Value Based Business

CtoB Value (Community – to – business)

BtoC is where a business sells to consumers

BtoB is where a business sells to another business

CtoB, a characterization I invented, is where a community gives value to a business that it loves.

Imagine a world where tribes of people live independently in the forest. Maybe in prehistoric times.

A stranger appears at the edge of the clearing and the elders of the tribe come to greet him.

“What do you do?” they ask.

He answers, “I am highly skilled at building roofs for huts. I can build a roof to keep the rain, sunshine, and insects out.”

The Elders reply, “We don’t use roofs in this village. We love the rain, the sunshine, and we rub plant juice on our bodies to keep the bugs away. You can stay, but you will have to work hard in the fields and provide your own food.”

The stranger left and months later, came upon another clearing. Again the elders came to greet him. When they found out he was a master roof-builder they got very excited.

“The roofs of our village are in great disrepair. They leak when it rains and our people are constantly subject to bug bites, sunburn. If you will stay here we will give you the best home and bring you all the quality food you need…”

The modern economies of the world are no different.

If a person provides a valuable product or service to a community, then the community will support them.

This idea was highlighted in a short, very sweet book called “The Go Giver” by Bob Burg. I recommend it.

The point here is that to be successful, you need:

  1. A Community. This is a group of people that you are able to reach and that will listen to you. It can be a community that you are already a part of, or it can be a new community that you join and work hard to become well-known in.

For example, when I started my business providing websites for energy businesses, I was already well-known in the renewable energy field from my previous job. People in this industry knew and respected me. I had written articles for energy magazines.

For my pet supply business I had a different challenge – I did not own pets and had no connection to any pet-related communities. When I started this business I had to get involved in pet-caretaker communities and build my own. I did this by introducing a new idea; that it was good to care for handicapped pets. A community of pet caretakers formed.

  • A valuable product or service. Once you have the ear of a community, you need to find something they need that you can, and want to provide. My energy community was mostly electricians that wanted to get into renewable energy and did not know how to promote themselves on the web – so I created a web development company. For my pet caretaker community, I had no idea what they wanted so I used a key business development strategy: Listening to people complain.

People love to complain and always seem to be looking for someone who will listen. Get people started and they will complain endlessly about anything and everything. In these complaints is your core business idea.

                Train your ear to pay attention whenever anyone complains about anything!

Evaluate their complaints with questions like these:

  1. How much pain?
  2. How many people are complaining?
  3. Are there already products or services that will help?
    1. If so, why aren’t they using them? Too expensive, not effective…
  4. If you create a system to solve their problem, can other people copy it easily?
    1. How will your solution be unique. Sometimes it’s enough to be “the first.”

My energy websites were popular because people knew me, trusted me, and didn’t really know where else to go. Sure, they could get a website done anywhere… but with me there was no risk. My pet business featured a dog wheelchair with required a big investment in molds to make – and I had patents in the US and Europe. People were reluctant to invest in a product they were unsure of. Now that I’ve shown them how big the market is, competition is coming in and I need to develop new products for my community.

Who is your community?

                Or who would you like your community to be?

What do they need that you can, and want to provide?

                If you don’t know yet, listen to complaints.

How to create a community.

                A community can be any group of people that you are connected to in some way, and that you can communicate with. Often the group has a common interest. For example a WeChat or Facebook group of people who love their dogs, people who like old cars, people who like Marvel movies… any group can be a community.

                Often, you have an email list of contacts from a business. Sometimes you have to create a new community or join a community. If you are going to sell a new kind of foot powder you might want to join a group of runners.

                One of your first challenges is to become well-known and respected in your community. At some point, you’re going to tell them that they need your product or service. They need to know who you are and that you can be trusted.

                If you have an email list, you might want to start by sending out an attractive, informative newsletter that people in the community are going to find worthwhile and interesting. If you are in a discussion group, you might make a video. They key is to gain respect in the group and become known as an expert.  What is a question they all have on their mind? A problem they all face? What is something they all want to know? Ideally, this can relate to the product or service you are going to provide, but often it’s best not to mention that you’re selling something until you have already gained their respect.

                For example, my group of renewable energy providers were just becoming familiar with the web and were worried about security. To get their attention, I might write a few newsletters about internet security, scammers, and other interesting, relevant topics. If I can get them discussing it online, even better. After a few monthly newsletters, I might want to introduce my solution.

                Here is an example of how it might work:

                Recently I saw a small fishbowl on someone’s desk containing a jellyfish. It was really beautiful to look at. I enjoyed watching it. Perhaps I decide that I want to sell desktop jellyfish.

                I would look for a several web forums or discussion groups about desktop jellyfish. I would join them and start asking interesting questions and getting involved with discussion. I would work to become known in the desktop jellyfish community. I would also learn everything I could about them and become an expert.

                Perhaps I’d find that the biggest problem that jellyfish owners had was keeping the jellyfish alive for more than a few weeks. Listen to them complain – they’ll tell you what they need. I would create a booklet and, perhaps a video, called “10 Strategies to Long-lived Jellyfish.” Because I did my research it would be an excellent resource and be shared frequently. There would be some sort of call-to-action. For example, “I’m working on another booklet, please give me your email address if you would like a free copy.” Depending on how interesting, informative, and useful your booklet is, you might get a hundred, or a thousand emails. You now have a community; a group of people who know you, respect you, and will open your next email. This is a group you can sell your product or service to.

Business Communities.

                The challenge is different when selling to Business to Business, but the theory is the same. You need to provide a valuable product or service to the business. This can fall into a few categories:

  1. A product for use inside the business. The business is the consumer.

You are solving a problem for business itself. This was the case when I was selling websites and marketing services.

  • A product for resale by the business. The customers of that business are the consumers. Currently, I am opening a veterinary sales division, selling pet care supplies to veterinarians and veterinary hospitals that they can re-sell to their customers.
    • A PUSH strategy.

When you are PUSHing the product to the reseller, you are giving them a reason to carry your line. Common reasons are:

  1. Price. The company will make a better profit margin on your product.
    1. Brand. You are reducing their risk because you are a well-known and respected brand name.
    1. Convenience. Payment terms, shipping, packaging, return policy… something about your product makes it easier for them to carry and re-sell.
    1. Relationship. The decision maker likes you, trusts you, and wants to do business with you.
    1. A PULL strategy.

This refers to getting your reseller’s customers to ask them for the product. Tom Judd was the creator of an early computer supplies company called “Curtis Manufacturing.” This was before the internet was in widespread use. He was a brilliant marketer and I was his Director of Operations and his student.

Computer supplies, at this time, were sold by specialty computer stores. There were, perhaps, 100,000 of them in the US and Tom had acquired a list of about 25,000 of them.

Tom took out full-page advertisements in the major computer magazines telling people to call a toll-free number to find their nearest dealer or computer store. When they called, the customer service staff would give them the name and number of their local computer store from his 25,000 store list. 

The computer store had probably never heard of Curtis Manufacturing or their products until the customer called them, but suddenly, the store was getting several requests for Curtis products. Either the store would then call Curtis and place an order, or the Curtis sales manager would call the store with an offer.

                Curtis Manufacturing, “pulled” his products through distribution.

  • Selling to a person inside the business
    • A certain person has the authority to select and purchase your product.
      • Identify
      • Reach
      • Motivate
        • This person will buy your product if he is personally motivated to buy.
          • Want to do the best for the company
          • Desire for recognition
          • Personal gain
  • Selling to a department/company
    • Product will be purchased if it is in the best interest of the department/company.
      • Price
      • Features
      • Brand/reputation
  • Selling to the customers of the business (Pull)
    • Their customers will ask them for the product.
      • Drug companies advertising to the consumer (“Ask your doctor…”)
  • Getting the business to come to you

The needs of a business are simpler than the needs of a community. The primary desire of a business is to make a profit. You need to show them how your product or service will help them do that. One of the great challenges here is every other business is making the same promise. There is so much “noise” from other businesses clamoring for attention with promises of higher profits that you message can barely get through.