Do you have the B2B Market Insight you need to help your customers?
How well do you understand your B2B target market & sector? In the last of his series for us, Peter Lavers shares the importance of market insight for B2B as well as B2C.
This is the 5th and final blog in a series that explores how different aspects of Insight can be used to drive B2B Customer Management.
Knowledge is the starting point for our Customer Attuned Assessment (CAA®) methodology, which is about building better relationships based on trust; working together for mutual
These blogs draw from the international research exercise undertaken in summer 2015 regarding their relative strategic priority, and the CAA® benchmark database.
The ‘Target Markets & Sectors’ golden thread came out as 5th priority overall in the research. It is about how B2B companies decide which markets & sectors to enter, grow, reduce exposure, or exit. A company that has market & sector management as a defining characteristic of its corporate DNA:
- Drives competitive advantage through its expertise in and clarity of the market(s) where it decides to play and the sectors in each market that it chooses to target and develop
- Is disciplined about not expending time and effort on off-target opportunities unless there’s a high-level strategic decision to use the opportunity to open up a new target market/sector
The ranking by sector, region, business size and seniority are presented below.
It shows a range within the groupings from Manufacturing, who rate it as top priority, to only two groupings where it falls out of the top six (larger businesses and the Africa/Middle East region).
Benchmarks
The chart shows the highest, lowest and mean (benchmark) scores for companies on the CAA® database.
It shows that B2B is currently basing its market & sector-level planning on incomplete knowledge – indeed some companies are only just starting their journey.
However companies do not have to achieve perfection to be competitive in the sector.
Businesses that place market & sector management as their top priority should be aiming for a c.70% CAA® score. Those that place it in their top three should be strategically aiming for the upper quartile (56%+). “Focusing on appropriate target markets is the starting point for an effective business model and best use of resources” (Banking, Canada)
In order to score well, a business needs to have solid capabilities in the following areas:
- Have you mapped the way your market is structured?
- Are key drivers of growth or decline well understood?
- Is there good understanding of the most profitable parts of your market?
- Do you track the rate/extent of rising expectations?
- Is internationalisation seen as an opportunity or threat to your domestic business?
How about you? Do you have insights into your sector? Have you mapped your market & understood it’s dynamics?