Last month, we posted the need to think deeper than the RFP language if you want to win large contracts. Part of this is understanding the buying process and the many influencers affecting the purchase decision.
This post deals with the economic buyer, the final decision maker in complex sales. Only he or she can say yes--although technical buyers and user buyers will have varying degrees of influence in the decision.
About the economic buyer
Economic buyers are often referred to as “the person who writes the cheque.” These are senior executives, often the business unit leader. Economic buyers typically focus on value for money and are willing to make trade-offs to get the best deal. They rely on recommendations from the other buyer types, but retain veto power over any decision. They also bear ultimate responsibility for the purchase. Depending on the buying organization, they may get involved late, after compliance and major technical thresholds have been satisfied.
So how do you appeal to the economic buyer for your proposal?
Show strategic fit and economic value
Economic buyers come closest to representing the strategic needs of the prospect. Get buy-in from these buyers by making the following kinds of arguments for your solution:
- Aligns with the buyer’s vision and strategy: Connect the immediate purchase to a statement of the buyer’s corporate vision and/or strategy from its website, annual report or public remarks.
- Achieves business goals: Cite specific goals from your sales conversations or other sources and show how your solution will achieve them.
- Budget fit: Show the cost of your solution is within the budget range for the required features and performance
- Business improvements: Show how you will improve productivity, growth, competitiveness and/or profitability
If your solution is the most price-competitive option, stress that it will fulfill the requirements at the lowest cost. If your price is higher, use a lifetime costs argument to show how your extended warranty, higher performance, ease of use, lower maintenance and/or other factors justify the higher initial cost. Economic buyers will also look at cash flow, so state your economic arguments clearly in section summaries, captions and call outs.
Don’t leave it to the evaluators to figure out your price competitiveness. Ghost your competition to do this even in proposals that do not include prices or where pricing is evaluated separately—if you can do so within the rules.
Hot button issues
Because of the power wielded by economic buyers, their key issues (if any) are worth discovering and addressing. Make it part of your sales discovery to find out what specific issues motivate the economic buyer in each case.
In cold proposals check out the economic buyer’s online presence and LinkedIn connections for sources of information on his or her hot buttons.
Do economic buyers even read proposals?
Depending on the individual and the situation, the economic buyer may be highly involved—or a rubber stamp.
Business owners are almost certain to be involved and may also be the main technical buyer. In large public organizations, the final sign-off may be a formality—especially for relatively small contracts with limited impact on the organization. In some cases, a committee will make the decision.
But that doesn’t mean you can skip the economic buyer arguments. When making its recommendation, the evaluation team will still want to position a solution as the best combination of cost and value--especially if they are not recommending the lowest priced solution.
Need help with an important bid proposal?