Why is this important?
As mentioned earlier, the whole point of a business is to satisfy market demand. When seeking to understand a business, it is therefore helpful to start by figuring out what they are selling, and to whom. By doing so, you are actually stepping into the shoes of an entrepreneur. For an entrepreneur the most crucial skill is being able to identify, out of all the needs in the world, the ones that are potentially unmet, and to segment the market into a group of potential customers who share these needs, and can be served.When you start thinking about the your client's business model, it is helpful to distinguish businesses who sell to individual consumers ("B2C" businesses) from businesses who sell to other businesses ("B2B" businesses). Of course, a company can serve both types of customers, but there are some important considerations unique to each type of buyer.
Selling to human beings ("B2C")
Consumers are human beings, and human beings have human needs. Some needs are tangible, and shared by all: Food, shelter, safety. Some are more abstract, but still shared by all: the need to connect, the need to belong, the need to achieve. But as you layer up the wonderful diversity of taste, experience, and circumstance onto the base human condition, those underlying needs manifest in more and more specific ways, and so we have a demand for a particular shade of lipstick, a particular style of shirt, or a chatbot with a particular sense of humour. Businesses who sell to customers are catering to these needs, whether directly or indirectly.If your client sells to consumers, where are they? How old are they? How much do they earn? As you drill down further and further, you can start to define a very specific, representative customer persona. This is where things get really fun: having described an archetypal customer in vivid and intricate detail, you can take that persona through what marketing professionals call the customer journey. This means imagining, step by step, how that person's need for the product arises, becomes a conscious desire, followed by awareness of a product, and finally a decision to buy. Smart entrepreneurs, marketers and product designers actually extend the customer journey, and continue to model the consumer's experience all the way through the lifetime of the product, or the duration of the service, so that they can plan for the eventual renewal, upsell, refill or replacement. As I have said several times already, business exists in the real world, and the more you understand the lived experience of the consumer, the more detailed and accurate your understanding of them, the better your intuitions will be about your clients who sell to them.
Selling to businesses ("B2B")
Businesses also have needs. Just as with human needs, these may start out from some underlying commonalities but will manifest as incredibly specific requirements. But however complex or unique a business might seem, what all of them have in common is that they want to increase their revenues or decrease their costs. Business who sell to businesses are trying to help their customers raise their revenues or reduce their costs, either directly or indirectly.A slightly different set of intuitions is useful when selling to businesses, as opposed to individual human beings. First is to understand that the decision to buy is probably slower, more deliberate, and more complicated. Why? One reason is that purchase decisions are important: they impact revenues or expenses (or both), and therefore are subject to some sort of risk management and safeguards (usually some sort of approval process). Another reason is that many more people are involved. For any major decision there will be a formal or informal "buying group," which might include finance, compliance and risk, as well as the purchasing or procurement department, in addition to the actual department who needs to use the product or service being purchased. On the other The second is business purchasing decisions are likely to be "stickier": Once a vendor has been vetted and selected, there is a bias toward continuing to purchase from them. Business organisations are generally long-lived repeat players in their industry. Purchase decisions may be as much about the overall relationship with a seller, as about the economics of a particular sale. So, I believe that one of the first things you should do when learning about a new corporate client is to look at their key customer accounts, and think about those vendor relationships in the context of the industry.