Understanding where the power lies in your market is critical to making smart strategic decisions. Despite this, many business spend a disproportionate amount of time focusing on their primary customer, consequently neglecting those who may influence the customer choices. (I have a free spreadsheet tool, called ‘Customers & Influencers’ that can help you identify where the power lies in your market and assist you in allocating your resources more effectively, which you can download here – more on that later)
‘The customer is king’ is the venerable adage that you don’t have to work in marketing to be aware of. It reflects the fact that customer have long been the near exclusive focus of marketing efforts. In simpler times this made some sense. Businesses had customers who bought products – end of story. But in today’s more connected and complex world, other entities have the ability to influence the demand for your product.
At a very basic level most of us are aware of the idea of different customer types. The classic example often used is the parent, shopping in a supermarket, buying breakfast cereal for a child. The cereal manufacturer has three customers to focus on.
The retailer, who they have to persuade to stock their product, typically by investing heavily to stimulate demand.
The child, who they have to persuade to eat their product, often by the use of primary colors, cartoon animals, conspicuously large amounts of sugar, and a plastic dinosaur lurking within the box.
The parent, who they have to persuade to buy their product, usually by giving assurance that you are providing your child with some degree of nutrition or wellbeing (or the ability to shut them up while you enjoy your coffee).
Any of these customers have the capacity to impact the demand for your product. A smart business will allocate resource across all three to make sure the most effective message is being communicated.
But these simple examples only take us so far. Consumer examples can be instructive but don’t always translate effectively into B2B markets. To go little deeper we need to understand what an influencer ecosystem looks like. There are two varieties.
The first and most obvious is to look at how your product gets to the end consumer through each step of the supply chain. Anybody involved in this logistical effort or who provides some value adding step has the potential to exert some influence on the demand for your product.
Typical roles in the supply chain include suppliers, manufacturers, distributers, wholesalers, retailers, buyers and consumers. Supply chains can be quite simple but in many B2Bmarkets they can also be very complex, especially if you are a long way upstream.
As an example, imagine you are a chemical manufacturer and one of your products is used in fire retardation. You supply textile manufacturers. Who in turn supply materials to designers and manufacturers of aircraft seats, who supply to airlines or specialist aircraft interior designers, who create the environment that airline passengers ‘consume’ and that airline operators have to maintain and clean. That is a lot of ‘customers’.
And that is only one pathway; your fire retardant chemical could end up in domestic furnishing, children’s clothing, hotel interiors and so on. When drawing out your supply chain keep thinking ahead to your customer’s customer until you reach a final end user or consumer.
The second influencer ecosystem is not based on any physical involvement with the supply chain but derives its power from the opinions and beliefs of individuals who influence purchase decisions based on the credibility or authority they have with the buyer.
A simple example would be a new parent deciding what infant formula to give their child. That decision will be heavily influenced by people outside of the supply chain; the friends and family of the new parent, health care professionals, other new parents, magazine articles, online forums such as mums net and so on.
Most decision makers, even in B2B, do not exist in a vacuum. They may have decision-making authority but others often influence their decisions. You can visualise this by placing a defensive circle around the buyer (see below). A sort of protective filter that the messages from competing suppliers have to get through to reach the buyer. The smart thing to do is to turn these gatekeepers into advocates. But first we have to identify them.
So we have two influencer eco-systems; the direct supply chain and the indirect ‘defensive circle’. It’s time to move on from concepts and start to collect some names. The following list contains categories of influencer types. It is not exhaustive but it is the list I use in workshops and typically covers 99% of potential influencers.
Customers – People who place the order or buy the product. They tend to be your primary contact.
End Users – the people who use or consume the product.
Intermediary – Anybody in the supply chain who isn’t your primary customer or end user.
Referrer – People who introduce customers to potential suppliers.
Specifier – People who decide what criteria a product must comply with.
Payer – People who make payments and manage the purse strings.
Advocates – People who actively promote specific solutions and products.
Advisors – People who primarily put the customers interests first.
Expert/Opinion Leader – People whose opinion is listened to and acted upon.
Peers – Groups of people who collectively set behaviours and drive conformity.
I already mentioned that these ten categories are not exhaustive. They are also not mutually exclusive; customers can be end users and payers, referrers can be advocates and so on. And not every category will be relevant for every market. By thinking though each category you should be able to brainstorm a comprehensive list.
In true brainstorming style you will end up with a long list that will need further refining. You start by weighting the relative importance of each influencer and then decide which ones to take forward for analysis.
At the analysis stage you compare how much of your current resource is allocated to each influencer and see if this allocation matches the importance you gave to each influencer earlier.
Any gap between resource allocation and importance can be identified and a quick calculation will suggest how your resource could be allocated to each influencer to match their relative importance.
If those last few steps sound complicated, or at least unclear because I pretty much skipped the details – don’t worry! The entire process is available on a completely free spreadsheet, along with a video that explains how to use it, which you can get you hands on, no strings attached, simply by downloading it from my web site, under the ‘Tools’ tab.
I am not often prone to acts of spontaneous generosity but the way I see it is a few people who use this free tool will be influencers in the firms they work for. They may be in a position, at some point in the future, to advocate for hiring a marketing strategy consultant to help improve their businesses capability.
I am just trying to influence the influencers – that’s how this works.