeling from information overload, but the decision to purchase is taking longer. In fact, it will typically take twice as long as buyers expect, with 65% of customers reporting they spent as long just getting ready to speak to the sales representative as they’d initially expected the entire process to take. To add to confusion, more and more people are involved in the process. The same research tells us that the average of 5.4 people two years ago has risen to 6.8, often in different roles and functions, making it very difficult to reach a consensus.
Why the “responsive” framework may no longer work
Most sellers believe that if they focus on a customer-centric approach they will be successful. They think they must take direction from their potential buyer (even if they don’t agree), adjust their offering as buyers’ demands evolve, and satisfy every request for information. The truth, however, is that this approach actually decreases purchase ease, by 18%. In fact, the so-called ‘responsive’ sales approach has a counterintuitive effect: decreasing the ease with which buyers choose and increasing the likelihood of purchase regret.
It feels like it flies in the face of traditional sales techniques, but the reality is that – in a world where there is endless information at a customer’s fingertips – a proactive, prescriptive approach actually increases purchase ease, by up to 86%.
What does this mean for manufacturers?
Your best recourse is giving potential buyers a clear recommendation, backed by a specific rationale. This helps buyers answer questions from their business, and strengthens their perception of you as a supplier that understands their needs and is one step ahead. For example, by offering equipment financing – tailored to your buyer’s industry, equipment and cashflow requirements – you can help them overcome budget restrictions, balance sheet and cashflow concerns, while also giving them a best-in-market option.
It works. According to research we commissioned at Eclipx Commercial, over 90% of small and medium businesses experienced higher sales when they offered equipment finance for their products; 75.5% closed larger deals; and – most importantly – 80% forecasted higher growth than companies that don’t offer financing. A financed sale is also typically more profitable than other sales and helps reduce the cash conversion cycle by up to 59 days – and a shorter cash conversion cycle means a stronger bottom line.
So, with or without financing, how do you take a prescriptive approach to sales? Harvard Business Review identified four clear steps:
- Map the journey your potential buyer will take, from recognising that new equipment is needed, through to choosing a specific model. Use as many sources as possible to track these steps, including asking buyers and your own sales reps for their insights.
- Identify the major barriers your customers face. One of these is likely to be availability of finance, so offering a flexible and competitive solution at an early stage will be a strong advantage.
- Design a prescriptive solution, one that is unbiased and credible, not promotional. Your solution should be aimed at reducing indecision, and compelling action along a path that leads to you and your products.
- Track customer progress. This means having resources committed to tracking your potential customers’ actions and progress.
In a world of information overload, anything a manufacturer can do to make potential buyers feel informed and confident about the act of choosing will provide a competitive advantage. This mean taking a prescriptive approach, rather than a vague or passive approach to buyers’ challenges. Offering asset finance is one way to provide a clearer, easier journey to choice.