The other day I attended an event where sales coach Mika D. Rubanovitsch @Rubanovitsch was talking about sales, marketing and customer behavior.
His key statement was that the buying behavior of customers is changing way faster than companies’ ability to create desirable offering.
This led me to a thinking process pondering what and why - and how to avoid such.
Who Drives the Offering?
Should we trash what we learnt in business school about strategically developing our offering to the focal point matching our core competency and the needs of our carefully selected customer segment(s)? Hitting the sweet spot produces such a compelling reason to buy that success follows automatically.
I am convinced that customers of today still want to get the best solution to answer their needs. However, the criteria defining ‘best’ varies from person to person and from company to company.
Mass Customizing Answers to Variable Buyer Expectations
Oh, how the times have changed since T-Ford. Product companies are answering to individual customer needs by means of mass customization. In mass customization the actual production of delivered value can be kept to a large extent standard – but packaged so that customer is receiving a tailored product and brand. This modularity is very valid still and the more networked the business is the more important this capability remains.
Mass customization is also successfully used by service businesses. The services may be comprised of several service components and options. Some service businesses offer a simple assortment of tightly packaged services. Some master in offering flexible packages consisting of the exact components valued by each customer.
Pay-per-Use Also Answers to Changing Buying Behavior
All customers have their own perception as to what value they are receiving for their money. Customers also evaluate what is a suitable way to finance the products and services they source.
There is a definite long-term trend showing more value put on availability over ownership. Buyers are ready to pay for using a service instead of investing in an asset. Many industries are moving from product sales to recurring revenue – selling as a service.
Customers also want to match their spending to their income and synchronize the flow of money in and out.
Simple implication of this is a pay-per-use model. For example, customer pays for the amount of used cloud storage space.
Also, financing partners and leasing companies have started to offer pay-per-use financing to match the new buyer behavior. For example, if a customer pays for a forklift based on the usage hours, either the manufacturer creates the capability to charge the usage and finance the forklift, - or alternatively a finance company may offers both the financing and charging capability for the pay-per use model.
Value-based Pricing May Be Growing
Forerunners businesses are already able to offer pay-per-value where company earning is dependent on the real benefits of the customer.
This requires capability to evaluate and measure value - and sell value.
Listening Is Key
On top of a great customizable offering and flexible pricing, measuring and charging capability, the key to keeping the offering competitive is the ability to listen and understand the customers’ true motives and criteria.
When in doubt and your typical proposal somehow seems to bother the customer, ask - and then utilize your flexible customizing capabilities.
Ready for the new buyer expectations? Make sure to develop the capabilities to master the variation for different models of charging your service, to master the inevitable increase in variation in sales and back-office.
Good Sign Solution offers the capabilities for flexible recurring revenue billing, monetization and end-to-end digitalization.
To find out more, download whitepaper The Why and How: Recurring Revenue Business Models: