The digitization of the global business economy has been taking place at an unprecedented rate. Consider this. Approximately forty years ago, 83% of the market value of the S&P 500 were tied to tangible assets – physical products. Today, the complete reverse has happened. Intangible assets, such as copyrights, patents, training, procedures, data, digital innovations, and intellectual property, now comprise 84% of the market value of the S&P 500.
This startling transformation of the S&P 500 is just one snapshot of what is taking place globally. A new era of business will develop in the next 10 years that will fundamentally change how organizations work, conduct business transactions, and establish relationships. Largely driven by technology, we will see the digitization of nearly every aspect of the global business economy.
Such transformation will also redefine what it means to acquire buyer insights. The paradigm of buyer insights will shift and be reshaped by the forces impacting the global digital economy.
Escaping The Bubble
What we can be sure of is the buyer insights of the future will be fundamentally different from the buyer insights of the past. Many B2B firms today are either severely lacking in buyer insights or are led to believe the buyer intelligence they obtain is relevant to buyer insights. When in fact, the intelligence obtained have little to do with how businesses and markets are fundamentally changing.
B2B companies may have to come to grips with the fact they are living in their own digital information bubble. This includes an over-reliance on activity-based data intelligence mistaken for true buyer insights. For instance, the ability to gather data-centric intelligence on buyer search activity is expanding. However, it is intelligence that remains activity based regarding buyer activity on websites. Artificial intelligence can be applied to this intelligence and provide clues on how interests levels are shifting in real-time.
This is where it gets tricky in distinguishing intelligence from insights. Inside the bubble, intelligence is gathered to support predefined expectations around CX, account-based marketing, buyer’s journey, content marketing, content conversion rates, etc. Where success is oftentimes measured on how many downloads occur and the ability to identify real-time shifts in which content is accessed.
This also occurs on the level of the buy decision. Where intelligence, mistaken for insights, is rooted in outdated sales and product marketing precepts of buying teams, buying criteria, ill-defined success factors, etc. Rooted in the past as the world spins by them at a rapid pace. It is troubling to see in the world of buyer personas, for instance, many mistakenly created buyer personas representative of buyer intelligence rooted in the past. As opposed to being representative of true insights into the new era of business evolving today.
Buyer Insights That Matter For The Future
In a recent survey by PwC of CEOs, as well as, recent studies by KPMG and IBM, finds that over three-quarters of CEO’s surveyed (over 1300 by PwC) are concerned about the lack of insights about customers, buyers, and markets. Thus, it is fair to say that the mountain of data related to intelligence is having little impact on much needed strategic insights CEO’s need. Recent surveys (by McKinsey for example) also indicate that CEO’s are lacking confidence in marketing to apply critical commercial thinking to their businesses.
What type of buyer insights will matter as technological forces ushers in a new era of business in the next 10 years? What level of authentic buyer insights do CEO’s and their C-Suite need? Here are five areas of transformation CEO’s will need insights on:
Digitization of Products
While B2C has most of the buzz related to digital transformation, the impact is felt mostly in channels and distribution. For example, the physical properties of a book will forever remain the same. Yet the distribution channel of how consumers get a book has been radically disrupted through digital transformation.
Consider though the digitization of B2B industrial products will have a far greater impact on businesses than in any period in history. GE, as an example, is turning into a technology software and digital company as its machinery in several markets are supported by a term GE coined – a “digital twin.” These digital twins provide ongoing real-time data on hardware machinery performance related to uptime or downtime, operating efficiencies, and the likes.
CEO’s today will need to understand the B2B2C value chain as the digitization of products will ultimately disrupt consumers as well. Take, for example, Nike. They are supplied by businesses with digital abilities that enable them to then create digitized consumer products. Is a running shoe connected to an app that tracks miles and heart rates truly just a running shoe anymore? Or is Nike in the healthcare business?
How an organization’s product fits into the future digitization of businesses and the B2B2C value chain is what keeps CEO’s concerned.
Platforms and Communities
The expansion of the platform economy now taking place in the world of business continues unabated. Cloud-based platforms are dynamically reshaping how people interact, communicate, engage, perform activities, make buy choices, and make decisions. Disrupting the notion of what constitutes users and buyers as platforms create virtual independence whereby users, power users, and buyers may be fused into one.
B2B buyer insights CEO’s need is related to how to create open platform interoperability and how to create engaged platform communities. For example, John Deere’s platform strategy is turning their digitized equipment and machinery into a platform for managing crop production.
Developing Ecosystems
The digital revolution in B2B is creating new ecosystems. Ecosystems related to everything from how products are developed to how they are integrated into eventual end products are evolving. GE and NIKE today have far different ecosystems than that of a decade ago. Understanding new market ecosystems will become a source of critical buyer insights shaping informed strategies for CEO’s and their C-Suite. An inability to integrate into newly developing ecosystems caused by digital disruption will severely put a crimp on sustainability.
Business Models
Digitization and data are drastically redefining business models. Redefining how business transactions are taking place between organizations. Cloud-based digital technologies are disrupting long-standing norms of business transactions and market strategies. Transforming some industries from six-figure annual contractual transactions to two or three figure subscription-based business models. A good example is Adobe. Adobe has completely transformed itself by switching to a subscription based business model across the board. The business models of software, as an industry, are being drastically affected by digital transformation.
Collaboration
As new digital ecosystems develop, it increases the need for collaboration. Collaboration, however, is being redefined today towards trust-based relationships. B2B companies must rely increasingly on both internal and external partners to develop value chains in the digital economy that ultimately reach end users and consumers. Trust-based relationships are now centered around the amount of data exchanges that companies are willing to let take place. Making the degree of data exchanges and security key items on the negotiating table when organizations consider business transactions.
Insights Focused on The Future
The fundamentals of the buyer-seller relationship are being significantly transformed in ways unforeseen just a few short years ago. Requiring business entities to gather buyer insights that are future-oriented. The ability to adapt and sustain in the next ten years will be an overarching focus and a mission-critical aspect governing every organization.
The implications, specifically for B2B companies, is they will be required to distinguish between buyer intelligence geared towards measuring marketing and sales performance and future-oriented buyer insights. Both are needed and are interdependent to each other. This challenge now requires a transformation in how buyer insights are gathered, portrayed, and communicated to help B2B organizations create aligned strategic vision.
The difference in the next ten years will be quite dramatic. The entities that can recognize today they may be in a perpetual bubble of intelligence gathering and need future-oriented buyer insights will be able to sustain. Those who remain in the bubble will one day find the bubble bursting. And, find themselves in a world they do not recognize.
(The following is a video featuring George Westerman of MIT Sloan discussing the importance of effective leadership and vision when leading an organization through digital transformation. Effective leadership is informed leadership. Informed by buyer insights that guide a future-oriented vision.)