These days, there’s a lot of talk using big data to drive sales. According to this line of thinking, your sales and marketing teams had better be using big data to analyze opportunities, or else you’re sure to be losing out to competitors who do.
There are compelling examples of the power of big data for big companies. In recent years we’ve heard how Target knew a teenage girl was pregnant before her father did, how data prompted Netflix to create House of Cards, even how the Canadian government is using big data about prescriptions to identify drug abusers, among other things.
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But when it comes to small and mid-sized B2B companies, I disagree with the fad. The promise of big data seldom holds true for small and mid-sized B2Bs, and focusing on big data is a dangerous premise for them.
The reason? Because the data simply doesn’t exist. The majority of small and mid-sized B2B companies do hundreds or thousands of transactions a year, not the millions that are needed to conduct meaningful data analysis. Focusing on number crunching can also blind companies to the much easier route to customer insight and profit: asking them.
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I’ve seen entrepreneurs, sales people and inventors extract phenomenal value from a few discussions with potential customers. The small details and pieces of knowledge that they elicit from those conversations become the basis for new services, pricing models and delivery processes. You don’t need to spend hundreds of hours crunching data to get to those basic insights. Just take the time to have conversations with customers and potential customers, and then translate what you hear into something new for your company rather than ignoring what you’ve been told.
Here’s an example: as part of providing outsourced marketing services, my company was helping an engineering firm prioritize their target markets and articulate their value proposition. To get answers to those strategic questions, we briefly considered doing a quantitative market assessment. But our client is relatively small—about $10 million in revenue—and we were not sure we’d have confidence in decisions coming from a quantitative assessment, which often feel superficial.
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What they did have was some 100 customers and prospects who were deeply knowledgeable about our client’s and competitors’ products, and who were happy to share their views and experiences. So rather than a quantitative survey, we conducted 15 qualitative interviews with customers in different markets. ‘Qualitative interviews’ is a fancy way to say ‘conversations,’ a series of 45-90 minute phone calls.
The conversations were structured, although our interviewees probably didn’t feel that. Although we had a list of information objectives and specific questions that we wanted answers to, we held the conversations in an organic way that was enjoyable for the interviewee.
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That yielded much better insight into how they make buying decisions than any canned quantitative survey could. After each interview, we carefully captured our notes and built a database (a fancy way to say ‘Excel spreadsheet’), which categorized the comments we’d received and helped us evaluate the conversations in aggregated.
From that relatively simple process we learned which situations these customers needed our client’s products in and what value those products provided. This knowledge translated directly into identifying the most lucrative markets for the company and determining how they should pitch their products.
My advice is simple: don’t get lead astray by the promise of big data at the cost of simple insight. If you’re in charge of sales and marketing at a small or mid-sized B2B company, you can safely ignore big data. Focus instead on smaller samples and a more basic approach. For insights that will help you market well, pick quality over quantity every time!
Lisa Shepherd is author of Market Smart: How to Gain Customers and Increase Profits with B2B Marketing and president of The Mezzanine Group, a business-to-business strategy and marketing company based in Toronto. She was the youngest female CEO of a company on PROFIT’s ranking of Canada’s Fastest-Growing Companies in 2007 and 2008 and is a frequent public speaker on B2B marketing strategy and execution.
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Is Big Data part of your sales and marketing strategy? Has it produced results? Let us know using the comments section below.