Economic buyers: allies instead of disruptors
Economic buyers: allies instead of disruptors
Success factor Economic Buyer: involve from the start
Signing a contract yes or no - the economic buyer has the last word. Only those who win the final stage of the sales process can work towards their sales targets. This hurdle is only cleared once the customer's budget has been approved. Before that, the show can be over at any time: For Economic Buyers, weighing up the plans of different areas and reallocating financial resources with the utmost consistency is part of their daily business. They take a sober view and allocate the budget where they expect the most potential in terms of their responsibility for profit and loss. From a sales perspective, there is only one logical consequence: integrate the economic buyer success factor into the sales process as early as possible and work on it in a targeted manner.
Why should the focus be on economic buyers?
Do you have all the stakeholders who have appeared so far on your side? Then you probably also have a champion who is convinced of the added value of your offering. This person has promoted your solution internally and worked with you to ensure a positive attitude among employees from the application area and technical departments. In this way, you have already driven the opportunity forward and left the direct competition behind. However, you and your champion will have to pass one or more economic buyers on your way through the customer company's decision-making bodies. For example, you will face the sales department in purchasing or in a specialist management function.
Wanted: Definition Economic Buyer
If the final decision in this project is made, it will be for you. But whether it will actually be made is an uncertain factor. Will the divisional management approve the budget for your topic? Or do they perhaps see a much greater need for action in another area? This decision-making power is part of the definition of economic buyers. They can block budget releases with a veto, but they can also provide special budgets.
Whoever pays has the last word. It is clear that economic buyers have very specific requirements when it comes to decision templates. After all, they are judged on whether they manage the budget in such a way that it optimally serves the company's goals. Profit and loss are hard indicators. In practice, this means that Economic Buyers need to understand the added value of your offer at a higher level. They do not delve deeply into the topic, but focus on the business impact.
Example of sales software
Thanks to your software solution, the sales manager can finally relieve his team of the preparatory work for sales calls. More throughput of leads and a better approach, both of which contribute to his goals. Experienced members of the team don't see the negative aspect of having to get used to new software in the innovation. Instead, they already have the vision of being able to adapt even better to their counterparts in the future. Finally acting more freely and confidently on the front line! The technical integration of the new system into the existing infrastructure is also secure. Even when it comes to the sensitive issue of data protection, the legal department has nothing to complain about for once. The CFO is not yet familiar with the topic, but approval still seems to be a formality. Reason enough for the sales team to start chilling drinks for the post-deal ritual?
It is precisely in such scenarios that there is an increased risk that the drinks will remain standing for a little longer. In its CFO form, the economic buyer success factor has not yet played any role at all, although the process is already well advanced. Risky, because by definition, economic buyers are only too good at taking on the position of the person who spoils the game. After all, they manage budgets from an overarching perspective. For them, weighing up the initiatives of individual budget managers against each other is part of their daily work.
Ensure a high level of involvement via the sales process
Above a certain order volume, no deal reaches the finish line without the confirmation of one or more economic buyers. If the value threshold is exceeded, purchasing departments must approve your sale or the department hierarchy must officially release budget funds. If this is clear from the outset, why not involve the key stakeholders who have the final say right from the start? This is the only way for sales teams to actively address this success factor: Recognizing opportunities and addressing risks to the sales process at an early stage. This is the central idea behind the MEDDICC qualification methodology, which helps sales organizations to achieve greater and more stable success. When it comes to economic buyers, the first challenge is to identify them reliably.
1. identify
It all starts in the discovery call: salespeople need to find good access to their prospect as quickly as possible. Otherwise, important information for the progress of the opportunity will be missing. Many questions for the discovery call are therefore aimed at gaining a better understanding of the other person's role. Can the person become a champion for close collaboration? Budget authority is a sign of responsibility and influence. But how far is this really the case? It provides clarity when prospects guide salespeople through their company's purchasing process by way of example. This often reveals that the other person is working within a set budget and preparing decisions on the use of funds. However, the economic buyer is the person who finally releases this budget and can also act outside of the budgeted framework. You should not look too far up the hierarchy. Most decisions are too detailed for the CEO level.
2. establish contact
Sometimes the first contact on the part of the interested company is a direct hit. In other cases, contact with a champion can only be established subsequently. But champions are always the link between sales and the economic buyer. Champions are characterized by the fact that they have access to this hierarchical level. Salespeople must be able to count on this potential! When and in what context can the sales team contact economic buyers directly? What are the individual priorities and what motives are currently driving the person? Without this support, no successful contact can be made. If the sales team is put off, the alarm lights should go on. No purchasing decision without an economic buyer, no convincing decision proposal without early contact.
3. establish cooperation
If there is no collaboration with the economic buyers, there is simply a lack of input to make their own offer ready for a decision. As they operate at a strategic level, economic buyers take a different perspective than champions, for example, who have more of a connection to the operational business. There is no substitute for reliable facts:
How much does the offer cost the client company in total?
reached?
How long does the implementation take?
Are there risks and how are they managed?
In this phase, it is important that the sales team remains in its role as advisor. Economic buyers are not impressed by marketing phrases. What is the goal and how do they work towards it together with the champions? If you win over the economic buyer with well-founded communication, you will significantly increase your chances of securing the deal.
The economic buyer has the longest lever
As critical success factors for sales, Economic Buyers can make every phase of the sales process the last for the time being. That's their job! Every operational initiative competes for limited resources, especially time and money. Economic Buyers look at alternative courses of action from a management perspective. In doing so, they clearly prioritize according to strategic importance and financial aspects. They have to turn down some projects in order to make others possible. Even if the sales team outperforms its direct competitors, this does not mean the final contract is awarded. The race is only won when the proposal leaves no doubt in the minds of the economic buyers and the signature is placed. The best strategy: Integrate the economic buyer success factor into the sales processes right from the start.
