What B2B Sales Can Learn from a Knockoff Cereal Company?

I love Malt-O-Meal cereal. If you don’t know about the company, it makes hot and cold cereal and most of its products are perfect knockoffs of brands sold by industry leaders like General Mills, Kellogg and others. I have a sweet tooth, so I only speak about (cold) cereal varieties that run really high on sugar. Here’s what I like about Malt-O-Meal cold cereal:

• Tastes as good as the original brand
• Large bags are great value for money
• Saves time with less trips to the store
• The bag comes with a zipper that keeps it fresh

Why does all this matter? Well, over the years, Malt-O-Meal (MOM brands) has been eating into branded cereal revenues while benefiting from millions in advertisements spent by bigger companies. On the other hand, Malt-O-Meal spends almost no money on advertisements, but that’s only part of the reason for their success. MOM’s marketing genius lies in their ability to understand what’s valuable to their customers and creating a winning differentiation on the product packaging side. They perfected the packaging so well that the “originals” were forced to copy the large bag strategy and sell similar size packs.

Malt-O-Meal is not the only one that has benefited from perfecting product packaging that is attractive and valuable to the customer. Take, for instance, India’s CPG market (called FMCG in India), where low unit packs (LUPs) have been a runaway success in the past two decades. The “small packs” are available in almost every category from shampoo, detergent and cosmetics to biscuits, cooking oil and noodles. Most of these small packs cost from 1 to 20 rupees. For context, 20 Indian rupees is just over 25 cents. These products are popular not just in the rural areas, but also in high population urban centers.

Whether the packaging is large or small, the idea remains the same – deliver value to the customer by understanding their needs and offer the product in the “right size” package to meet their exact requirements (and budget). This in turn saves the customer time, money and effort. The LUPs started with sachets for shampoo, oil and biscuits from early disruptors who deeply understood their customers and wanted to find solutions for people in the lower strata who couldn’t afford bigger packs.

Initially, LUPs were driven by understanding of the customer at the grassroots level, along with a lot of trial and error. Since then, billions of “small packs” have been sold across categories, and now there is an immense amount of data that is used to understand specific customer needs. All new product sizing decisions are now made by analyzing this dataset. The LUPs have now become a highly data-driven segment, for good reason. Product volumes in this segment are high, but margins are low. The new product packs are launched based on analysis of existing product and market segments, as well as changing consumer preferences and behaviors.

B2B Sales: Right-sized Solutions

Selling in business-to-business (B2B) is no different when it comes to delivering a right-sized solution. A significant number of vendor bids are thrown out of contention because they either over- or under-size the requirements. In effect, they are sending a clear signal to the customer that they have minimal understanding of their needs. No B2B customer wants a tactical vendor. Customers want a strategic partner who would invest time absorbing the universe they live in; a partner who would actually inform them on what exactly their needs are.

Most B2B customers have a limited understanding of their actual needs and little knowledge of what solutions would address those needs. They might not say it aloud, but customers rely on their solution partners to understand their needs – hopefully, better than they do themselves – and build a future-proof solution that is perfectly sized for their needs.

Many salespeople say that the ability to make a sale is more an art than a science. While it holds true for some aspects since appealing to customer emotions and perceptions is important, as is building good relationships, it has limited overall impact. Sales must zoom out to look at the bigger picture because data plays a much more important role than sales teams would readily acknowledge. Sales has been extremely behind in using data analytics to improve the sales process. On the other hand, customers today are largely making decisions based on data and numbers. So, romanticizing about the ability to woo customers with “selling skills” results in limited success, if any.

B2B sales are rapidly evolving and must start leveraging data to increase sales volume and closure times. Barring new and small firms, B2B companies have a large amount of customer, market and request for proposal (RFP) data that’s either sitting in people’s heads, or some kind of system of record (ERP, CRM, Bid/Knowledge Management, etc.). There are hundreds of data points such as: industry segment, customer type, size and location, business functions involved, stakeholder names and roles, business processes touched, dollar value, competitors in play, technologies used, products and solutions offered, won/lost reasons and much more.

This data helps sales teams understand what worked in the past and generate insights to steer future sales efforts. It improves decision-making in all aspects of a sales pursuit, but more specifically, can shed light on two important areas when it comes to offering the “right size” solution:

1. Understand customer needs. Since many of the customers have similar challenges and needs, they can be categorized and analyzed to help identify commonalities and patterns. Future customers can be mapped to this dataset to quickly build a “customer needs profile” that can be further enhanced with on-the-ground account knowledge and past sales experience.
2. Offer a solution that exactly meets those needs. Customer requirements can be mapped with past requests to identify components of similar sales pursuits, whether won or lost. It is of great value to be able to look up what mix of offerings worked well for similar requests from comparable customers. These insights can help sales teams pitch a “right size” offering for the current customer request.

Let’s face it, it’s hard for a salesperson to control their innate (over) selling instincts; the constant battle with the DNA is brutal! The ones who win this battle come out ahead. Overselling is a disservice to the customer and leaves a bad taste. The focus should be on serving the customer’s current needs and delivering value. Sooner or later, there will be opportunities to upsell.

Again, analytics can play a critical role in upselling by identifying influencing factors, such as current trends, purchase history, customer interests and others. These insights enable sales teams to use data analytics to ensure that they always have something of value for their customers, even when upselling. But, at any given moment, sales teams should always remain focused on delivering the “right size” package to solve immediate customer needs.

Overselling, underselling and inability to create a “right size” package is one of the leading causes of sales failure. B2B sales teams must leverage insights from past data to better understand the needs of their customers and propose a solution that exactly matches their requirements. Only then, the sales team would be able to speak the customer’s language and deliver value they seek from a partner.