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The buyer-centric revolution

Posted on: Wednesday 25th of August 2010



Sometimes something is so obvious you don’t need to give it a second thought. It’s obvious for example that the sun orbits the earth and it’s obvious that the marketing is something that’s done by marketers who are employed by organisations to achieve the goals the organisation sets them.

Obvious perhaps, but sometimes the obvious hides a deeper not-so-obvious truth. To glimpse this deeper truth we first need to see how our initial assumption colours everything – everything – marketers do. If ‘marketing’ is done by marketers working for organisations then:

 

— the purpose of marketing: to help the organisation achieve its go-to-market goals.

— the processes marketers use – processes that help the organisation pursue its purpose, of course.

— the metrics marketers use to measure how well they are doing.

For any practitioner, this is a vast, rich and complex agenda. But as I’ve noted before, it’s also stunningly limited. So let’s step outside of it for just a moment.

Beyond the organisation’s go-to-market goals and imperatives, marketing also makes a bigger, broader economic contribution. Every economy involves production and consumption; supply and demand. How well the economy works, however, doesn’t just depend on production prowess but on how well production and consumption/supply and demand are aligned. If you’re brilliant at supply, but you supply something for which there is no demand, then your production activities haven’t created wealth. They have created waste instead.

Ditto: if you have produced stuff people want but they can’t navigate their way to it, your efforts are as good as wasted. So the magic ingredients in any economic system are not production and consumption in isolation, but the alignment and navigation that bring them into line, in sync. Marketing’s broader economic contribution, then, is to ensure that production is a wealth creating rather than a waste creating activity. Pretty important in other words.

Now: a question. Who says it is the God-given right or duty of organisations to direct, manage and organise these economically critical tasks of alignment and navigation? The principle of alignment and navigation holds true whether it is carried out by producers (the source of supply), a third party such as a government, or the source of demand (‘the consumer’).

Communism tried giving governments this task. It didn’t work. But what about giving it to ‘the consumer’ – the buyer? If the task of alignment and navigation were designed, organised and managed by buyers or people working for buyers, rather than sellers, would they look the same as they do today? Or different?

Let’s think about it, for just a moment. Both the seller and the buyer have a role to play in alignment and navigation. Sellers need to think about what they should sell and how best to sell it. Buyers need to think about what they want to buy and how best to buy it.

If sellers – marketers working for organisations – are in charge, then the questions ‘what to make, how to sell it’ naturally move centre stage. They turn into a focus on things such as product development, differentiation, brand awareness, brand preference and loyalty. This is the stuff marketers worry about. How to get consumers to choose our brand rather than our competitor’s brand? What messages to send, to which target audiences, how? How to do all this stuff as efficiently and effectively as possible?

As I said, it’s a huge agenda. But to what degree is it the same as the buyer’s agenda? A buyer going to market has a completely different set of goals such as ‘how to make the best purchasing decision?’ and ‘how to make and implement my decisions as efficiently and effectively as possible?’ If we look at alignment and navigation from the point of view of the buyer we get a very different picture:

— the purpose is to help the buyer achieve his or her go-to-market goals

— processes need to help the buyer  pursue these goals. For example, processes that ‘help me clarify and articulate exactly what I want’, ‘help me see what’s possible and available out there’, ‘help me compare the alternatives’ qualities and merits’, and ‘help me do all this as efficiently and effectively as possible’

— key KPIs and metrics need to measure how well the buyer’s goals are achieved. This isn’t just about ‘the product’ and its value for money. It’s about how much time, money and effort the buyer has to invest in going to market and how well his go-to-market goals are achieved: it’s ‘marketing accountability’ except from the buyer’s point of view. The key question: how can the buyer’s metrics be improved?

The thing is, this isn’t some crazy, irrelevant thought experiment. It pretty much defines the changes that are sweeping markets today. We are in the midst of a control-shift – a shift from an organisation-centric, seller-centric world where organisations control the central critical processes of alignment and navigation (and use this control to pursue their own priorities and agendas), to a person-centric, buyer-centric one where, increasingly, individuals – consumers – control the processes of alignment and navigation and use them to pursue their own personal priorities and agendas.

Nearly everything we see around us – the rise of online search, of social networking and of other peer2peer information-sharing mechanisms and services, of comparison engines and so on – is contributing to this shift, accelerating it, deepening it, extending it. And they are just the beginning.

The two sides’ concerns still remain unchanged. Sellers still worry about what to sell and how best to sell it; buyers still worry what to buy and how best to buy it’. But the balance is shifting.

For the last hundred years, virtually all marketing – i.e. the professional, organised management of the tasks of alignment and navigation involving the investment of money, brain-power, research, data, analysis, technology, services, tools, techniques and so on – have supported the seller’s agenda, leaving buyers/consumers to muddle along as best they could within a seller-created and seller-driven environment. Sellers set the agenda, and buyers responded accordingly.

Today, increasing amounts of money, brain-power, research, data, analysis, technology, services, tools, techniques and so on are being deployed on the buyer’s side, helping buyers to articulate and set their buying goals, and helping them choose and implement the processes which best help them achieve these goals – with sellers responding accordingly.

This is the essence of the buyer-centric revolution. It’s much more fundamental than a tweak to marketing ‘tactics’ or even a new ‘strategy’. It’s a control shift; a systemic change – a transformation in how the system itself works. It requires marketers to question the obvious and rethink what they are trying to achieve and how. Does the sun really orbit the earth? How, exactly, does marketing add value and where?

Intriguingly, even though this buyer-centric revolution initially seems rather threatening to sellers, it is in fact a breakthrough opportunity for those who can see it and grasp it. It changes everything: what consumer value looks like and how to deliver it, the role of advertising, branding, metrics; how to think about new phenomena such as the internet or social networking.

That’s the task I’ve set myself for the coming weeks: to explore what the buyer-centric revolution looks like, why it’s happening, and what it means for marketing and organisations.