Is Behavioural Economics applicable to B2B as well?
Category: Blog & News
When asked whether Behavioural Economics (BE) applies to Business-to-Business (B2B) well as Business-to-Consumer (B2C), "people are people" has been my response. At least it used to be.
"People are people" does have a lot of truth to it. We are the same person when we buy lunch as a consumer as we are when we negotiate a deal with a supplier - our hats may change but our behavioural biases and mental short-cuts do not. We are just as prone to social norms in the boardroom as we are in the bar - we can't simply shut this stuff off just because it's someone else paying.
That means BE is just as relevant in B2B as B2C environments. But,
It's learning how to apply BE that's different
As I've discovered though, there is a key difference in how best to impart knowledge about the application of BE. For those either in a B2C environment or in a role with direct connection with the buyer (i.e. sales and marketing), all focus is on the end consumer. The target is easily identified, tends to be stable and this knowledge is shared so that everyone in the business 'gets' who it is we are trying to influence.
In a B2B environment or non-customer facing role it's a little different. We might be selling a product or service to an accountant, a teacher or a nutritionist, or 'selling' an idea to an investor, stakeholder, colleague or supplier, but we think of them first by their profession rather than their consumption. That means when learning about BE it is hard to get a fix on who we are trying to influence.
Same behavioural principles, different framework for application
The upshot is that while the behavioural principles are the same, I train B2C and B2B job functions using different frameworks.
B2C - how they receive your message
For those in B2C or customer facing roles, I focus on how we apply BE to "them", the receiver of the message because it is natural to attend to their needs. From there the task is to retro-fit this understanding to how you craft your message. (Typically this means how to overcome the 3 key behavioural barriers which you can read about here).
B2B - how you send your message
In B2B or non-customer facing roles, I instead focus on how we apply BE to you, the sender of the message, because while your receiver might change you are the common element across all your attempts to influence. (This means how to construct an argument using where, when, how and who for non-rational rather than just rational consumption. Get a taste of here).
So while people are people and behaviour is behaviour, I've learnt through experience that transferring knowledge about BE's application is easiest when it feels familiar, and that means adapting how it's done rather than what it does.
If you'd like to find out more about either B2C or B2B training just let me know.
This article also appeared in Smartcompany.