It is well recognized that consumer buying behavior has gone through a significant change over the past decade, mostly due to the availability of information and the ease of connecting to peers. We have all become hyper-connected, and the result is a new found freedom to control decision making, particularly in what, when, and from whom we purchase stuff. That’s true in the business-to-consumer space, but does this change in individual behavior also impact business-to-business buying behavior?
We often perceive a large difference between B2C and B2B buying, but in reality both activities are carried out by individuals. In the business setting there may be more governance over the process and more people involved, but ultimately someone or some group has to make a purchase decision. More simply, B2B buying behaviors tend to mirror B2C buying behaviors and are experiencing the same types of changes.
So what is different in B2B buying behavior now? Here are a few observations:
• Buyers tend to distrust direct seller information like websites, marketing material, and sales representatives and indirect information that can be easily linked to the seller, such as sponsored content.
• Because of this fundamental distrust and the readily available information from independent online sources, buyers tend to educate themselves and build a deeper understanding of products, particularly in complex purchasing situations like business software.
• The education process tends to happen independently and because there’s a basic desire for trusted information, the seller is often not involved in a buying process until the late stages or after the decision is made. This limits or eliminates the ability of a seller to influence the decision, particularly around competition.
• Buyers apply a series of trust filters to research and the information that they are interested in finding. These will actually influence decisions. Trust filters are a mental model to establish credibility and are applied subconsciously, based on perceptions of the individual, as to the level of trust to assign to any source of information.
B2B Buying Process
The B2B buying process can vary, but there is a basic flow that occurs naturally and appears as a linear process flow, although in reality doesn’t necessarily progress in a linear manner. The process is more of a set of fluid phases, within which buyers move at their own pace and direction toward a decision. Requirement details often vary by company and industry vertical, since everything from internal governance policies to governmental regulations can affect process and outcomes. The buying process is generally made up of four phases:
• Awareness – This is when a company becomes aware of a business issue (or issues) that is causing some disruption or inefficiency in the business.
• Discovery – This is when a company works through the business issues and determines that the solution needs to include some new software and technology that has a specific set of requirements. The solution would also usually include process, people, product, and even business model changes.
• Education – This involves a situation in which requirements are used to guide a process of determining the best potential solution(s). The source of the guidance used to establish the best-fit solution will vary by company and individual, but the information used is trust filtered.
• Decision – This is when collected information sources are used to evaluate solutions and arrive at a purchase decision. The actual process varies by company and ranges from informal to a very structured review and approval approach.
Influence and Influencers
The education phase of the buying process is made up of finding, filtering, and consuming information. Influential information, or information that passes through the buyer’s filter, can consist of anything that the buyer deems relevant, contextual, and trustworthy. Generally, information sources that are used in the business software buying process include traditional media, online media, search engines, experts (analysts, consultants, etc.), peer networks (social networks, professional communities and peer reviews), and vendor-provided resources.
The listed sources could also be filtered by using sponsored and independent as additional criteria and, at least subconsciously, are often applied as a part of the individual’s filter. If you ranked the level of credibility assigned by buyers, independent information is usually ranked higher than sponsored content.
Independent information sources are outside of the control of the seller and put pressure on sellers to influence the influencer. The sharing process from vendor to influencer is important, as it keeps information current and helps prevent mistakes, assuming the information provided is correct (uncolored as much as possible) and the whole sharing process is transparent to buyers. Problems arise when the sharing process isn’t transparent and/or goes beyond accepted ethical practices.
Experts continue to be important to the software selection process. It’s not surprising, since overall business software can be complex and supplied by a broad set of vendors with differing functionality, business models, pricing models, support, and even financial stability. Experts, particularly in the large businesses segment, are an important resource in many of the software categories. Analysts gain trust and become influencers based on individual and firm brand, specific buyer experience and buyer need. They are also prolific generators of content that can be timely, contextual, available, and very useful in the education process.
Peer networks are the newest addition to the relevant information sources available to buyers and are generally public social networks, professional peer communities, or peer review sites. Social networks and professional communities are online versions of the information sharing that naturally happens between colleagues and peers. The peer review sites are different from all the other information sources and offer a unique opportunity to get a transparent view from people who actually use the business software.
Peer review sites are gaining momentum and influence with software buyers. The basic requirements to make the community useful and viable are:
• an online platform that supports the community by collecting and designating information in an orderly fashion;
• some structured method to get new and refreshed reviews in an ongoing basis;
• a method for software end users with direct experience in a specific software to provide unbiased reviews of the product in a structured fashion that includes some form of rating system (As a part of the process there must be a risk management and verification process to prevent any gaming of the system, making the data trusted and credible.);
• an underlying structure to the software products, vendors, and other supporting research that makes the information consumable and easy to find; and
• additional value-add resources to help the buyer find and evaluate the software.
Influence is a key part of the software buying process, providing trust filtered ways for buyers to educate themselves on the available solutions and vendors. This is an accepted way of supporting the B2B software buying process that has existed for decades. The definition of influencer and how they are accessed, though, is changing due to the hyper-connectivity provided by the Internet and its ubiquitous access to relevant information. It’s important for B2B buyers to be educated on the available sources of information and to leverage some of the newer types of sources to build complete pictures of the available solutions to their business problems.
Edited by Maurice Nagle