Product Experts Gain New Clout Among B2B Buyers

[MUSIC] Hi, I'm Nick Wells, your host for the What It Means podcast, where we asked for aster analysts for their take on the latest business and technology headlines. While the podcast is currently on a hiatus, we're revisiting some of the most popular episodes from our archive. Conversations that continue to resonate. This is a classic episode that feels even more relevant today. As B2B leaders prepare for the Forrester B2B Summit, its focus on expertise and credibility speaks directly to how trust is earned in today's buying environment. Vice President and Research Director Amy Hayes discusses this and other findings. I hope you enjoy the episode. So before we get into the details of this year's survey, I think it would be helpful to just explain how do we track B2B buyer behavior and how long have we been doing this for just so folks get a sense of where we're at today. Yeah, so we have been studying business buying behavior for the better part of 10 years and publishing various reports on the matter. It was only last year that we determined and we actually increased the number of respondents that we spoke with around the world and we have made the decision to actually publish our findings on an annual basis. So we now have a set of reports that are either looking at a specific buyer persona or a region or an industry for a total of about 24 unique buyer insight reports that we are now publishing on an annual basis. And this year I'm so happy to report that we have over 18,000 respondents from around the world and they are represented across North America, Europe, and Asia Pacific. And they really represent organizations across a wide variety of revenue bands. I would say that from 50 million all the way to 2 billion or more, because we really wanted to get a good understanding of how business buying behavior looks depending on the size of the organization depending on where they are in the world. And we also wanted to understand the differences between sea level buyers and professional level buyers. So we have a really good amount. I think it's about 36% of our respondents were sea suite officers or the equivalent in our in our responded pools. So we have a great cross section of business buyers around the world that we're looking at. This is amazing data. I mean clearly the the reach and the depth of this data is huge. This year especially or I would say probably the last couple years it's it's been a challenge for B2B companies. You know things are tough. Buyers are complex getting even more complex and you know one of the key findings in our state of business buying research was that financial constraints are really stretching and prolonging the buying process. So can we talk a little bit about you know what are we seeing there? You know how is that becoming such an important factor in the in the buying process? Yeah absolutely. This was probably one of the most significant insights that we gleaned from this year's data. And when you think about all of the different macroeconomic factors that are at play whether it is inflation whether it is talent shortages whether it is you know other types of factors that are putting these new or additional forces on buyers to that affects the way that they buy. And so for example when when we asked what if anything stalled your purchase decision 89% of buyers indicated that they were stalled for one reason or another. And that is that is higher than it has been in previous years. I believe last year was about 83%. So this is definitely something that that these macroeconomic forces are definitely having a role and having an impact on how buyers are how quickly buyers are able to make their purchase decisions. And is there any indication of you know when they're going into a buying decision like what are some of the early things that they're looking at part of that process? What the data shows is that the top two reasons for the stall in purchase decisions by business buyers is one their budgets and two the price. So it's this gap between what buyers are able to pay and the price of the offering that vendors have to charge. It's this gap that's creating a significant delay in terms of of how those purchase decisions are being made. There are other factors of course that that are that come into come into play when it comes to purchase stalls. Certainly the effects of the pandemic are continuing to play a role. The shift the sort of macroeconomic or macro market shifts in specific markets are also having an impact. So there's just a lot of different reasons but the top two certainly is this gap between budgets and the price of the offering that's what's causing the majority of the stalls that we see today. One of the really interesting things that you surface in last year's survey data was this sort of emerging or I'm not sure if you would define it as emerging but just the differences in generation you know buyers of different generations I guess is a better way to say it. And so what those dynamics are how does that show up in a buying process? The length of those buying process these reasons to you know why they're stalled in in their buying processes. So just wondering Amy how did that show up this year? Any differences? Any more you know acute nuances that that you saw in the data particularly how prevalent millennial and Gen Z buyers have become? Yes this is such an interesting aspect of the data that that we analyzed and last year over 60% of buyers came from those younger generations so from those millennials and generation Z. And so we've reached this inflection point where that number is now just only going to increase. They're gaining more influence, more authority in the buying decision process and they're just participating in more buying decisions than ever before. So that number increased from 64% last year to 71% this year. That 71 almost three quarters of business buyers are from these younger generations and they have very distinct preferences and behaviors when you compare those to their older core their older cohort the the Gen X and the baby boomers. And so when you look at for instance the stall reasons that we talked about just a minute ago there are significant differences in what stalls younger buyers and what stalls older buyers. And so where those the biggest gaps are is younger buyers are much more likely to be stall due to major shifts in the marketplace. The effect of external influencers into the buying decision process and the effects of COVID-19. So that kind of plays into that first one of sort of the market forces that are at play. But what was the most surprising I think to us is their their inability to build consensus within their own buying group to make a decision. And to us this was an important insight in that younger buyers don't have the same level of experience that older buyers do to in terms of removing barriers that might exist inside the organization to help them make those purchase decisions whether it's you know a financial negotiation whether it's you know different needs that different departments might have that you know they're expecting from that particular purchase. So that that consensus building is not just about which vendor that they want to choose. But it's about the overall purchase itself. Should we even move forward with buying this particular solution? Do we even think that we have a problem to solve? Like these are some of the fundamental challenges that younger buyers are facing in trying to influence and have a greater purchase authority in the buying groups that they participate in. Clearly there's you know there's there are more younger buyers out there but they are struggling to build that internal consensus. What should they be doing or what what are the sources they should be relying on to help them build consensus? Yes so what what providers could be doing what sales and marketing professionals could be doing to better support those younger buyers when they do face those kinds of challenges or obstacles is having readily made readily created assets that help them build the case or make the case for a particular purchase. And really understanding what are the questions that those other members of the buying group have that might not, that are not being addressed or that might not be, that are not getting answered adequately to make it a clear choice to move forward with this particular purchase or this particular vendor. So the more that we can get inside the minds of our buyers and not just our primary decision maker or our champion, but understanding the different roles that are in that buying group. So maybe it's a ratifier, maybe it's somebody from finance that is like really stepping in and saying that this is, you know, not, you know, this is outside of our scope, this is not something that we want to prioritize for this year. What are ways in which we can better enable and understand what those questions are to get ahead of them and be able to have our, our buyer facing teams prepared with those kinds of responses so that our champion is able to help facilitate those conversations more effectively internally. So it really requires an understanding of the different people that are involved in that buying decision process. And they can be users of the product or of the offering that have an outsized influence on the purchase decision. It might be an influencer in another part of the organization that has stake that it could this purchase or this technology implementation might have a significant impact on their operations. So they're going to maybe put up a roadblock. So it's really getting into the minds and understanding the questions of each of the individual buyers that are part of that buying group because we know that business purchases are very seldom made by individuals alone. They are made by groups of people. So maybe we can talk a little bit more about, you know, how much influence does the vendor have in the buying process, right? We're sort of spitballing here like, hey, make sure you understand the buying group and the roles within the buying group. But there's, you know, purchases don't happen in isolation. There are other sort of influences or sources of information that buyers can rely on. So we've talked about that, the importance of third party information sources previously. So what's going on in that arena and what's changed? Yeah, so when we looked at the information sources, so where buyers go to get information to support them through their buying decision process, there is a new leading source of information that is the first time that's kind of reached the top of the list. And those are the product experts from the providers themselves. This was a surprising insight for us that that was such an important valuable, meaningful interaction type that buyers expressed this year. And our hypothesis is that these product experts are able to help buyers effectively cut through the noise to find the information that is most specific to their unique circumstances or their unique problem. They're able to effectively connect what how this, you know, how this offering addresses the specific needs that the buyer has. What are the outcomes that the buyer is trying to achieve? Whether that is for their department, whether that's for their organization, it's really those product experts are able to make that translation more effectively than some of the other information sources that we looked at. The second thing that we noted is buyers still prefer a near equal blend of personal interactions, so conversations with other humans and self guided or self directed interactions where they are doing their own research. There is a, I think, a commonly held belief that buyers are doing more self guided or self directed research than they are talking with other people through the buying process and our data is just not showing that. Now, you know, with that said, this information is is never sort of a blanket statement. This is information that needs to be paired with data that you have or data that that you know about your own buyers and to see how much of this these trends that we that we're seeing at a global level apply to your own set of buyers. Maybe it's not maybe you are seeing different combinations of information sources than we see when we're looking globally. But it's important to know you have to be looking at this kind of this kind of data within your organization to know how much you should be programming the campaigns that you're putting out into the world, how much of those should be self guided, how much of those interaction points should be delivered through other people. And I think this is key because to your point earlier, there is a lot of assumption in the growth of the self guided interaction. And I think, you know, this is a moment where we want to bust some of those assumptions as well. And the product expert piece is super interesting that we actually have a prediction on that as well, right, where we are talking about how, you know, to order five millennial buyers will want access to these product experts sooner in the buying process. So, you know, clearly these two are some of the unique aspects of, you know, what we're seeing sounds like in the in the new research. Absolutely, absolutely. And kind of going along the lines of getting to the core of how a particular offering is going to solve a buyer problem. The second most prevalent or most meaningful interaction point were free trials. So not only are they looking for product experts to to provide meaning about how this offering solves a problem, but they want to actually see it in action. They want to experience it for themselves through something like a free trial. And so those are two really insightful information sources that show that they are looking for really practical types of information in this year's survey results. Now rounding out the rest of sort of their top preferences sales reps are absolutely important. So it's not it's not that product experts and free trials have replaced sales representatives. They are absolutely meaningful and will remain an important part of the buying decision process for buyers. But we need to make sure that we are not only enabling our sellers, but that we are enabling these other people that are getting involved in the buying decision process. So product experts certainly, but also customer service and success representatives are also very, very valuable. And if you think about an existing customer, their doorway, their window into your organization are those customer service and success representatives. And when they are in a position to make another buying decision, maybe it's to renew their current offering or maybe it's to, you know, upsell to, you know, to a new offering on top of it. Those customer service and success reps are absolutely essential to create that experience for buyers when customers become buyers again. And so that's they're so critical and oftentimes that we see B2B organizations just oftentimes ignore the customer service organization when it comes to enablement. And they absolutely need to be an important part of the enablement strategy for B2B organizations. So Amy, we talked previously about how younger buyers are struggling to, you know, build that consensus within the organization. That's kind of one of the stall reasons. We know all buying scenarios are not, you know, created equal. Can you talk a little bit about what is that range of buying scenarios that we're seeing right now? And how does it influence buying behavior specifically as it pertains to content? Yeah, so we see buying complexity along a spectrum. And as you, as you know that business decisions, business purchase decisions are not usually not made by an individual alone. They're made by teams of people, but not all teams act the same. There's a spectrum of complexity when you, when you look at the number of people that are involved, the number of departments that are involved, the price point and the timeframe in which those decisions are made. So we've created a pretty simple way to think about the complexity of these purchase decisions. So the least complex are independent purchases. And these are often made by one or two people across a department or two. And it's an agreement among these individuals that this is the right decision for us as an organization. These are typically on the lower end of the price range less than $50,000. And they take maybe less than two months. Now, this is not set in stone. So this is a range. So things could be higher, things could be lower. But it's It's just a way to start thinking about the complexity of your particular, how your buyers buy your particular set of offerings. The next level of complexity are consensus buying scenarios. And these are buying decisions that are agreements across teams or different functions or departments in an organization. And so there's probably about three to five people involved across as many departments. So if you think about maybe it's a marketing automation platform and you have somebody from, you know, certainly from marketing operations, you might have somebody from business operations, somebody from IT, maybe somebody from finance. So you have, when you go back to the roles that different buyers play in the buying group, this is where that becomes really, really important is what is the button that each of those individuals, you know, what are the, what are their care about? Those three to four, three to five different people. What do they care about? And it's going to be different because they're coming into that buying process with different needs and different expectations that we need to really tease out. And so these consensus decisions are typically one or two quarters and they are 50,000 to, to about a half million dollars. So again, it's, you know, a little bit more considered purchase, higher stakes, you know, more exposure across more departments. And so the most complex are committee scenarios. And this is an agreement among the executive team. So this is a critical, highly considered decision that oftentimes is, you know, part of a larger transformational effort that an organization is trying to undertake. There could be six to 10, maybe even more people that are part of that buying decision across at least five or more different departments that have stake in that buying decision. So you can imagine that the amount of time and the price point is probably commensurate with that kind of complexity. So a half million dollars or more, you know, a couple of quarters or more to make that particular purchase decision. So with that in mind, when we looked at what kind of assets resonated most with those three different buying scenarios, the five or six content assets that are in the business that resonated the most were analyst reports, case studies, demos, executive reports and presentations. And so you can see that those are a range of kind of long form content, interactive content, high level executive report type of content. So it really is a range, but it was only when we were able to look at all three of those buying scenarios that we could confidently say that yes, if we were to invest in these five or six different content assets for our buyers, we are very confident that these are the ones that are going to make the biggest impact rather than trying to create unique assets and content or just create a what we often see as a standard bill of goods or bill of materials I should say that are not reflected that do not reflect buyer preferences. It's just sort of this is what we always do for our campaigns. We have this, this, this and this, no matter what kind of campaign that we have without understanding what the buyers are actually preferring. And I think what's going to make probably the upcoming year more interesting is Jenny I and kind of the role that it would play in creating that content. So it would be really curious to see how this pans out next year if some of these preferences hold up. That is such a fascinating question because not only is it from a content perspective, but we're really eager to see how buyers are going to be leveraging these Gen AI tools to help them make more efficient, faster purchase decisions. When they're when you're querying, you know, these five vendors, you know, summarize their capabilities for me based on my needs. I think it's going to have a really big impact in that scenario of research that we're looking at for 2024. So stay tuned for that. What I also love about these reports is that they're for different roles, right? So like what you would just were describing aim it was broadly generally, these are some of the content preferences, but you can see it by when you're targeting and what, you know, that may be very nuanced depending if you are a security professional or an IT professional or what have you. So it's great to get that level of detail too. Maybe we can get some insights specific to regional differences and nuances. I know that's always something we're interested in within marketing as we, you know, go to market in different countries and regions. Good share some some stuff there. We looked at two different sets of factors, one that was more focused on the particular offering. And then one that was more focused more on the provider and sort of the surrounding factors. So let me give you an example. So for the kind of technical focused reasons, those could be things about the expertise that the provider brings, the price of the offering, the domain expertise that the company or the provider brings to the table. So those are just some of the, some of the sort of technical reasons why a buyer might select a particular one vendor over another. And when it comes to those technical reasons, buyers in North America and Europe found that price and that price was primarily the main deciding factor for their purchase decisions. Whereas in Asia Pacific, domain expertise was really kind of the thing that they cared the most about and that they were making a decision partially based on the provider's ability to demonstrate its domain expertise in their particular area. So they want to know, you understand my region, you understand my market, you understand my buyers and you understand sort of my overall business. That was far more important to to buyers in Asia Pacific than it was in North America. So then the other set of factors are things like cultural or organizational reasons that the provider was able to demonstrate. And so some examples of that might be the brand, you know, that the provider carries its reputation in the market. How well it understands the organization, how well it can transfer that knowledge or share their knowledge and capabilities with the buyers. And so what we found here is that buyers in all parts of the world valued a vendor's brand and reputation above all else. That really was an important element to them that they wanted assurance that they were doing business with an organization that has a proven track record, that is a known element, a known quantity in their particular market, that they have examples of success stories that they're able to bring to the tables. So those are things that that mattered for buyers globally. But in Asia Pacific in particular, dedication to diversity, equity and inclusion programs was a really important element, a important factor for them far more than in Europe and North America. And I think it's a reflection of just some of those significant differences in other parts of the world of how business is done. It's done differently. It's done perhaps more in a more consensus type of a scenario. It's, but again, it's not one size fits all. We have to look in the specific types of markets and the types of buyers that we're looking at. But that was a unique insight that we were also surprised by. So there's a lot that B2B companies have to take into consideration when it comes to making sure that they're flexing their muscles based on the type of buyer and the type of market and all of that. There's so many factors that we covered today, right? Generational gaps, financial constraints, some of the regional differences. What should they do to succeed in this very complex buying environment? What are some few things that we can advise tangibly to these B2B companies on what to focus on? So there are a few things. We talked about some of them, but I'll repeat them again. But one is don't just enable your sellers. Look at who is having those conversations or who is supporting the buyer even asynchronously through digital programs, for instance. How are you enabling those people to have the best understanding of those buyers and how they buy what their preferences and behaviors are? So it is what we call it. revenue enable enabling that entire revenue engine To be able to support the buyer not just focusing on sellers that sort of one one take away Another is Consider making pricing information more transparent. I think we so often want to hold that information close to the vest But we're seeing loudly and very clearly that buyers want that information They want it probably earlier in the buying decision process than what we're giving that to them And even for more considered products. We can put pricing information You know in front of the paywall there there's there's there are things that that we could look at for instance if this is an established market If this is a particular problem that buyers have solved before they're familiar with it They've bought similar types of offerings those are great opportunities to provide more transparent pricing So it doesn't always have to be you know smaller You know more transactional offerings. It can be more considered relationship kind of driven offerings The other is to when you think about The extended network of influencers. So this is really true for younger buyers in particular Younger buyers value these external influencers whether they are analysts consultants etc Equally as much as previous experience From the vendor themselves and so this enabling and educating that extended network is really really critical So that's where really thinking about the reputation programs that are part of your overall campaigns whether you're talking with an industry analyst with reporters other influencers in the market. It's absolutely essential that they Know what your value proposition is know what what your capabilities are so that they're able to convey Accurate information to buyers when they are consulted or engaged So that's kind of the other area and then the final I mentioned this also before is This information that we're sharing not just in our global report, but for the individual reports That we're publishing or that we you know that we have published is to pair this with your own data to compare this with what you know about your buyers pulling it from Your systems from your Salesforce automation systems your marketing automation systems your content management systems making friends with your ops counter parts to be able to Get this insight in a way that is actionable and useful so that you can compare and contrast But also pair it with with conversations that you should be having with your buyers every single day So it's not just what we see From a quantitative perspective, but you need to also have that qualitative Insight into your buyers by having conversations with them on a regular basis to make sure that you are staying abreast of their needs their preferences and their behaviors And if you are a Forster decisions client You can actually request a custom cut of the data Based on the audiences that you're interested in so we can look at specific Offering categories we could look at specific personas And maybe it's an organization size and enterprise size that you're more interested in maybe if it's a geography So there are many ways in which we could Look at the data to get as close of an approximation to your target audience to get really close to To those insights. So that's an incredible I think opportunity and I just have one caveat that It's dependent on the sample we have to have a sample of a minimum of 30 So that's that's the The caveat that we have there the requirement, but it's a great opportunity to Leverage this data in a more specific way for your business So much information Amy so much useful information super excited. This is out and on a rolling basis. So Thank you so much for joining us today Thank you so much for having you. It was great If you like what you heard today subscribe to Forsters what it means podcast on Apple podcasts Google podcasts or your favorite podcast player To continue the conversation follow Forster on Twitter Instagram and LinkedIn or drop us a note at podcast at Forster.com Thanks for listening