On November 5, 1998, I found myself standing in front of a display at the big Barnes & Noble store in Boulder, Colorado. I was puzzled, curious, and feeling a little bit desperate. A powerful competitor had just bought the company that supplied us with essential technology. I opened one book after another looking for a solution.
Four days before, we were on top of the world. We had just hired a prized CEO that our venture investors loved and would support on our challenging journey. The business-to-business (B2B) ecommerce technology sector was hot and getting hotter, with top analysts predicting that most B2B sales would be on the web.
We moved fast and built a shiny new B2B catalog solution and, fueled by dotcom venture capital, went from 0 to almost 20,000 customers in less than two years. We were so confident that we passed on a multibillion-dollar acquisition offer in favor of a “sure thing” IPO.
They say timing is everything, and when the bubble burst in 2020, it sure felt like it. One bad thing followed another as capital sources dried up when many of our B2B marketplace customers folded.
About five years later, the company sold for little more than its bank balance.
People familiar with this story usually lay the blame on a person or people, our VCs being a favorite target. Some say we were the victims of bad timing. Others say we should have focused on a different market — perhaps big suppliers instead of big buyers.
As the years have gone by, I have come to believe we simply were wrong about B2B buyers: We believed B2B buyers needed information to help them select the best solution in the market. After all, they knew their needs and certainly didn’t want to be bothered, or lied to, by a vendor’s sales rep.
We were wrong. It turned out that B2B buyers need more than information. For replacement commodities, maybe information was important. But even when buying those commodities, buyers preferred to purchase from a trusted supplier. As for anything unfamiliar or innovative? No way does information alone suffice.
The reason for our fatal error lies deep in the heart of B2B buying. In business-to-consumer (B2C), the consumer risks their money. Given easy credit and generous return policies, consumers buy with confidence. Pick it, click it, and it shows up the next day. Don’t like it? No problem. Send it back!
For the B2B buyer, it’s not so simple. The B2B buyers put their reputation and, potentially, their jobs and even careers on the line with each substantive purchase decision.
So, potential B2B buyers do lots of research. Who wouldn’t? But is research enough, even in today’s world of information abundance? Was that article just found while researching really written by an unbiased expert? Or could they be a paid “influencer”? How about that product comparison site? Pay to play, or what? And what about Google searches or pop-up ads, LinkedIn posts, pitches disguised as connection requests, unsolicited emails promising a 10x return on investment?
The internet serves up whatever it wants — and usually whatever makes someone the most money. The buyer is stuck, unable to tell fact from fiction without a trusted guide. However, during a genuine human conversation (say, during a cold call or discovery call), each buyer trusts their own instincts to figure out who they can trust. They can’t — and therefore don’t — trust mere information, no matter how compelling or easy it is to find.
The truth is, sellers don’t actually compete with each other: They compete with the buyer’s uncertainty. And until the buyer trusts one seller more than they trust themselves — not merely more than they trust the other sellers of a similar product — “no decision” wins.
Now you know your real job as a B2B seller: Build trust — and then don’t blow it. Simple, really.
Follow Chris Beall on his Market Dominance Guys podcast on your favorite podcast broadcaster. Chris Beall is CEO at ConnectAndSell, a Silicon Valley–based corporation. For 30 years, Chris has led software startups as a founder or early-stage developer. He believes the most powerful part of a software system is the human being, and that the value key is to let the computer do what it does well (go fast without getting bored) in order to free up human potential. To learn more about what ConnectAndSell’s sales-acceleration platform can do to help you achieve your sales goals, visit https://connectandsell.com/.