Think about the last time you made a big purchase. Perhaps it was something really major like a house or a car, or maybe something less dramatic like a replacement set of golf clubs. As you begin researching your purchase, your emotions are deeply engaged and, while you’re generally interested in making sure that whatever you are buying is within your price range, you’re focused on your needs. Is the house in the right location and big enough to do all the entertaining you’re planning? Can the technology in the new golf clubs compensate for a certain lack of technique, and you always needed a two-seater sports car anyway – right? You view the house, test-drive the car, or swing the club, and now you’re a little more focused on the details. You’re visiting schools, shops and other amenities in the area, making sure the house isn’t overrun by termites, and investigating the structural integrity of that extra room that was added last year. You’re reading the J.D. Power survey, checking the automobile insurance costs and considering the residual value of the car, all the while testing out the response to “Me? I drive a Porsche” in the singles bars, and wondering if Tiger Woods can drive the ball 300 yards with this club, is there any reason why you can’t. Now, it’s the time to make up your mind and sign up. “What, are you crazy – sign up to pay a prince’s ransom every month for 30 years, just for a place to sleep – you must think I’m mad! Why would I pay the price of a small house for a car that only has two seats? Maybe I should get a few golf lessons before I spend that amount of money on a set of clubs. I’m really not that keen on the game anyway.”
The buying process is a funny thing. People often use information and data after the fact, to rationalize the very personal emotional decisions made during the buying process. While this is certainly truer in personal consumer purchases than in the corporate buying process, it is important to understand the different legs of the journey that your customers will travel as they travel towards their buying decision. The emotional influences are still at play, even if they have been formulized or regularized through the corporation’s procurement process. They can be described as the four phases of the buying cycle.
THE FOUR PHASES OF THE BUYING CYCLE
All through the professional buying cycle, buyers are concerned about risk and the price of your offering. They seek evidence that you are the best supplier, and need to be assured that you can meet their needs. However, the buyer’s primary emphasis changes throughout the buying cycle and they focus on different concerns at different times. It is important to know where you are in the cycle and to understand what’s occupying the buyer’s mind at that time.
In a departure from traditional wisdom, we have segmented the buying cycle itself into four segments, to include Post-Sale activity for the sales professional. More than ever, a sales person’s key asset is his customer, and it is our belief that he needs to be involved after the deal has been consummated, to maintain the relationship. In the graphic here, we chart the relative importance of each concern through the process (a full black circle represents high importance).
The stages in the buying cycle are:
- Early in the procurement cycle, the buyer will briefly check on price to make sure your offering is in the general area of his expected budget. At this point, it’s all about his needs, his wants and his process. Getting past the first checkpoint requires that you pass the first features test. Can your offering meet the needs of the customer? If not, the price doesn’t matter. So far the customer has little risk, as no major irrevocable decisions are being made. This is the Requirements phase of the buying cycle. Your opportunity to shape the customer’s requirements is strongest in this phase of the buying cycle.
- Leaving the Requirements phase behind and entering the Evidence phase, the customer now requires very specific data from you to substantiate your claims that you can meet the needs that he outlined. You must prove to him that your solution is all it’s cracked up to be. As he invests more time, his risk is increasing but his focus remains pinpointed on your evidence. This will probably include detailed examination of your offering, reference calls to other customers, future support, product vision and more specific price discussions. Likely as not, the customer will reduce his list of potential suppliers at this time. It’s still like buying a car or a house. You’re down to a choice of two or three, all of which meet your needs, each with sufficient evidence to assuage your concerns about whether you’re getting everything you expect – but now you’re getting a little nervous.
- As the customer is making the final choice and is getting ready to sign on the dotted line, the purchase is at its most vulnerable, and the buyer is more nervous than at any other time in the cycle. Up to now, there is always a way out – but once the decision is made, it’s done, over, complete. Better not screw up now. This is where the professional sales person understands the need for positive reinforcement and a restatement for the buyer of the rationale for the buying decision, which hopefully has been arrived at jointly. In this, the Acquisition stage, all the work done up to now can be for naught if the buyer get butterflies and isn’t comfortable to proceed. Risk is uppermost in his mind, and price rears its head again. “So if I’m going do this, you need to give me a deal.” Sometimes the buyer needs something extra, or a price concession, to make him feel good about making the decision and to help him over the line. This is particularly true when one person will carry the responsibility for making the decision.
- Risk fades as a factor in the buyer’s mind after the purchase is made, only to be replaced by anxiety. As they say, the proof of the pudding is in the eating, and until the new product or service has been fully implemented and bedded in, the buyer will still feel vulnerable. You must address that concern if you want to maintain a long-term relationship. Post-Sale, the buyer no longer cares about price. Real evidence is needed to prove to him that he made the right decision. Work hard at it, and reward his trust.
Knowing the buyer’s perspective at each stage in the buying cycle, you can be extra conscious of the issues that will be to the forefront of his mind. You now have an opportunity to fully align your activities to the specific context of the particular buying phase.