How change in purchasing in B2B solution sales is affecting to companies in 2020s?
This study discusses B2B sales trends based on a Linkedin State of Sales survey. Linkedin conducts an annual State of Sales survey of its users. Study highlights in particular the needs for transformation in B2B sales processes. The need for transformation is not only related to Covid19 pandemic. The corona pandemic has only further accelerated needs for changes. This paper highlights the key findings of Linkedin’s State of Sales survey in B2B commerce, and considers how B2B solution sales could be developed to better respond to changes in customer buying behavior. Following themes are specifically addressed:
1. Change in B2B buying behavior – how can you respond to change with digitalization?
2. The importance of data in winning sales work – how companies can use data to win more deals?
3. Investing beyond technologies – what are the next steps in sales digitalization?
4. Investments to data and digitalization – how to leverage sales initiatives?
How B2B purchasing transformation can be responded?
Various digital collaboration services like Microsoft Teams, Google Meet and Zoom have become an integral part of our sales work. Solution sales have become much more challenging when you have not been able to meet your customers face to face on the spot and thus ensure your customer’s undivided attention.
However, the tremendous growth in the use of virtual collaboration services and the growing use of new sales technologies in general is just one change in B2B sales. According to a Linkedin State of Sales study, nearly 50% of salespeople are increasingly having difficulties getting customers into direct 1-to-1 conversation.
Again, nearly 50% of sales people also estimate that sales cycles continue to lengthen. This study is also consistent with Gartner’s research, and a general understanding of B2B sales trends.
The difficulty of contacting customers have certainly led to longer sales cycles. This is certainly not the only explanation for the prolongation of sales cycles, but also the increasing complexity of companies’ internal purchasing processes and the growth of the customer’s own information retrieval forcibly slows down the progress of the customer’s purchasing process.
This is a major challenge for sales organizations, but can be eased with digitizing sales processes and customer operations.
Digitalization of Sales – Sales data at the heart of the sales process.
As sales cycles lengthen with more complicated purchasing processes, the quality and management of sales process data becomes even more important. As the throughput of sales cases lengthens, there is a greater chance that business situations will change for both the buying and selling company. The business needs and requirements of the buying company might change, the offering of the selling company is evolving, the product catalogs of the supplier network have been renewed, people have changed, the list could just go on!
The declining ability to reach customers and the change in customers’ purchasing behavior place significant needs for change in companies’ sales processes. Therefore B2B sales processes must be developed to better reflect the transformation in purchasing.
When traditional outbound-type contacting has become more difficult, it is important that the customer has an easy-to-use digital sales channel where the customer can learn about and analyze the selling company’s solutions, delivery terms and other information that affects the acquisition.
Currently, a lot of customer-related information is unstructured in companies behind individual salespersons and customer service personnel. Without well-managed information about the customer and its needs, various changes in the customer relationship come at a cost through lost sales opportunities and a weak customer experience.
Knowledge of the customer’s needs and purchasing behavior can be managed effectively through a digital sales channel. The data contained in the various services of the sales channel provides a unified understanding of the customer, and that data makes it possible to analyze the customer’s process. The data will also enable the company to perform better won-loss analyzes and thus develop the company’s competitiveness. Effective data utilization is one sign of a winning sales organization according to Linkedin’s “State of Sales” Study.
The importance of data in winning sales work
Overall, the importance of data in business has grown tremendously in recent years. Naturally, the importance of data also increases in sales operations. The data needed for B2B sales comes roughly from three different domains:
• customer company (business, communications, organization and related people)
• customer needs (business objectives, plans and solution needs)
• customer purchasing behavior (the purchasing process, its actors, the customer’s procurement instructions and preferences)
Sales need data on customers’ current status and future goals despite whether it is a business or consumer purchasing processes. Based on this data the company can build a suitable sales process as well as an offering that can best meet the needs of customers.
In addition to a digital strategy, sales need their own data strategy. According to Linkedin State of Sales survey, a sales organization with a data strategy makes about 10% more winning bids. In order to succeed in improving the sales results, sales need to better understand the data they receive from the customer, and how it can be utilized in sales work and winning sales.
Charasteristics of winning team
Linkedin State of Sales study says that top-level sales teams utilize more data and use the information generated from this data more deeply than less successful teams.
Of course, data as such and its exploitation alone is not enough. Data-driven sales talent development is also one of the key success factors that emerges in Linkedin’s research as a characteristic of a winning sales team.
Without training and self-development, salesperson will hardly be able to respond to a customer’s changing buying behavior. In this case, information about the customer’s purchasing processes and purchasing behavior helps, because based on the information received, the sales understands how the customer’s purchasing behavior is changing.
In general, investing in knowledge and making effective use of knowledge can tell about a company’s attitude and its success factors, because the company’s operations then emphasize knowledge management and the new business development based on this knowledge. Truly developing companies spend time on training and the creation of new processes.
An interesting finding in the study was the sales estimate of the quality of leads generated by marketing. Better-performing salespeople were more satisfied with the leads generated by marketing than less successful ones. Linkedin State of Sales raised the question of whether better confidence in lead quality is due to the fact that marketing is also more successful in a top organization? Or about the fact that top sales can better convert leads into winning offers, and thus top sales teams see marketing producing leads as higher quality? It is difficult to get the right answer to this.
Investing beyond technologies – what could be the next steps in sales digitalization?
Sales-related digital developments and solutions have been very technology-driven – what should be developed next in sales digitalization?
Sales technologies and data collection are currently heavily focused on operating and managing internal sales processes. CRM tools have focused on the ease of operating sales processes. Different service providers produce high-quality data on basic company-related information such as contacts, their role in the client company, and organizational responsibilities. The new sales tools will also be able to integrate the various services needed by sales into a single channel and source of truth.
Companies also monitor customer activity with a variety of tools that examine customer behavior from different messages and stimuli. In recent years, there have also been analytical services that provide information on the company’s situation and trends based on communications and reports published by the company.
Communication automations have also evolved to be smarter and improved ability to respond to customer interests and information needs.
Companies have also invested in online shopping services and especially in their intelligence. Online e-stores are better able to personalize their offerings, activate the customer to make purchases and strive to ensure customer satisfaction through transparency and smooth communication.
Companies have also invested in customer service processes that aim to serve in a more customer-oriented way as well as a personalized approach.
As you can see, the development has been very technology-focused and focused on various stages of sales separately. The development of sales tools has been based on the improvement of analytics tools, communication tools and intelligent automation.
However, no significant investment has been made in the well-defined information obtained directly from the customer about the customer’s business needs and possible solutions related to them, and therefore the customer’s needs and requirements are not in reality collected directly from the customer. If some companies collect this kind of data from the customer, then the collection of this information is not systematic and is based on a predefined data model.
In order to make these different technologies used in sales to work better at the customer’s service during the purchasing process, the company is required to have a clear understanding of sales goals, sales strategy, and based on them, information needs. Like stated earlier in this paper, according to Linkedin’s State of Sales study, a sales organization with a data strategy makes about 10% more winning bids. A clear strategy will also help the company succeed in sales.
How can a company invest in a genuine understanding of the customer’s needs?
By knowing the customer requirements with greater accuracy, the salesperson is sure to win more trade. The sales must understand their clients’ key business plans and competitive factors of the purchasing organization, the customer’s needs for which the purchase is being made, and the customer’s organization, its people and the procurement process. The better you know your customers, the more likely you are to succeed.
The importance of analyzing a customer’s purchasing behavior is constantly growing, as customers’ purchasing processes evolve over time. The data can be used to better understand the customer’s needs and requirements, purchasing behavior and the situation of the purchasing process. Based on the analysis, it is possible to more accurately assess the situation of customers, make the right kind of sales measures, and lead the customer in the transaction.
The utilization of digital sales channels enables a better study of the customer’s purchasing behavior, and the effectiveness of various measures can be monitored much more accurately. The digital sales channel helps in data collection, structuring and analysis. Without a digital sales channel, information is collected manually to various media, leaving information scattered and incomplete. Obtaining information in such a situation is practically impossible because of the inconvenience and cost involved.
The customer is needed to collect the data. The customer must be able to determine the specific need directly with the supplier. Collecting and verifying the accuracy of the information provided by the customer should be made easy. This is aided by smart tools that easily collect data and document it transparently with customers.
Linkedin State of Sales survey states there is no going back to a time when sales were made more by intuition, and success in the future also requires extensive data about the customer, the customer’s needs, and the customer’s buying behavior. To succeed here, sales need the right tools. The digital sales channel offers both a solution to the customer’s service needs as well as accurate information about the customer for use in sales.
Sales must also increase their ability to process and analyze client information so that sales can integrate the data utilization into their operations and daily sales work. Without the ability to process client data efficiently, sales will face challenges in meeting the competition in B2B business in the 2020s.
Investments in data and digitalization – how to leverage sales initiatives?
According to the Linkedin State of Sales study, top sales organizations operate in the following ways:
- invest in collecting quality sales data
- take advantage of digital sales tools and build a sales process that they monitor.
- use the data for sales analysis, such as in-depth won-loss analysis, to understand where a company’s competitiveness comes from and how the company needs to develop its sales.
- invest in the development and training of sales people.
By investing in these initiatives, salespeople will achieve their goals by at least 125%, according to the Linkedin study.
What are the best investment strategies in B2B solution sales in the 2020s?
In this paper, we have particularly addressed the following themes:
- change in purchasing behavior
- better use of data and technologies
- building trust in the customer relationship
- development of sales processes
These initiatives were raised as key success factors in Linkedin State of Sales -report. According to a study by Linkedin, these factors have been long-term development trends, and the Covid19 pandemic that struck in the spring of 2020 has only accelerated these changes. So this is not a new thing, but a result of a longer period.
Companies, and those who act as buyers of companies, are not immune to new technologies and changes in buying behavior. Millenial business buyers are increasingly wanting a consumer-like service in B2B shopping as well. 50% B2B buyers already belong to this generation and, of course, the number of millennials is growing all the time. Sales can not afford to ignore this change in B2B commerce if they want to succeed in B2B sales in the future as well.
As a macro-level trend, businesses in general are becoming increasingly data-centric, and the same trend is naturally happening in sales as well. The importance of data is growing when it comes to improving the quality of companies’ operations and raising business productivity. Inevitably, data-centricity will also play an increasingly important role in sales processes in the future.
Linkedin State of Sales study states that companies need to invest more in:
- data-driven sales management
- sales technologies that improve customer understanding and customer service
- to a sales team with the ability to manage better with transformation.
What should be the strategy to match the customer’s buying process
It is a cliché to say that the company needs a sales strategy as a starting point. But this is inevitable to create a successful sales process. Sales digitalization must be part of the sales strategy and it should take into account the customer’s purchasing behavior. Digitalization helps to build a sales process that supports the customer’s purchasing process. The sales process must make effective use of customer-related data about the customer’s needs, organization, business as well as purchasing behavior.
On this basis, key investments in the development of sales processes could include at least the following:
- sales have digital tools that can be used to collect and utilize the data needed for sales activities.
- sales genuinely leverages customer-related data to understand customer needs and analyze potential markets.
- sales have a process in line with the sales strategy that responds to the customer’s purchasing process and utilizes customer data productively.
Critical to the implementation of successful sales strategy is the creation of a digital sales strategy. Naturally, the sales strategy as well as the related digital strategy must be based on the customer’s needs. Without a deep enough understanding of customers’ business, solution needs, and purchasing process, sales digitization is likely to fail.
In KlaroCPQ’s view, the company will certainly benefit from the digitalisation of sales in at least the following ways:
- Digital sales services help a company win customer trust and make buying easier.
- With digital services, a company is able to make its customers more satisfied.
- By investing in the digitization of sales, a company creates for itself more capabilities to beat competitors.
Certainly there may be other benefits as well, often the benefits depend on the company itself, its business, business architecture and market situation.
In sales development and digitalization, the company must meet the challenges of B2B sales in the 2020s. As B2B business becomes more and more consumer-oriented, companies must be able to serve customers in a high-quality multi-channel approach. Without digital services, a company will simply not be able to win more deals with the intensifying competition.
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