The Buying Process Has Moved Online
by Jim Griffeth, StratiMind
The Internet Changes Everything...
... Especially the Way People and Businesses Shop For Products and Services
As the Internet continues to drive changes in both consumer and business purchase behavior, businesses are still restructuring their online marketing and operations strategies. Some industries have been totally reinvented as a result - like the travel industry. When was the last time you called up a travel agent and then went down to meet them to explain what you were looking for in a vacation getaway? And how about buying books or music? Chances are you use Amazon or eBay to do your shopping now. Buying cars, electronics, jewelry, clothing, prescription drugs ... just about everything we spend our money on can be bought online. And its not just the hard goods sector either. Renting videos from the local Blockbuster store is moving online as Netflicks and Blockbuster attempt to compete with on-demand cable movies. Consumer banking and financial services have both experienced a similar overhaul. And the list goes on.
What about the B2B sector? Well, the B2B sector has been impacted even more severely by this shift to online buying. The Internet has emerged as the ultimate product research tool and e-commerce transactions cannot be beat in terms of convenience for busy purchasing agents, IT departments, marketing people, sales people and administrative assistants. Forrester Research reports that, as of October 2003, 89% of all corporate purchasing departments had made progress integrating online procurement into their operations. Whether its ordering office supplies or a coffee service, a computer or office furniture, new software or website hosting services, it is all done online. The implications of this sweeping change are a bit scary for even the most technology-agile among us. This Internet thing has, in only a few years, changed permanently the marketing and selling professions.
Anatomy of the New (Online) Buying Process
Marketing and sales success will always depend on the same fundamentals - understanding your target customers' needs, capturing their attention with a compelling and differentiated value proposition and then earning their loyalty by delivering a solution that delights them. Effectively applying these principals requires an understanding of the new online buying process, which is illustrated at left.
Note that Online Marketing programs span the entire range of the buying process, including support for the final full deployment phase. In this final stage, online marketing programs will act to reassure the internal champions that they made the right choice. Online marketing programs accomplish this by continuing to promote competitive wins and reinforcing the positive brand image of the product and thus help diffuse any "buyers remorse".
As an example of how this might play out in real life, lets look at the case of a typical corporate purchase of software. To provide enough process granularity to be useful, we have detailed the 30 steps of this process in the diagram below.
Lets consider the very first stage of the process - Starting to Look for a Solution - when the buyer becomes aware that a problem exists and begins the search for a solution. As every salesperson is acutely aware, many potential customers don't realise that they have a problem, or at least that they have a problem for which a solution exists. This is the traditional education and awareness-building component of the marketing mix. It is the domain of advertising and public relations in the pre-Internet world, and their analogs in the Internet age - online advertising, online news and magazines and online educational programs (e.g. webinars, sponsorships and tutorials). This is where the relationship with the eventual buyer begins - the all-important first impression - and it constitutes the beginning of the process of online branding. In this new online buying process,
Now lets take a closer look at the process of Researching Alternatives and Defining Requirements for a solution to the company's needs, in this case a software application of some sort. The buyer will consciously or unconsciously go through a well-defined sequence of alternating self-education and requirements definition steps until a clear picture of the available solutions emerges and the particular features that are "required" are established. The requirements defined in this stage are not strictly objective, but rather, include the subjective assessments of the buyer. Thus, as with consumer purchases, they are influenced by marketing appeals to the irrational needs of the buyer (e.g. ego, status, personal convenience, etc.) as well as to the practical needs of the company. In short, understanding and appealing to this very human decision-maker is where marketing shines! And accomplishing effective branding and positioning online requires that the marketer be facile with the full arsenal of online marketing tools as well as attuned to the many nuances of online messaging and positioning.
The Role of Search Engines in the New Buying Process
The tremendous surge in online commerce, and indeed the very power of the Internet to provide immediate and valuable information about all manner of product and services - is almost wholly attributable to the emergence of truly effective search engines. With billions of websites now available to buyers, finding relevant information quickly and easily is made possible only by Search Engines.
Search Engines' central role in the new online buying process cannot be overemphasized. This role is clear for online purchases (including site search capabilities offered, for example, by eBay). It is critical for marketing and sales professionals to understand that search engines are also the backbone of the offline purchase process. In fact, for offline purchases today, the lion's share of the process leading up to the decision to buy happens online. From educational research, awareness-building and branding, to requirements gathering, specification and risk mitigation (i.e. trust-building) search engines have become THE indispensible buying tool.
Is Dale Carnegie-Style Selling Obsolete?
But selling is still selling, right? Alas, the answer is an unqualified no - at least in the traditional Carnegian meaning of the term. Purchase behaviors have changed and the sales processes and (heaven forbid) selling skillsets must change too. Even the most skilled graduate from the Dale Carnegie School of Selling isn't worth a peanut shell if all the prospective customers are looking for "online relationships" instead of face-to-face ones. Not that Dale's lessons are no longer appropriate, they just have to be applied to the new online selling situation.
Implications for the Marketing Profession
The impact of the Internet on the marketing profession is perhaps even more profound than for the sales professional. For one thing, the "online relationship" is established almost exclusively by marketing programs and the web site itself. As with traditional offline marketing, online marketing initiatives build upon the foundation of a sound corporate strategy. But once you get past the abstract strategic thinking, to the part where the rubber meets the road, the actual knowledge, skills and tools required to effectively design and execute an integrated online marketing strategy represent a steep learning curve.
Many marketing organizations are unable to stay abreast of the ever-changing online marketing landscape and thus fail to take full advantage of it. The smart ones have either already invested the time to build their own internal expertise, or they have chosen to build a partnership with top-rated online marketing firms like StratiMind that specialize in providing a comprehensive set of online marketing services. At StratiMind there is a happy middle ground too - our highly collaborative approach enables us to provide informal training of your internal specialists concurrently with the development of online marketing strategy and programs. If you are considering hiring an online marketing firm then we urge you to take a look at some helpful tips on how to select an online marketing firm.
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