It’s becoming obvious that narrowly-focused business models based around the traditional “4Ps” of Product, Price, Place and Promotion have failed to keep pace with the complexities of today’s business climate. If your organisation is involved in high-value, complex B2B sales environments, I’d like to suggest 10 key questions that your business model must address...
The questions have inspired by Alex Osterwalder and Yves Pigneur's recent highly acclaimed book "Business Model Generation" - with further adaptation and refinement to reflect our observations of the key dynamics affecting many B2B-focused sales and marketing organisations. I hope that these ten questions prove as useful to you as they have to many of our clients.
The 10 Key Questions your Business Model Must Address
1: What business critical problems do you solve for your customers? Why this is important: because unless your prospect acknowledges a clear and compelling business problem, you have little opportunity to sell them a solution.
2: Who are your ideal customers, and how do they make buying decisions? Why this is important: because traditional segmentation isn’t enough. You need to develop a deep understanding of the common characteristics of your best prospects, and of how and why they choose to buy.
3: What trends and trigger events cause your prospects to search for solutions? Why this is important: because unless you understand their catalysts for change you are unlikely to engage them early enough in their buying process.
4: What are the most important features and capabilities of your solution? Why this is important: because if you can’t relate your solution to their problems you are likely to drown your prospects in a sea of irrelevant information.
5: What are your prospect’s alternative options? Why this is important: knowing your direct competitors isn’t enough - you also need to understand all the other options available to your prospect, including “do nothing” and “build it yourself”.
6: What category of problem and solution do you fall into? Why this is important: there’s no point in inventing a category your prospect doesn’t understand or can’t relate to. You need to understand what they are thinking of when they go searching for solutions.
7: What is your unique value proposition and unfair advantage? Why this is important: because you need to find ways of standing out from the crowd - and of differentiating your approach from all the other options that are available to your prospect.
8: What is your go to market strategy? Why this is important: because you need to understand the most effective ways of reaching your prospects, converting them into customers, and profitably satisfying their needs - including key partnerships.
9: What are your key costs of sale and sources of revenue? Why this is important: because you need to clearly understand the cost and effectiveness of every aspect of your sales and marketing mix - and to have a clear strategy for maximising lifetime customer revenue.
10: What are the key metrics you use to manage the business? Why this is important: because you need to clearly identify the leading indicators you are going to use to determine the effectiveness of your sales and marketing activities, and the frequency with which you review them.
Download “An introduction to the Business Model Framework”
Does your current business model include clear answers to each of these 10 key questions? Can you suggest any other considerations that have proved important to you?
We’ve recently published an introductory guide to implementing the business model framework for companies with high-value complex B2B sales environments. You can download it here. It develops each of these 10 questions in more detail - and shares our experience of helping clients apply the principles to creating repeatable, scalable and predictable sales and marketing processes.