B2B Marketing Plan

Introduction to Revenue Streams
We hear the term "revenue stream" often.  A revenue stream is a method of creating and collecting revenue.  It's usually focused on a particular product or service.  

Underlying every revenue stream is the sales stages of a sales cycle.  A revenue stream consists of a target market for a particular product or service with sales stages to manage the transactions between buyers and sellers.

Sales stages are the seller's version of the transaction.  Marketing efforts engage buyers in buying cycles.  When sellers in sales stages engage buyers in buying cycles and transactions occur you have a revenue stream.  Sales stages are at the root of revenue streams.  The sales results from an operating revenue stream are shown in the sales funnel in the opportunity report.

How To Build a Revenue Stream
A revenue stream is another name for a sell-through campaign that runs continuously. It runs from target market to transaction.  Here's a working formula for building a revenue stream. 

Reach and Pull, Inform, Persuade, Close (RPIPC) 

This is a step-by-step strategy for building a revenue stream. 

1.  Reach into the market.
A business has a location from which it operates.  Marketing has to reach into the market to deliver the company's messages.  Your business needs consistent channels of communication into the market at a cost you can afford.  Identify a target market.  Develop your method of lead generation.  Create your marketing campaign and engage the market.

2.  Pull your market back in.
Once you reach into a market you need to pull the targeted companies back to your location.  After all, the reason we market is to pull people from our market into our business to share our opportunities.  Another term for "pull" is "response".  You get a response from your marketing and you capture the interest in the form of a sales cycle.  The sales cycle is tracked in your contact manager.

3.  Inform them about your opportunity.
You’ve reached into the market and you’ve pulled the audience to the location.  Now you have to inform them of your opportunity.  Sales presentations or demonstrations as well as marketing material are used to inform the market.

4.  Persuade them to buy.
We use selling tools such as product features, advantages and benefits to persuade our target market.  It takes helping relationships to persuade a customer to buy our products.  The sales process is a form of persuasion where we believe in our product and we assist in helping the market to purchase.

5.  Close transactions.
Closing a transaction requires transaction processes, product delivery methods, and inventory and customer service.  "Closing a deal" is a typical sales phrase that signifies the completion of a transaction.  Agreements, payment methods, policies and procedures are developed to close a transaction and create a customer.
If you perform the steps of Reach, Pull, Inform, Persuade and Close you will be building a revenue stream.

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Here’s a brief checklist for understanding your market.  When you build a marketing plan, your target market is central to the plan.  This checklist of items will give you a good guideline for researching and understanding your target market.

A. Buyer Behavior
Buyer behavior is a general description of the decision-making, psychological and social influences that affect what the consumer purchases.
1. Buyer motivation
Buyer motivation does not have to be high when purchasing a cola beverage but would have to be quite high to purchase a new car.  What level of buyer motivation is needed to purchase your product?
2. Consumer knowledge
Buyer knowledge is the amount of information and level of understanding the consumer needs to purchase the product.  Rate the level of knowledge a consumer has to have about your product to purchase it.
3. Group purchase decision
The product may require a group decision among the buying center for the purchase to occur.  Rate the likelihood of a group purchase decision.
4. Relative purchase amount
The amount of a purchase affects the frequency and amount of product purchases.  Relative to the average household income in your market, rate the dollar amount of the purchase of your product.
5. Average order size
Purchases and orders can be large of small, relative to the company.   Rate the average order size of an order of your product
6. Average frequency of purchase
Frequency is how often a product is purchased.  Rate the average frequency of purchase by your average customer.
7. Product purchase cycles
Cyclical purchases are purchases made at regular intervals due to a consistent need for the product.
Rate how cyclical the purchases of your company product are.
8. Negotiation and/or competitive bidding
Some products require negotiation or bidding to purchase instead of an off-the-    shelf purchase.  Rate the amount of negotiation and/or competitive bidding involved in the purchase of your product.

B. Consumer Attitude
Consumers develop attitudes towards your product.  There are either positive or negative attitudes the market develops over time.
1. Relative Advantage
The degree to which your product or innovation is perceived as better than an existing idea or product is termed relative advantage.  Rate the perceived level of relative advantage of your product in your market.
2. Compatibility
Compatibility is the degree to which an innovation is perceived to fit into a person’s way of doing things.  In general, the more compatible an innovation is with a person’s needs, personal values, beliefs, and past experiences, the more rapid its rate of adoption.  Rate the perceived level of compatability of your product in your market.
3. Complexity
Complexity is the degree of perceived difficulty of your product.  The more difficult an innovation is to understand or use, the slower the rate of acceptance by your market.  Rate the perceived level of complexity of your product in your market.
4. Trialability
Trialability is the extent to which your product can be used on a limited basis.  Products that lend themselves to limited use lend themselves to greater acceptance.  Rate the perceived level of trialability of your product in your market.
5. Observability
Observability is the degree to which other people can observe one’s ownership and use of a new product.  Products that can be seen, heard, smelled, etc. have a higher degree of observability.  Rate the level of observability of your product in your market.

C. Consumer Decision
The consumer decision-making process includes a number of steps that an individual or group goes through in deciding whether or not to buy a given product.
1. Product search
The amount of product search is the amount of activity the consumer has to engage in to find the right product.  A car purchase needs a greater level of product search activity than the purchase of a pair of running shoes.  
2. Purchase time
This is sometimes referred to as the sales cycle.  It may take hours to years.  
3. Level of perceived risk
Perceived risk is what the consumer believes can be lost if the purchase and use of the product become negative.  
4. Prior experience
Prior experience is the level of experience the consumer has had with the product.  Millions of consumers have experienced McDonald’s but relatively few have experienced the Sandwich Cafe in Bismark, North Dakota.  
5. Amount of installation    
Amount of installation is how much work needs to be done to install and/or use your product.  
6. Amount of behavior change
For example, purchasing a new accounting software package for a company requires a lot of change for a company whereas buying a new pair of shoes requires little behavior change for a consumer.  

D. Market Demographics
For the consumer market, demographics are vital and social statistics, such as of the births, deaths, diseases, marriages, etc., of populations.  For the organizational market, demographics are statistics such as type of business, number of businesses and employee size.
1. Population size of the market
The population size of the market is the number of consumers or businesses in the market.  
2. Age range of customers
The age range of the customer is the age of the consumer or the age of the business.
3. Geographic location
Geographic location is the geographic area the consumer or business is located.
4. Income range
Income range the amount of personal income of the consumer or the revenue level of the business.

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The marketplace needs good sales people. While the stereotype of the slick salesman still exists, professional sales people break the stereotype. The difference between a professional sales person and a huckster is strong character traits and ethical behavior. When a buyer engages a professional sales person the buyer most often comes out the winner.

Sales people create awareness, provide knowledge and education and decrease the time and energy required to make a buying decision. Professional sales people work hard to provide a good service to the customer. The stereotypical sales person is missing key attributes of the well-liked sales professional.

A recent study by the Harvard Business School found that successful salespeople do not take "no" personally; take 100 percent responsibility for results; possess empathy; have above average ambition, and willpower and determination; are intensely goal-oriented; and can easily approach strangers (BASIS International, 2002).

In addition, the study found that knowing how to sell effectively is not always second nature; these attributes can be learned and incorporated into a personal development plan for reaching top seller status.

Authors Patton and Sardar (2002) define five related qualities that they feel describe a successful salesperson: high energy level, self-confidence, and hunger for money, well-established habits of industry, and the ability to see obstacles as challenges. They believe that top sellers possess a compulsive need to win and hold the affection of others.

In the article, What Makes a Great Salesperson? Links Between Our Heritage and the Future, by Sardar and Patton (2002), the following attributes were listed: 
• job commitment
• strategic orientation
• intellect
• mental alertness
• sociability
• authoritative
• dependability
• persistence
• courage
• ability to improvise
• inquisitiveness
• good listening skills
• empathy
• straightforwardness

In the article "PAs Examine the People Who Sell to Them," (Sales and Marketing Management (November 11, 1985) character traits most valued by customers in sales people were identified as:

Most Valued    (percentage)
Reliability/credibility                              98.6
Professionalism/integrity                        93.7
Product knowledge                              90.7
Innovativeness in problem solving         80.5
Presentation/preparation                       69.7

Sales people hone their instincts about people and situations. Over time, the sales process becomes inherent and sales people perform at a gut level to set the direction. Instincts such as these are invaluable and are to be nurtured and respected. Good sales people also learn to have no fear. They learn to handle rejection and turn constraints into opportunities. No one likes rejection, but learning to manage it is a skill in and of itself.

Sales people also need good analytical skills. They need good research skills to find out about their prospects and know and understand their needs, their business, their business structures, etc. These skills can be taught, but experience in digging up the necessary information is helpful. They need good communication skills. They also need to be good communicators. The majority of what a sales rep does involves communication -- both written and verbal. Also, technical skills are important. They have to be familiar with the basics of word processing, spreadsheets, PowerPoint and maybe the fundamentals of relational databases.

Top Performers
Professional sales people separate themselves from the stereotype. Top Performers separate themselves from the crowd and reach peak performance and earnings in the profession of personal selling. Top performers have higher gross sales, better gross margins, more profitable customers and a lower attrition rate than other sales people. Top performing sales people have natural talent and ability. That's not to say that all top performers are born not made. That's not an argument for this course. Top performers apply their talents consistently and intently. Here are some of the primary performance aspects of top performing sales people:

1. Lead Generation.  Top Performers generate new leads to fill their pipelines. They network, prospect, cold call and prequalify on a continuous basis. They realize they can't rely on others to build their market. They learn to sort the markets for the right prospects for them.

2. Time Management.  Top Performers understand how to use their time wisely. Top Performers manage their inventory of time. They know when to spend it and when not to. They don't waste time on leads and prospects that aren't in a mature buying cycle.

3. Staying On Plan. Top Performers realize most leads, prospects, customers and fellow employees have their own agenda and want to get the Top Performer to do their bidding. Everyone wants Top Performers on their plan - not on the Top Performer's plan. The Top Performers knows when to say no to things that aren't beneficial.

4. Investing in the Cycle. Top Performers invest in the sales cycles they choose to work. They do their research and reading. They learn about the leads and prospects in order to serve them the best. They treat each cycle in a unique fashion to hone in on the solution that's needed. They give of themselves in order to sell in the most beneficial way for both parties.

5. Honor. Above all, Top Performers sell in an honorable fashion. They know what comes around goes around. By always performing in an ethical and empathetic manner, more opportunities will come their way. To sell with honor and dignity requires sacrifice and maturity. Top Performers don't question the decision. They know it’s often better to make things right than to be right.

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Your current customers are generally your best source for revenue. You have a relationship with them. You can contact them with new information and new opportunities. To maximize customer marketing your processes need to be top notch. Your customer service needs to be excellent.

This assumes you know which customers to market to. This module discusses the process for selecting a customer database for marketing purposes.

Market your products to you customers if you want to survive. It’s a tough lesson to learn and you don’t want to learn it the hard way.

If you have an existing business or if you are starting a new business you are no doubt going to learn a lot about customers. Talk about the importance of customers is abundant. Businesses are always in a transition phase with customers as the customer base rises and falls.

It costs eight to ten times more to create a new customer than it does to keep a customer. If this cost of marketing doesn’t impress you nothing will. Customer marketing is your most lucrative source of revenue.

The Values of a Customer

The foundation of all marketing is the value of gaining a new customer. Many values come from a customer base. I have found most companies completely underutilize their customer base. Relationship capital is a new term you should look up on the Internet. It’s the thing.

Here are several positive values to a customer relationship. Make a list of the customer value you are capitalizing on in your marketing.

1. Financial Gain of a Transaction
Revenue produced from a sale to the customer
Costs of selling to the customer
Profit margin of the sale

2. Payment and Terms
Payment performance of the customer
Terms of payment of the customer

3. Future Gains
Frequency of purchases by the customer
Amount of purchases by the customer
Profitability of the purchases of the customer
Exclusivity of the purchase commitment from the customer
Five-year value of the customer

4. The Customer’s Company
Location of the company
Size of the customer’s business
Financial stability of the company
Reputation of the company
Market exposure gained by the company
Market stability of the customer’s industry

5. Marketing Relationship Potential
Sphere of influence of the customer
Good word of mouth advertising from the customer
Cooperation of the customer on a marketing level
Potential for coop advertising or cross promotion
Quality and size of customer database of the customer’s company
Customer profile of the company’s customer
Symbiotic, competitive or unrelated product line
Marketing needs of the customer
Future marketing relationship potential

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I continue to meet companies using static websites for their corporate website.  A static website doesn't provide two-way interaction.  It's basically an electronic brochure.  Web visitors and view but not interact. I call these websites "Presenter" websites.

As I talk to business owners they are still of the opinion that they if they build it people will come.  Nothing is farther from the truth.  The Internet has billions of pages and its way too easy to be lost in the shuffle.

All websites should have some form of two-way interaction.  The simplest thing to provide is a contact form.  It allows site visitors to put their information into the form and send it to the company.  It's also easy to put a form up for registering for a newsletter or new product information.

Here's my classification system for websites.  I recommend companies build nothing less than a Generator site.

Presenter
The Presenter website is a one-way, static site.  There is no interaction possible between the site and the audience.  It can present your corporate identity and product identity on your Web site.  Presenter Pages are not dynamic, interactive pages in and of themselves.  It is designed to inform and persuade.  Showcase your products with product descriptions, facts and pictures. Provide contact information for new customers

Benefits of a Presenter Website:
• Creates a web presence
• Provides a Corporate Identity
• Provides Sales Literature
• Provides Contact Information

Generator
Generator websites are interactive websites with two-way communication between the site and the audience.  A generator site will have forms of some type for people to enter and receive information.   A site that asks you for your email address in return for a newsletter is a generator site.  There are many forms of interaction possible on the Internet.  Chat rooms, forums, directories, newsletters and surveys are some of the methods.   Generator Web Pages are essential for lead generation with your Web site. 

Benefits of a Generator Site
• Provide information to the audience
• Receive customized information from the audience
• Qualify potential customers
• Revive information from customers

Transactor
The Transactor is a Web site capable of completing product transactions online.  It has all the features and benefits of the Presenter and the Generator. It’s a robust site with full database and E-Commerce capability.  It’s built for full business capability online.  It adds a transaction closing function to the marketing strategy.

Benefits of the Transactor Web Site
• E-commerce transactions capability online for selling products and services.
• New revenue opportunities
• Open new markets online
• Integrate your traditional selling methods to add more customer service.

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Sell Benefits

It’s often said that people buy a product because of its benefits.  Business owners and marketing managers become very subjective about the benefits of their product.  They are the zealots who think everyone should own their product.  However, from a marketing perspective, target markets need to be told about the benefits of a product.  It’s important to identify the benefits of a product and create messaging to explain the benefits clearly and concisely.

Hugh Rank’s Intensify/Downplay Schema (http://webserve.govst.edu/pa/Schema/intro_s.htm) model identifies many different intrinsic values of products.  Intrinsic values are the things about that product that are most beneficial to the customer.  They are primary characteristics people respond to.  The more you can associate your product to the positive merits we favor, the more products you can sell.

Explanation of the Intrinsic Values

1.  Quality
Quality refers to the intrinsic value or characteristics of something.  If something is of “high quality” it’s better than every thing.  If something is of “superior” quality it is the best.

2. Efficiency
Efficiency refers to those words and images which emphasize ability and effectiveness of the product or service: Does it work? Can it do the job? Strength and effort are often related to efficiency.

3. Stability
Stability refers to those words and images which emphasize the favorable aspects of the past, of conserving older things, of tradition and heritage. 

4. Utility
Utility refers to those words and images which emphasize the usefulness and the versatility of the product or service, usually as a means to do something else. Tools and trucks are perhaps the most obvious product examples here, but many other items -- such as clothing and furniture, computers and electronics -- also use make such claims of usefulness of the product.

5. Quantity
Quantity refers to those words and images which emphasize a large number, amount, or variety -- in size, space, time, styles. The emphasis is on plenty, abundance ("more for your money"), often leading to a very common idea that "bigger is better."

6. Scarcity
Scarcity refers to those words and images which emphasize that which is rare, infrequent, or in limited supply. Scarcity is often clustered with an urgency appeal: "Hurry... only a few left."

7. Reliability
Reliability refers to those words and images which emphasize the predictability and sameness of a product or service. Such reliability can relate either to time (same results from repeated use) or to space (same qualities in all the parts).

8. Rapidity
Rapidity refers to those words and images relating to the speed of a product or service. In most cases, a fast rate of speed is desirable, especially when the product is a means to an end: quick headache relief, fast airline travel, fast food service. However, in some situations, a slow rate is desirable and appropriate, especially when the product or service is an end in itself: a leisurely ocean cruise, an elaborate restaurant dinner, a spa, a quiet vacation.

9. Beauty
Beauty refers to those words and images which are used to emphasize the delight and pleasure provided by the beauty of the product. Definitions and criteria of beauty may vary widely. It's subjective, "in the eye of the beholder."

10. Novelty
Novelty refers to those and images which emphasize the originality or newness of a product or service.

11. Simplicity
Simplicity refers to those words and images which emphasize the ease or uncomplicated aspects of a product or service. The emphasis is on being easy and effortless.  It’s not only about buying the product buy using and maintaining it.

12. Safety
Safety refers to those words and images which emphasize the safe and harmless qualities of the product itself, or in using it.

13.  Communicability
Communicability is the degree to which the benefits of a product can be talked about.  Some products are high risk and people use them but don't talk about them.  Other products are too complicated to discuss.  The easier the benefits of a product are to discuss the more it benefits a buying cycle.   

14.  Familiarity
People tend to like things they are familiar with.  In general the more the market is familiar with the benefits of your product the easier it is to sell. 

15.  Observability
Observability is the degree to which the benefits of a product can be observed.  Some products are easily observed such as a hair cut or a new suit.  Therapy sessions will not generally yield easily observed results.  People tend to like things they can see.

16.  Predictability
Predictability means that the user’s knowledge of the product is sufficient to determine the result of his/her future interaction with it.  The more predictable the benefits of a product the better.       

17.  Trialability
Trialability is the ability of a product to be used prior to its purchase to determine if the perceived benefit can be derived from the product.  I can take a car on a test drive but I generally don't get to try out a house before I buy it.

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I come across articles from time to time about telemarketing being a poor choice for lead generation.  "Cold calling doesn't work!" I recently embarked on a new marketing campaign where cold calling is used in conjunction with direct mail.  The campaign is getting terrific results.  I'm not sure where telemarketing naysayers get their information but they aren't running their own B2B  marketing campaigns that's for sure.

We're actually making content with our target market more than 20% of the time.  For every 10 companies we call we reach the selected person twice. The target market is companies with 100 employees or more.  Not an easy group to reach.  A 20% response rate is not bad for any type of marketing.  I'm sure there are people who will make claims of a 40% or 50% response rate.  I'm just saying I'm happy to take a 20% response rate anytime I can get it.

Of the leads contacted, approximately 50% respond favorably to the offer.  They either agree to exchange information or a sales appointment is made.   The other 50% are the "not interested" crowd.  What I call cold leads.  They aren't interested today but they may be in six months.

I send a direct mail letter to the leads first.  Then I call them.  Inevitably they go to a website to verify we're telling the truth.  This mail / phone / web strategy is a killer.  Telemarketing is the heart of the campaign.

Telemarketing isn't for everyone.  It won't work for every company.  If you are the type of company where telemarketing can be used I would definitely put it in your B2B marketing aresenal.

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Hello and welcome to the B2B Marketing Plan blog.  I've been a self-employed entrepreneur since 1985 and a marketing and sales consultant since 1990.   I've learned a lot after 24 years in the business trenches.  The blog covers all aspects of marketing and sales and is based on my day-to-day experiences with clients, prospects and the bumps and bruises of business. 

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