I’m forever pointing out that businesses don’t buy anything, people do. The smaller the business you’re dealing with, the more you need to take into account the decision-making process that these small business leaders use, as well as their personal perceptions of their business needs and their underlying attitudes to the process of being marketed to. This is a complex and subtle set of interactions, some of which change as circumstances dictate, but many of which change rarely, if at all. We need to understand what is constant and can be relied upon and also, what is changeable and why this is.
Something constant we should take into account each time we think about talking to a small business but which is rarely considered at all is the business leader. Now, I’m not saying all business leaders are the same as each other and I’m not saying that if someone gets out of bed in a bad mood, their behaviour will be the same as on a more positive day. What I am saying is that if you want to sell to someone, you need to understand what makes them tick.
Understanding directors
At Information Arts we believe in a number of ‘truisms’, including:
- Businesses don’t buy, people do.
- Business leaders don’t do retail therapy, but they do buy differently depending on the particular values-set of the business leader.
Many of these values are shared by all business leaders and therefore business-level behaviours are most predictable if you can understand what makes those leaders different from everyone else.
Our psycho-demographic industrial classification tool (PIC) is designed to deal with the issues raised by the second truism, but it’s a fairly sophisticated approach and is not useful for everyone. What is needed is an appreciation of how small business leaders see the world and how this can be used to engage them and generate meaningful communications. This relates to our third truism.
One of the questions we’ve asked ourselves has been, What makes small company directors different from other people? We’ve explored this and come up with interesting findings, which can be used to get inside the mind of the small business person to improve both targeting and the nature of the offer.
We measured a large number of small company directors against a general consumer values-based database and found that in a number of areas, small business leaders are genuinely different from the average consumer. For example, small business leaders do not like uncertainty and actively try to manage it out of their lives. They do this through using more information to help make decisions than the average person does. No surprises there, but we can see that any proposition that creates uncertainty in the mind of the business leader will make it less likely he or she will react positively, unless appropriate information is also given. Propositions focused on lots of customer choice for example, are more likely to generate uncertainty and are therefore likely to dissuade rather than persuade a potentially rich source of revenue.
Price matters?
An aspect of the small business person that might lead to surprise relates to their predispositions regarding value and price. This group is less likely than the average consumer to buy something because it is cheap; they also report themselves to be less price-sensitive than is normal. Putting these together we see that price is of much less relevance than whether the product is necessary.
I’m led to wonder just how much marginal income is being lost unnecessarily with all the ‘buy this month and get 10 per cent off’ offers which the B2B marketing space is bombarded with. However well they work in the consumer space, our research tells us they seem to have much less power to persuade in the small business space.
Financial planning
Another aspect we’ve found intriguing is a combination of traits in which small business people are more focused than the typical person on their financial future and the planning that goes with it. They also see themselves as more loyal than the average consumer.
If you can win someone’s business-related dealings and you can provide similar products to them as consumers, then these individuals will be very responsive. The research appears to back this up, but also suggests that in the area of finance, simply knowing someone is running their own business tells you that they are much more focused on building a solid financial future than the average consumer. When was the last time you saw a ‘company director’ flag on a targeting model for home insurance? If their perceived higher degree of honesty translates to a higher level of actual honesty, then this would suggest they’re a better insurance proposition all round.
These are just a few things that make small business leaders different and can be used to drive insight into targeting and communicating with them. They’re a nice bunch positive, self-aware and fairly contented, technologically savvy, information-hungry and interested in their own future. Aiming to reduce the uncertainty in their lives, more disciplined and less indulgent than the average consumer, who wouldn’t want them as customers?
