B2B players are moving from a product-centric business model toward a customer-centric one. 63% of B2B CEOs already list customer centricity as one of their top three priorities
“What do you really want?” This simple, but significant question often plays on the mind of any marketer or salesperson. Unlike in business-to-consumer (B2C) markets, many business-to-business (B2B) players find it difficult to ask this question to their end-users because they simply do not have a direct relationship with them. In the age of customer centricity this poses many challenges, ranging from fulfilling customer needs to providing meaningful support and service. However, the tide is turning as new technologies are enabling B2B players to gradually move down the value chain. A seismic power shift is on the horizon.
Moving beyond the middleman
B2B players are moving from a product-centric business model toward a customer-centric one. 63% of B2B CEOs already list customer centricity as one of their top three priorities. To make this happen, companies need to invest in establishing relationships with both direct and indirect customers. This is where the challenge arises; middleman companies position themselves as the owner of end-customers to remain the value-generating party in the value chain. However, technologies such as the internet of things (IoT), blockchain, and virtual layers are providing the ultimate solution. B2B players can now extend their reach beyond middleman companies, and become increasingly relevant for end-customers by building a value-based ecosystem in two ways: the value push and the value pull.
The value push: Enrich your products and services
With customer centricity on the rise, companies are searching for ways to create a seamless experience that meets every customer need. This includes customer needs that arise not only during, but also before and after a purchase. By integrating sensors and data-enriched materials into products, B2B players can generate value through the entire customer life-cycle. Here are two examples of how to add value:
- Creating a virtual layer with the digital twin: The digital twin is a virtual representation of physical assets that enables the user to generate informative and actionable insights. Companies such as GE and Siemens are already heavily betting on the rise of this technology. While often used for simulation purposes, the digital twin can also be integrated within the product material through the placement of sensors or recognizable patterns. The end-customer can scan the sensors or patterns and see an augmented reality layer with rich, contextual and real-time content
- Adding provenance with the (block-) chain of custody: With an increasing need for sustainable sourcing, the chain of custody can provide information about tracing the history of the product materials. As blockchain solutions rise to prominence, sourcing information becomes highly trustworthy. B2C companies, such as Unilever and Sainsbury’s, are piloting tracing tea leaves using blockchain technology. Similarly, B2B players can start sharing their sustainability performance more explicitly with the entire value chain to improve their brand reputation.
The value pull: Start a silent conversation
As well as enriching the product with data, B2B players can capture insights from the product. IoT sensors can be integrated within the product materials, and start generating data about the product’s performance and its environment. While the data is often only shared with the user, it can also be sent back to the selling company. This can be leveraged especially in service-centric business models. Let’s look at how Rolls Royce reshaped its business model by initiating a silent conversation.
Although Rolls Royce is most famous for its luxury cars, a much larger part of their business focuses on the production of aircraft engines. Additionally, they provide maintenance services to ensure the engines always perform to a high standard. Rolls Royce has pioneered the use of IoT-enabled monitoring since 2001, and recently has invested in setting up predictive maintenance-as-a-service. This keeps track of fuel efficiency and machine performance. Through real-time analytics and machine learning, multiple terabytes are processed each flight. This data can then be used by Rolls Royce to schedule new maintenance appointments before the customer recognizes the need for it. Data from sold products is sent back to the selling company and used to optimize services, meaning they can strengthen their position in the value chain.
Redefining your position in the value chain
So where to start? The challenge of obtaining a new position in the value chain is not one of technology. It’s much more about how you create value from it. Before investing in ways to leverage technologies, B2B players should reconsider their value propositions towards the entire value chain. This means that end customers will become part of the playing field. 3M recently launched their consumer-focused “Wonder” campaign, which is a strong example of how a B2B brand reached beyond their direct customers through targeted advertisements. After defining their proposition, B2B players must create an ecosystem where they can add value for their customers and monetize this value for their business.
This seismic power shift to B2B backed by new technologies will surely help create a direct line of communication with the end-customers. The important thing is to be a part of it at the right time, and with a team that can help you go on this journey.
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