I’ve spent the past fifteen years working in companies that sell solutions to improve human capital and sales performance, and now I work as a marketing consultant for numerous companies in the industry. I’ve interviewed hundreds of buyers and I’ve studied how organizations prioritize needs, source providers, and make buying decisions.
Through my own experience and formal research, I’ve outlined my seven most important lessons learned about how companies buy human capital and sales performance solutions over $100k.
1. Major strategic events drive large investments in human capital and sale performance improvement solutions
From my research, about two-thirds of investments over $100K were associated with a major strategic event, such as leadership change, M&A, new product launch, late-stage VC funding, or a major strategic pivot.
As a seller, you need to track these events and then position your capabilities as enablers to help leaders navigate change and achieve the results they expect. Then, you need to identify buying influences and start building awareness and credibility through your outreach and nurturing activity.
2. Economic buyers delegate sourcing activity down to technical buyers—with instructions
Once a sales or business leader decides that it is time to move forward with an initiative, they will usually ask their peers for recommended providers. The economic buyer then delegates the task of sourcing providers down to a technical buyer, but with specific instructions to include providers that they prefer or that their peers recommend.
As a seller, you need to proactively target executive-level buyers to build credibility and awareness, and influence their thinking. If you sit back and wait for inbound leads, then you will be left out of many opportunities. You need to think “all bound,” that is both opportunistic/reactive inbound and strategic/proactive outbound.
3. Technical buyers are very averse to risk and source diligently
Once technical buyers get their marching orders to source, they usually do so very diligently. They do this because, at some point, they will need to justify their preferred choices to their superiors (i.e., the economic buyer). Technical buyers will scour the internet looking for potential providers, peer reviews, and analyst reports. They will often create a matrix to evaluate providers across established criteria.
As a seller, you need to get found and get considered before you can get selected. Realize that buyers are comparing you directly to your competitors and if you don’t show well, they may pass on you. Benchmark yourself against your competitors regularly, and make sure you are making a compelling case to be considered.
4. Buyers search brands as well as problem/solution keywords
When buyers source providers online, they usually start by searching Google. The keywords they enter into Google may be related to their problems (e.g., sales rep attrition), anticipated solutions (e.g., sales compensation consultant), or an actual brand that they believe to do that work (e.g., the Hay Group). Surprisingly, they search branded keywords as frequently as problem/solution keywords.
As a seller, it is critical to build brand awareness, credibility, and awareness with buyers. You should also ensure that your paid search strategy doesn’t overlook branded keywords because they are extremely important. Search engine optimization has become very difficult because there is so much competition, but Google still only returns about ten organic results on its first page.
5. Technical buyers need certain types of information to consider you
When technical buyers land on your website in your sourcing process, they are looking for very specific information to determine if you are a “fit.” They need to see logos, case studies, testimonials product overview summaries, and recorded demos. They need this information to justify their decision to include you as a provider to the high-ups in their organization.
As a seller, you need to provide an effortless buying experience. This means making a powerful first impression, making it easy for buyers to find the information they need, and ensuring that information is highly relevant and compelling to their needs. If the information is too hard to find, they will find someone else and no longer consider you.
6. Free trials are usually a waste of time for buyers of enterprise applications
Free, time-bound trials are usually not very important to buyers, especially when there is considerable effort required to bring a free trial to life in a meaningful way. For example, if they need to expand the effort to configure or integrate the system, populate it with a lot of data, or spend considerable time learning the system, then they will probably pass. They may sign-up for the free trial but probably won’t do much with it.
As a seller, you need to provide the buyer with the resources they need to evaluate your solution and make an informed decision. Freemium models have been known to work in some situations such as project management (e.g., BaseCamp) and storage (e.g., Box.net). Learn from your customers about what they need and watch your competitors determine what they provide.
7. “Fit” matters most in the final decision
When I do win-loss reviews for my clients, I will ask buyers why they ultimately made the decision that they made. The most common reason I hear—over 50% of the time—is “fit.” Through the buying process, one seller really stood out as “getting” the buyer’s business and demonstrating the ability and willingness to partner on a solution that would work for the buyer.
As a seller, your people need to relate closely to the buyer. They must live in the buyer’s world, feel the buyer’s pain, know how to solve the buyer’s problem, and resist the urge to come across as “generic.” This starts online with your positioning and must continue through interactions with your salespeople.
Competing in the crowded and ultra-competitive human capital and sales performance improvement market requires you to know your buyer at a deeper level, and focus on niche markets you can dominate. This is something that I help my clients do. Please call me at (267) 265-7150 or email me at Dario.Priolo@JKResearch.com if I can be of assistance.