Visualising the B2B Value Landscape

The Marketing Landscape

One of our most important learnings over the last couple of year has been developing a clear understanding of the way B2B technology firms analyse, create and describe value.  This can be summarised briefly as:

Value creation typically flows from industry value analysis, which determines where you can best create customer value and value relative to the competition (relative value).  The value you create accumulates as brand value.

In this article, I am going to expand on what is in each of these elements, starting with a picture. 

B2B Value

This has inspired many Marketers and explains the reference to the beach.  

This is Marketingland, a graphic created by a class of Mark Ritson’s Marketing mini MBA, who formed The Proper Marketing Club.  It shows a journey from the toil of market orientation and research to reclining on the brand beach with a cooling beverage. There is much to like about this depiction of Marketing:

  • It clearly and easily explains the three main stages of creating a Go-to-Market motion: diagnosis, strategy, and execution.
  • The often neglected research twins – Quantitative and Qualitative, make a welcome appearance in diagnosis.
  • The classical elements of strategy: segmentation, targeting and positioning take centre stage.
  • The 3Cs model (company, competition, customer) is used to describe positioning. We, like many others, have found this model to be extremely useful. Corporate Visions’ implementation, described in Conversations that Win the Complex Sale, is particularly impressive.
  • There is clear signage that points out the error of starting with promotion or product, both of which are still surprisingly common errors.
  • The use of a beach metaphor for brand as a highly aspirational destination is inspired.

A Broader Audience, and a Simpler Picture

Marketingland was inspired by the work of a marketing professor and was designed by marketing professionals for a marketing audience.

Our work includes Sales and Product teams in several of the activities depicted in Marketingland, which would be less effective as a roadmap than for a Marketing audience. This takes us to the inspiration for the second picture – one I now use to visualize the value creation landscape.

When re-reading Roger Martin’s excellent and highly recommended Playing to Win, I saw a parallel to the journey depicted in Marketingland in his Strategic Logic Flow.  

“Ultimately, there are four dimensions you need to think about to choose where to play and how to win: 1. The industry. What is the structure of your industry and the attractiveness of its segments? 2. Clients. What do your clients value? 3. Relative position. How does your company fare and how could it fare, relative to the competition? 4. Competition. What will your competition do in reaction to your chosen course of action?” 

The result of these four stages is to arrive at a strategic choice based on selecting a matched pair of where to play and how to win. 

As relative position analysis is essentially the same work as relative value analysis it struck me that we could use the first three stages of the Strategic Logic Flow as the route to brand value.

Here is the image we use to visualise the B2B value landscape:

B2B Value

Industry value is represented by the choice of wave, while relative value is your position on the wave. Customer value is represented by the surfboard, which conveys you to the brand beach as you fulfill the customer’s need.

Industry Value

Breaking down the elements of each of those three stages, Industry value is developed from the post-diagnosis work of segmentationtargeting and profiling.  

It’s interesting to note that the concept of industry value was dubbed ‘value innovation’ in Chan Kim & Renée Mauborgne’s Blue Ocean Strategy.

“Value innovation is the cornerstone of blue ocean strategy. We call it value innovation because instead of focusing on beating the competition, you focus on making the competition irrelevant by creating a leap in value for buyers and your company, thereby opening up new and uncontested market space.”

Relative Value

For those who can make it work, this is a fantastic strategy. However, as uncontested market space is vanishingly rare, relative value, that is your value relative to your competitors, is essential. This emerges from competitive analysis and positioning.

We’ve done a lot of competitive analysis work with value curves, which you can read more about in the article How to Assess and Compare Your Value Against Your Competitors Using Value Curves on B2B Navigator.com.  

Customer Value

The cornerstone of customer value is your value proposition.  This can be broken down into a set of components, which makes development significantly easier.  That is a substantial topic in itself, which we will cover in another article.

In addition to the value proposition, to fully describe and deliver customer value, there is a  supporting cast:

  • Needs assessment
  • Outcome and TCO measurement
  • Pricing and product strategy
  • Customer Experience optimization

Given that two of the components of a value proposition are a need and an outcome, it is surprising to us how neglected these first two elements are…

Brand Value

Given sufficient industry, relative and customer value we accumulate brand value.  Whole books have been written on the topic of brand value, and we respect the fact that brand value can be created by branding work in ways quite distinct to that which we have described here – it is more than a destination.

However, keeping things simple, if we know where to play and how to win (which is the result of what we’ve described so far) we will win business and build the brand as the business grows.   This is what accumulated brand value means to the business: 

  • Enhanced awareness
  • Dominance in RFP engagements
  • Premium pricing power
  • Enhanced employee engagement and recruitment
  • Ease of facilitation for new business partnerships and alliances
  • Higher Return on Marketing Investment (ROMI)
  • Cool beverages on the brand beach….

We’ve found this a useful way to describe the benefits of a strong brand for an audience of Sales, Marketing, and Product teams that are busy bringing B2B technology products to market and that are not involved in branding work.

Conclusion

Marketingland points out the proper starting point is extremely important – and that it is nowhere near the brand beach. The Value Surfing picture shows something very similar but focused on value definition and development.

You can be the best rider on the best board but if you don’t choose the right wave and get in the right position on that wave, you won’t make the brand beach.