It's not uncommon to see B2B organizations giving a lot of time and attention towards digitizing their customer acquisition. A crucial link though, is still missing.
While most industries have been seriously exploring how Digitization can benefit them, B2C companies seem to be a bit ahead of the curve. In its paper, Improving the B2B Customer Experience McKinsey says, “B2B customer-experience index ratings significantly lag behind those of retail companies”. It further adds that the benefits of digitizing customer experience processes for B2B (and B2C companies) could be - revenue growth of 10-15% and reduction in cost to serve by 10-20%.
So, it’s not uncommon to see B2B organizations giving a lot of time and attention to Digitization. Especially for customer acquisition processes. A Marketing Automation platform for Digital/Social Marketing. Another for website monitoring. Campaign Management for email and SMS promotions. LMS for Lead Management. CRM for sales force automation and call centre. Anlaytics for cross-sell.
Is something missing?
Let’s look under the hood. B2B customer acquisition involves a complex, lengthy sales process, and includes several (internal and external) teams which collaborate together to acquire a customer. From a pricing perspective, a million-dollar proposal would typically involve – 3-4 internal business units, 7-8 business executives, finance and corporate functions, plus 4-5 OEMs or sub-contractors! First the internal and external providers complete their regimen – multiple iterations to BOM, BOQ, discussions, clarifications, technical approvals and revisions. And before the D-Day of proposal submission the proposal owner needs to get together the entire team including the CXOs for the pricing approval/bid review. Not to mention the usual grind of multiple iterations, version mis-match, missing or non-updated items, follow-ups, etc. Thanks to office productivity suites (especially spreadsheets and emails) there is a sidekick which assist companies in managing this gigantic task.
Would it be better if the proposal owner or the bid manager spent less time chasing people than studying recent pricing/vendor trends? Will the organization benefit if she can calculate the target prices for the OEMs? Instead of checking for basic qualification docs, analysing the sub-cons to decide the best fit. Finding new ways to out-smart the competition than following up with management for approvals. Analysing discounting and winnability factors across business units and territories rather than wasting his effort collecting data. Rather than correcting spreadsheet macros and version errors, spend time determining the winning price. Not just highlight risks but also devise mitigations strategies. Most importantly, provide meaningful analysis that aid pricing decisions and win rates. Without having to worry about laptops crashing, emails getting corrupt, and people changing.
In Its paper, To improve Sales, Pay attention to Pre-sales HBR says “Effective presales can help B2B companies achieve consistent win rates of 40 to 50 percent in new business and 80 to 90 percent in renewals”.
May be its time that the crucial proposal pricing & approval process got a higher priority in your Customer Acquisition Digitization plans.
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