The goal of market segmentation is to identify, prioritize and target groups of customers with similar needs and buying behaviour - in order to simplify marketing, sales, support and pricing. These distinct target segment(s) will have similar responses to the value proposition of an offer. Firmographics though easy to observe, fail to link customer segments to how a customer derives value from an offer and why they buy.
Value-based market segmentation segments the market into customer groups who derive economic and emotional value the same way, and who therefore can be marketed and sold to in the same way. While appealing to emotions may seem intuitive within the B2C environment, there are often questions around whether emotional value creation really matters within the B2B environment. That is, is there room for emotions if it is “just business”? Yes, emotions are central in B2B.
Whether the B2B buying process is a content marketing driven inbound process, or a high-touch environment comprising of multiple touchpoints with stakeholders and influencers within the organization the emotional response shapes how people respond to information. Within such complex decision-making processes, involving several individuals, purchase decisions are not simply based on the features and benefits of an offer. The “decision-making unit” comprises of individuals (e.g. C-Suite, Operations, Sales, Finance, Procurement) who are expected to make decisions in alignment with organizational goals, but these decisions are also made within the context of their personal satisfaction and success criteria.
Maslow’s hierarchy of needs outlines the different ways emotional value is created for individuals. The higher up Maslow’s hierarchy of needs an offer can resonate on the individual level, the more pricing power a seller has.
High-touch B2B sales environments provide multiple opportunities to make a case for how an offer creates both economic value (impacting the organization’s top and bottom line) and emotional value (resonating on a personal level). Based on an understanding of the audience and their success metrics, the seller can choose to lead with communicating the emotional or economic value of the offer.
Emotional value can also be created by making the the interaction with the seller a pleasant experience for the customer. Ideally, each interaction, or touchpoint, should demonstrate the value proposition, reinforce brand attributes, and provide an opportunity for feedback and engagement. The customer should be able to understand exactly how an offer addresses their needs better than the next best competitive alternative, and the price should reflect how the customer derives value. Honest value communication and transparent prices that make buying and accounting easy for the customer, can be a value-added experience within complex B2B sales environments. This can go a long way to mitigating customer pushback, managing procurement, and in many cases even increase willingness to pay (WTP).
While you cannot sell on emotional value alone within the B2B context, emotional value creation does play a pivotal role in purchase decisions and should not be discounted. Because, there is no such thing as “just business.”