In other words, how do you create successful products or services in the business market?
With the increasing speed of innovations, new technologies and changing customer needs, your products and services are becoming irrelevant at an ever-increasing rate. What was unique last year is no longer so. So that means that as an entrepreneur or innovator, you need to be keen on what your business products or services add value for your customer. And whether that value is still special enough.
What can you do to differentiate yourself as a company?
An organization that is able to keep renewing itself and adding value has an edge over its competition. But what kind of values should you think of? You can, of course, think about price, quality or certain specifications. While these functional aspects are important, subjective and personal considerations also play a big role in business decisions of your clients. Fortunately, research has been done on the values that are important in the business market. This research by Eric Almquist, Jamie Cleghorn and Lori Sherer in cooperation with Bain Company provides an overview of values for building a strong B2B proposition. The 40 value elements are divided into a pyramid with 5 categories.
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Table Stakes: The Basics
At the base of the B2B pyramid we find the “table stakes”. These are the minimum requirements to compete in the market, such as meeting specifications, competitive pricing and ethical business practices. While these aspects are essential, they offer little room for differentiation. If you do not meet these basic requirements, your product will not be considered as an option.
Functional Value: Solving a specific problem for your customer
Functional value elements focus on the practical needs of businesses, such as cost savings, productivity and scalability. This is where most organizations and businesses have their focus. Examples include software that saves time or machines that increase efficiency. Delivering strong functional value can make your product or service attractive. But in a highly competitive market, you also need to look beyond to really make a difference.
Making work easier for your client
Next to the functional elements, we find the value elements that make it easier for an organization to get the job done. This could be, for example, because a product or service helps you do something faster, better or without frustrations. Certain expertise, flexibility or having a cultural fit can also add value. For example, consider the function of a wholesaler, they offer access to many different products if all goes well so a contractor doesn’t have to buy and pick up all the building materials himself from each individual manufacturer. That makes the job a lot easier. Especially in markets where products are increasingly similar, such as business IT infrastructure or a website operator, these elements can make the difference between a one-time order and a long-term customer relationship.
Personal value: provides added value for people
When you sell your products or services to other businesses (B2B), you are still selling to people. Procurers, budget holders, users of your product, IT people. These are all people with personal interests, concerns and ambitions that factor into the purchase of a business product. So it can be very valuable to add individual value for your business customers’ employees as well. For example, think about reducing stress, increasing personal career opportunities or giving people in the company benefits. A great example of a personal benefit with a business product is a frequent flyer program. The company pays for the flights, but then the employees themselves get the points to fly privately with benefits.
Inspiring Value: Bring vision and impact to your client
The top layer of the pyramid contains values that are much more inspirational and impact-oriented. These products are bought by your target audience because they give hope for or contribute to a better future. Or because the target audience believes in the product’s impact. For example, consider buying sustainable coffee for the office or partnering with NGOs like the Ocean Cleanup.
Build a unique, business value proposition
To be successful as a business with your products and services, a strong value proposition is essential. Your product or service cannot excel in everything, but you can become the best in a few areas (and be good enough in the others). So choose a limited number of values you want to be the best at in your market.
Want to know how to optimize your value proposition for the B2B market?
Contact us for strategic advice or play the Value Proposition Game with your team to explore the B2B values for your product or service.
