Trust-Based Selling: Finding and Keeping Customers for Life (2015)

Chapter 3. The Buyer Process

Laying the Foundation

Don’t reinvent the wheel, just realign it.

—Anthony J. D’Angelo

You need to lay a foundation on which to build the trust-based strategies needed to win new customers. The first place to start is to understand the process the buyers follow with every purchase, small or big. This is a naturally occurring series of stages; the goal is to define each of the stages to give you common ground to build upon.

The Buying Cycle

Books regarding selling and buying cycles fill the shelves of stores. They go into much more detail. There are many different sales processes companies use, and most likely your company has a process in place.

My model is a simplified version that encompasses the main concepts of most processes (Figure 3-1). The core buying processes are the Needs Analysis, Evaluate, and Purchase phases. In total, this model defines the entire vendor-customer relationship cycle.

Figure 3-1. Buying process

This process applies to every purchase a customer makes, from consumer-based purchases to multi-million dollar business-to-business purchases.

Let’s look at each of the steps in order.

Status Quo

Customers are conducting business as usual. They have their preferred vendors, and they may be evaluating purchases today. They are influenced by industry trends. They are constantly being asked to drive cost down. In some cases, depending on which department is the target of your sales efforts, they may be asked to increase revenues. Today, the customer is living with issues. They may not be aware of the issues they have. They may have inefficiencies that they may not be aware of. Customers always want to simplify their lives, so a lot of times they have vendor-reduction programs underway. They have 30 other people just like you calling them daily. At a certain point, a compelling event—called a trigger—will occur that will cause them to move to the next step.

Needs Analysis

An event has happened, or a business need arises that influences a particular department. The customer is now tasked with understanding the issue. Depending on the complexity of the issue, customers will look for external help to define their needs further and start exploring options to solve their issue. Once they feel they have a solution, or even multiple solutions, they proceed to the next phase.

Evaluation

Customers look at each option. They ensure the solution works to the specifications the vendor has promised. Once they settle on the most helpful solution, they move to the purchase phase.

Purchase

The purchase phase for the customer involves budget approval, if not already done; negotiations with the vendor(s), contracts, terms, and conditions; and purchase orders.

Most buyer and sales cycles stop after the close, since they are typically focused on the sale. I want to discuss two more steps that truly complete the buyer/seller relationship. These steps are important in the process of understanding your main competitor, the incumbent. I will discuss later how the stages impact trust and how they create an unfair playing field that you must be aware of.

Implement

Buyers will implement the solution or utilize the product they purchased. The buyer can implement the solution by themselves or with help from the seller. The buyer is evaluating the ease of implementation. Are there any surprises? Challenges? Did the seller stay past the close of the sale? Was implementation easy or hard?

Measure

Does the solution live up to the buyer’s expectations? This step is often neglected by both buyer and seller. In most B2B sales, an ROI is presented. Does the solution in fact meet the ROI objectives? This is one of the most important steps in maintaining customers, and lead to easier referrals; both internal to the customer and external.

The final two steps in the sales cycle—implementing and measuring—are areas that most salespeople neglect. If you want to be a superior salesperson, pay attention to these final steps in all sales. The good news is that the typical incumbent’s lack of focus in these stages is a weakness you can exploit. Again, I will discuss this in further detail later in the book.

The Buyer’s Four Concerns

Concentrating back on the main purchase phases—Need Analysis, Evaluate, Purchase—the buyer balances four psychological concerns. These concerns are need, cost, solution, and risk. As Figure 3-2 shows, the relative level of concern for each of these shifts throughout the buying process.

Figure 3-2. Shifting buyer concerns

When buyers first enter into the buying cycle, the primary concern is need, followed by cost, solution, and risk. When you enter into a decision to purchase, you know you need something, and you know about how much you can afford, or how much a solution might cost. Today this has never been more true with pricing information on the internet. In the first phase, buyers start off not as concerned with the solution. As buyers progress through this stage, they evaluate their needs in more detail and start to get a better sense of what they are looking for—the solution. Notice that cost concerns start going down. Risk starts to rise since the buyer is spending more time on this purchase—the risk of lost time.

In the evaluation stage, customers are focused on the solution; they may test-drive a car, look at a house, try ice cream flavors, demo your solution, or conduct a formal evaluation. During this phase, buyers stop focusing on the need, and start focusing on the features and functions. Cost concerns are very low. Risk continues to rise as they invest more time in the process.

In the purchase phase, the focus moves to risk. Buyers are concerned about whether they are making the right decision. Do they sign on the bottom line? What if they make a mistake? In a business setting, this can affect a person’s career if the purchase is large. The concern with cost rises in this stage, but notice that cost is never top of mind in any stage. It is also important to note that need and solution are nearly out of mind in the final stage.

Example

This example illustrates the activities and concerns as they shift throughout the buying cycle. It revisits the house scenario discussed in Chapter 2.

In status quo, everyday living, you have been thinking about moving. But you decide you can live with the pain of the commute, and you are okay with the smaller house. The thought of the cost and chore of moving has you cringing. You get home Friday after work, and walk into the kitchen to talk to your wife about your idea of buying a boat. Before you open your mouth, your wife, smiling, says, “Guess what?”

“What?”

“We are going to have another baby!!”

Being smart, you tuck the bass boat idea away. “Wow that’s awesome honey.” After some hugs and kisses, you say, “You know, we need to buy a new house.”

You just had a compelling event, a trigger. There is no way your current house will provide enough room for two kids.

Most likely, you do not have real estate agents cold calling you, but over the years you have made friends with one or two, and you call the one you feel will help you find the home you need, someone who knows the market.

Needs Analysis

As far as the seller is concerned, this is when the buyer enters the market and into needs analysis. Assume that you are sitting down with the agent for the first time to go through your needs. In the early part of the sales cycle, your needs are loosely defined: you know about where you need to look, how much you are willing to spend, and you probably have an idea of the number of bedrooms. When you meet with the agent, she will start to define your needs in more detail, probably by asking a series of questions. How old are your kids? Are you looking for a sidewalk neighborhood, or more in the country? How long of a commute are you willing to tolerate? Does the age of the home matter? Would you like new construction? Number of bathrooms? How much land are you looking for? Do you care which school district? And, so on.

Just as in the buyer concern graph, you come in with some needs, and then start to more clearly define them. During that process, the buyer is also starting to form a better idea of what they are looking for, or the solution. While defining the needs, cost is not discussed past the initial range you give the agent. At this point you are just developing a wish list.

Evaluation

Now that the agent has a good idea of what you are looking for, she will go online and do a quick search of homes for sale that meet your criteria. Now starts the evaluation period. You sort through all the listings and, based on gut, pictures, pricing, narrow down the list to 5–10 houses to evaluate. You and the agent spend the next week, or longer, touring houses. You look carefully at every house to see if it meets your criteria, while looking for good and bad features.

Look again at the buyer concerns. The buyer’s original needs, or criteria, are becoming less of a concern since most of the houses should have the basics. But, you now are looking at the condition of the house, the wow of the kitchen, the smell of pets. You are more concerned with the bells and whistles of the solution. Cost goes out the window. “What an amazing view of the lake,” you might say, even though the price of this option may be completely beyond your original price range. The evaluation stage closes with choosing a house, and having an inspector make sure that everything is up to code.

Purchase

The purchase stage starts with making an offer. Concerns and emotions can run high at this point. Risk is the highest concern; you just spent two weeks running all over looking at one house after another, and you and your wife “fell in love” with one. Concerns with solution and need are both at an all-time low. Now it’s about the risk and the price. Price is not the main factor in closing. Rarely do homebuyers go for the lowest-price house they look at. Risk is two-fold in the last stage—the risk of not getting what you need and the risk of signing. Now it’s time to sign the mortgage papers. You and your wife sit in the lawyer’s office signing 40 different documents. You have seen the numbers for the last two weeks, but now is the time to sign, and that’s when risk is a huge concern.

Exercise

It would be a great exercise for you to imagine any purchase you have made over the last week, and think through the entire buyer process. For example, you are driving around with the family on a hot day. The kids are getting antsy, so you decide to stop for some ice cream. You just went from status quo to needs analysis. You go through each step by evaluating (sampling), purchasing, implementing, and measuring results (tasting). Will you get this flavor again, or use this ice cream shop again? Every purchase goes through the process and different levels of buyer concern. The magnitude of the purchase determines the effort spent on each phase, and the range of buyer emotions you will experience. Think through going to a restaurant, buying a car, or purchasing a vacation.

Summary

Customers go through each stage of the buying process with every purchase. In some cases, parts of the process are condensed or simplified. You will learn that customers might make the process easier for some vendors and harder for others, depending on the level of trust they have with each. In the next chapter, you will see that sales cycles are nothing more than aligning with the buyer cycles.