Uncertainty: The hidden barrier in B2B markets


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Joe Radwich

Joe Radwich
Vice President

Uncertainty: The hidden barrier in B2B markets

Many B2B purchases are delayed or abandoned due to the uncertain outcome of the decision. Prospects compare the certainty of the status quo (good or bad) to the potential (but uncertain) benefits of a new solution and opt for the “devil they know”.  The implication: B2B Marketing and Sales can help prospects reach a purchase decision by reducing uncertainty for the new solution, and increasing uncertainty of the status quo.

Favoring certainty

A recent study by Jeffrey Pfeffer, a professor at the Stanford Graduate School of Business shows that individuals favor certainty of outcome over potential benefits – they choose a certain loss of $100 over a chance to flip a coin with the chance to pay $0 or $200. Complexity exacerbates the problem. With more moving parts in the equation, people find it increasingly difficult to envision how the future will play out.

It turns out it’s not Go with the devil you know. It’s Go with the devil you know over anything else – unless you are absolutely sure about the other option.

Companies and B2B markets tend to follow the same pattern: The more conservative the company or market, the more dramatic the effect. The preference for the known plays itself out daily across markets and organizations.

  • As prospects go through their evaluation process they ask for more information, details, case studies, etc. in an effort to bring certainty in their decision. In a recent post Make it easy for prospects to buy we explored how providing all the information prospects request doesn’t help get prospects over the hump and to the buy decision – it bogs them down further.
  • Flip through a B2B trade publication and you’ll see that many of the ads look the same and don’t change much over time. Behind the scenes, B2B marketers ask their creative agencies to help their brand stand out in the marketplace. However, most B2B brands stick with the original creative strategy because its performance is more certain.
  • Research reports that present the data as %’s often get more attention than qualitative insights because a number feels more certain than a description – whether it is or not.
  • It took almost a decade for most markets to become comfortable with cloud software solutions. They knew the cloud offered significant benefits over their on-premise solutions, but most companies didn’t want to move until they saw that the cloud was here to stay and that everyone else was doing it too.

Pain points trump benefits

Perhaps the most basic, yet important, manifestation of this trend is that solving pain-points represents a more effective sales and marketing strategy than selling benefits. Here’s why…

  • Pains are certain. Concrete. They are something specific the prospect knows it needs to address. Once a pain gets significant enough the desire to find a solution outweighs the uncertainties that come with new approaches and vendors.
  • Benefits are hypothetical. If a prospect does x, y, and z, they should receive the benefits. Benefits raise questions: What if a key assumption turns out to be false. Benefits come with more professional risks. Unrealized benefits lack the certainty of the status quo.

The insights from Pfeffer’s research and the day-to-day experience of B2B sales and marketers leads to one conclusion: B2B sales reps and marketers need to change the uncertainty equation.

  1. Increase the certainty of new solutions
  2. Decrease the certainty of the status quo

Increase the certainty of new solutions

Recognize and acknowledge the uncertainty

Left to their own devices individuals and businesses can easily overestimate the things that can go wrong with a new approach or soluiton. By acknowledging the risks that exist, vendors can set the parameters of what the risks and uncertainties actually are. This can include letting prospects know where other individuals/companies run into trouble, what needs to be in place for the solution to be a success, etc. Acknowledging uncertainty not only frames the issue, it increases the knowns associated with the new solution.

Create specific certainties

Reducing the number of unknowns (even minor ones) makes options look more appealing. This phenomenon is known as zero risk bias which is the tendency to prefer options that completely eliminates some risk factors in a decision but leaves other untouched, over options that may produce a greater overall reduction in risk, but do not eliminate any individual risk factor. The preference for options that completely eliminate some risks likely stems from the reduction in complexity – it reduces the factors that have to be considered in the decision.

Examples of certainties that B2B vendors can create include:

  • Concrete implementation processes and milestones
  • Metrics of how other customers use the solution, e.g. 75% of customers select this approach
  • Definitive outcomes, e.g. the ads will stand out from competitors (which is different than saying they will be effective)
  • Customer satisfaction scores
  • Guarantees / Shared risk models

Raise the uncertainty of the status quo

While the status quo feels stable to individuals and organizations, it’s not. Sales and B2B marketers can point out this false sense of security by asking questions or providing data that highlight the actual uncertainty associated with prospects sticking with the status quo: Your market appears to be changing in this way, how will that effect you? These new entrants have entered the marketplace, what does it mean for your market? etc. etc.

There is no single approach or silver bullet for changing the certainty equation. Prospect perceptions of, and preference for security are rooted deep. We suggest a few starting points:

  • Examine the customer journey to ensure you understand their status quo and pain points.
  • Identify the benefits of your solution that are most believable to the market, and therefore have greater certainty.
  • Analyze the Marketing and Sales Process. To what extent does your approach (advertising, collateral, sales process, etc.) reduce or increase certainty for the buyer?

These steps will help sales reps and B2B marketers look more certain in an uncertain world.