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Why Marketing and Sales in B2B is Different

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Executive Summary.
  1. How to focus your marketing and sales efforts
  2. How to move up the value chain

pic_andrewIn B2B, most everyone accepts that approximately 80% of a company’s profits are generated by 20% of its clients. Less well known is that 125% of a company’s profits are generated by 40% of clients! So the remaining 60% are responsible for a negative 25% in profits. Both are startling figures, yet very few companies give client segmentation analysis a second thought. Which are the correct clients to invest in? Most don’t really know and work on gut feel. And yet, it’s quite simple actually.

What is even more startling is new work from the US which indicates the influence of various decision makers and influencers and how poorly vendors understand these. As the table below shows

may2012-table

far too little time and effort is spent with decision makers and far too much with users and influencers. Yet in many instances, especially so with large Capex projects, these users have little if any influence in the final decision as to whom to select. In addition, relationship maps, the peering of various levels in the client and vendor organisation are just about non-existent in most companies.

So if you want to move up the value chain as a vendor, see model below, you will only be able

may2012-model

to succeed in doing so if the ‘C’ level of both organisations have on-going, collaborative and constructive dialogue. It’s at the ‘C’ level that business gets done.

As this is the case, let’s go back to the beginning, do you know which 5 or 10 percent of your client base you should be focusing in on? That’s a key question to answer so that you and your colleagues invest appropriately.


Andrew Clare is Managing Partner of reLiance a business to business relationship marketing practice. I focus on improving client profitability through developing, implementing and measuring sustainable, collaborative business to business relationships.

Cell: +27 83 326 2451, E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it , Web: www.rassa.co.za, LinkedIn: www.linkedin.com/in/andrewclare

 

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