Multiple Participants in the Buying Process

The buying process frequently involves more people than just the customer, since others participate by providing information, facilitating search, and influencing the purchase decision. Multiple participants are, in fact, the norm for purchases of high involvement goods characterized by complex offerings and, often, higher prices. Multiple participants are also common in most business markets, where purchasing is managed by professional procurement managers using sophisticated information systems and aggressive negotiation tactics. The addition of individuals to the buying process complicates the job of value communications because it forces marketers to adapt and deliver multiple messages at different points in the buying process.

To illustrate how value communications can be adapted for multiple individuals in the buying process, we turn to the example of a chemical company attempting to sell the value of a new chemical additive for a steel mini-mill. Suppose that the chemical provided an incremental $18 per ton in monetary value for the steel producer. However, the $18 is an aggregate, company-level estimate that is not equally relevant to the different stakeholders in the customer organization . For example, the marketing manager may appreciate the total value estimate, but he is impacted directly only by the fact that the chemical additive enables him to penetrate new market segments. The melt shop foreman will value the reduced scrap rate, worth $2 per ton, but he will be less pleased about the $5 cost created by the additional process steps needed to incorporate the additive into the steel slurry. In the end, the melt shop foreman may be negatively disposed toward the product because it lowers his organization's financial performance even though the overall value is positive. Finally, note the value impact for the procurement agent is neutral because her functional area has no operational involvement with the additive; she is only involved in negotiating the price.

EXHIBIT 4-8 Distribution of Value Across Organization

Multiple Participants in the Buying Process

The need to adapt marketing communications to the product and the customer's context makes creating effective value communications more challenging today than ever before. It is not sufficient to adapt the content of the message to the customer's learning needs at different stages of the buying process. You must also ensure that it is delivered to the right person at the right time in the buying process. Accomplishing this task requires meaningful insight about what value is created, how that value is generated across the organization, and when the participants in the buying process are ready to receive the value messages. Our research shows that successful value communications requires close coordination beween marketing and sales — a trait lacking in many of the organizations we surveyed. For those companies that make the investment to strategically communicate value, the return, in the form of more profitable pricing, can be substantial.

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