One of the most important aspects of selling is to know your customer. Whether it is to high-tech or other business-to-business customers.
It is, therefore, the more surprising to see that there are so many companies that have a ‘step-child treatment’ approach to everything commercial.
Especially in the high-tech industry and manufacturing of complex products and the supply related services.
For this post, I will apply a variation of the famous 1958 McGraw Hill ad I already wrote about in another post about high-tech marketing!
In that post I looked at high-tech marketing and sales from the viewpoint of the customer.
Why would customers buy from you if they don’t know you, your company, your reputation, and more?
In this post, I will turn this around. I will ask similar questions but now from the viewpoint of the supplier.
I will explain what the consequences are for you if you don’t invest in getting to know your customer. And also how your customers buy, what terms and conditions they use and so on. All are important factors in positioning yourself for the next proposal and sale.
Not doing your best to get know your (future) customer and understanding its needs, what it stands for, its reputation and records and more, will dramatically reduce your sales.
You Don’t Know The Customer’s Company
Before you contact a company to market or sell your product, how much time do you really spend on getting to know about the customer’s company?
Do you not first want to really get to know them? What products and services they make? Who owns it, how it is structured?
Especially, in B2B. Even more so when you are selling high-value high-tech products or services, doing your homework and planning to go on your ‘first date’ with a prospect is essential.
But even if it is an existing customer, for each next sale you need to do your research. You may be selling to a different divisions. Or maybe the organisation and processes have changed.
You must find out who the decision makers are and how the decision-making and buying processes look like.
You don’t want to go all the way through the process and waste time and resources. And then find out too late you were talking to the wrong people all the time. Or there was this one important person who influences the buying decision you failed to identify.
If you know who the decision-makers are, you can then create an approach for engaging them.
Talking to the decision-makers you also need to establish the process they’re going through in order to make the buying decision.
You Don’t Know The Customer Needs
This is one of the biggest mistakes and again and again the number one reason for losing tenders, sales and business value in other phases of the contract lifecycle.
Selling the wrong solution or incomplete products and services in combination with weak statements of work will especially hunt you in the execution phase.
You need to listen to, and thoroughly understand your customer, and get the full set of requirements from the start.
You need to establish early on in your sales conversations how serious they are, and how serious the customer is.
If you already read my article about why the customer should buy from you, that will be no issue anymore.
The goals is to better understand the customer’s buying motivation. Also you want to know what the probability is of you getting the deal.
The customer’s timescales are also important.
Most salespeople make the mistake of only finding out at the moment when the clients want to implement the service or when they need to take delivery of the product.
You need to understand their buying cycles to give yourself the best understanding of when and how to handle the proposal.
For any sales opportunity, you must also identify the available budget or funding as early as possible.
You need again to identify all people involved in the buying process.
If you don’t, this can mean you not selling the product or service or getting the project at the last minute after putting lots of time and effort into it.
You Don’t Know What The Customer Stands For
The expression “what the customer stands for” relates to its core values and brand.
These go back to the mission and objectives of your customer.
You have to identify whether your customer’s core value and brand align with your mission and objectives.
Maybe you don’t want to sell your high-tech products and services to a company that has values that totally go against your own values.
Would you like to do business with a company that treats their people and customers poorly?
If your brand stands for high-value state-of-the-art high-tech and excellent customer service, do you want to risk brand erosion by working with a company offering low-service, budget commodities? Even if they have a good reputation, it still may be a bad fit.
I’m not saying you should never do business with companies that don’t share your values, but you have to be careful and invest in understanding where your customer stand to protect your own brand and values.
You Don’t Know Who Your Customer’s Customers Are
Especially in business-to-business and high-tech, manufacturing and similar industries the supply chains are long.
Your products and services are most probably only one element in the supply chain.
A developer of mission equipment for a military helicopter is selling its products and services to an aerospace company designing and producing the end product: the helicopter – which again is sold to the aerospace’s customers – ministries of defense and governments.
So the equipment developer needs to have a clear understanding of the total supply chain and who in the end the end-user will be to understand how its equipment will add value and remain competitive towards multiple other solutions in the same market.
And in other industries this is not much different.
So not only do you have to know who your customer is, you also need to know who your customer’s customers are.
In an ideal situation you partner with your customer and join their development and commercial teams when talking and working with the customer’s customers.
If that’s a step too far you anyway should find out as much as possible about end customers.
Up to getting into contact with them to promote your solutions so that the end customer will tell your customer it wants to work with your solutions.
You Don’t Know Your Customer’s Records
Since you’re working in a high-value capital-intensive environment, financials are extremely important.
You cannot afford to build a product or to configure a service for a company to find out too late that the company doesn’t have enough money, has cash flow issues, or is continuously changing ownership between private equity companies and in a permanent state of cost reductions.
Before entering into a business relationship you need to verify the company’s identity, suitability, and risks involved.
Also here you need to take a closer look at the customer’s customers, agents, consultants, suppliers, vendors or distributors.
Are they for instance anti-bribery compliant, and are actually who they claim to be. If you’re selling high-tech that is also used in defense technology you need to strictly follow regulations.
Installing compliance policies and doing due diligence on your (new) customers and their supply chain is essential and penalties can be very high if you don’t do this.
Financial services and other high-risk industries call it Know-Your-Customer or KYC guidelines.
You Don’t Know Your Customer’s Reputation
Also look at the reputation of your potential customer.
When trying to market or sell your products and services, just ask them about the other options they’re considering.
You will get information about other potential suppliers/vendors.
Then you need to find out wat the company’s reputation is towards suppliers and vendors.
Are they a loyal partner, do they believe in long-term relationships, or do they ‘milk’ you and your knowledge and throw you out after a while when they think fit?
Also in the proposal phase, I have seen many instances where companies invite vendors and consultants is, ask them for prototypes and proofs of concept, getting as much free information they want, and then not continuing the relationship.
Also watch out whether or not you are competing with an incumbent, companies already in and dealing with your customer.
What are other ways for your customer to achieve the results they want?
Also look whether they could be doing it themselves in-house, or not doing it at all.
Finally and very importantly, can you negotiate the terms and conditions of your contract on an equal basis? Or its it take-it-or-leave-it?
Getting to know the reputation of the customer will anyway get you information about the competition, what customers think about the company and whether or not investing time and resources in building a relationship with the company will add business value.
Now – Why Would The Customer Buy From You?
Now if you didn’t put any time and effort in getting to know your customer, it will immediately show in all your communications with this company.
Your proposals will be off-target, your value propositions will not land and so on.
Many customers want to see suppliers on the other side that act as partners in business and really understand their issues, challenges and needs.
If you don’t do that there is no real reason for customers to buy from you.