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One of the most fundamental concepts in economics is that of supply and demand. It has been the prevailing underpinnings for a market-driven economy for well over 250 years. One of the early pioneers of modern economics, Adam Smith who was a Scottish philosopher as well as political economist, put forth theories related to the relationship of price to supply and demand in the seminal work of his life, An Inquiry into the Nature and Causes of the Wealth of Nations which was later abbreviated to The Wealth of Nations. This was first published in 1776 at the beginning of not only the American Revolution but of the Industrial Revolution and is considered to be the foundation of modern economic theory.
Demand is still very much part of the business vocabulary today. Especially in the vernacular of B2B marketing whereby we see many topics related to Creating Demand, Demand Generation, Increasing Demand, and etc. In my previous brief, The Design of Buyer Experience, I noted the monumental shift occurring in our market-driven economy in terms of buyer behavior and buyer strategy and that this shift is ushering in a new era of Buyer Experience Economics for both buyers and sellers alike. This shift underway is creating an economic relationship between demand, experience, and revenue. In essence, this shift is formulating a new Buyer Experience Demand Curve that reflects buyer’s demands for improved experiences:
The implication for organizations today is that to improve revenue growth potential, they must increase the economic value of the buyer experience provided. When organizations increase the value of their provision of buyer experience, this will in turn create demand on the part of buyers to want to engage in fulfilling interactions that helps them to achieve their goals. It will be incumbent upon B2B business leaders to engage their organization in developing a Buyer Experience Innovation Strategy that is designed to meet buyer demands for superior experiences and fulfills buyer goals through innovative buyer interactions.
How well an organization innovates the modeling of buyer interactions to align with the buyer’s experience journey will determine the value buyers place on the overall experience. In the B2B marketplaces, there are six (Buyer Experience) BE Value Levers that buyers will use to calculate an “economic value” for their overall buyer experience:
Expertise: The buyer experiences non-sales pitchy subject matter expertise that informs and is indicative of the organizations commitment to innovation.
Ease of Research: The buyer finds easily accessible research content that advances the knowledge needed to support goals.
Communications: The buyer finds that communications from, to, and with the selling organization is engaging, enriching, and one he or she welcomes openly.
Delivery: The buyer finds the execution of the out of box experience (OOBE) or the implementation delivery experience (IDE) to reinforce the value expected and their brand choice.
Ease of Support: The buyer experiences a level of support, support channels, and support expertise that is well designed and unmatched in their industry.
Socialization: The buyer experiences peer-to-peer opportunities, community engagement, image enhancement, and unencumbered bilateral loyalty.
These six BE Value Levers serve as a guidepost to determine how buyers map value to their buying experience with an organization. McKinsey, in various studies, have reported that 70% of buying experiences are based on how buyers believe they are treated. Today, buyers place an economic value on the buying experience and the treatment received. There is a given assumption that has to be underscored. That is, that products and services are well designed and of high quality. The area of differentiation and the margin of difference becoming that of buyer experience.
In highly engineered and complex products or services often found in B2B markets, there is strong competitive comparability. A focus on buyer experience economics and a purposeful commitment to incorporating a Buyer Experience Innovation Strategy will become an increasing imperative for B2B organizations.
