Practising “Best Practice” Product in the Context of B2B2B2C "Product people - Product managers, product designers, UX designers, UX researchers, Business analysts, developers, makers & entrepreneurs May 05 2021 True B2B, B2B products, Mind the Product Mind the Product Ltd 1706 Business lines all connecting together Product Management 6.824

Practising “Best Practice” Product in the Context of B2B2B2C

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“Who are we building this for, the buyer, their customer, or the users?!” This was the Product and Design team I was leading in 2020 which focused on building and selling an enterprise-grade digital platform in healthcare.

The complexity of this situation was consternating. Who were we supposed to serve, and how would we serve them without neglecting the other party’s needs? By the end of this experience, I picked up a few actionable insights that helped me lead my team through it.

The complexities of B2B2B2C

Our struggle was to find the right balance between the competing priorities of multiple layers in ‘buyer to user’ relationships. While our buyers might push for configurable branding in our consumer-facing emails, their customers wanted to reduce costs. Finally, everything we knew from countless hours of research was that the consumers wanted a way to better manage their medications.

My product team was locked in an identity crisis. We had to ask ourselves whether we were a company building software for our buyers to deploy to their customers and consumers (B2B2B2C), or if we were building solutions for patients (B2C) and delivering results back to the buyer.

Needless to say, there were a lot of cooks in the kitchen who thought we were there to serve their needs. Spoiler alert, their needs diverged in fairly substantial ways. We were under pressure to react to the demands from the buyer who, of course, was paying our bills. Meanwhile, we were also trying to focus on the needs of the end-users. It was a conundrum of sorts.

My methodology below helps product teams be more strategic in how they allocate time and resources amid various competing counter-demands. I also realized how frequently this problem occurs, despite the lack of product literature about it.

Here’s an illustration of the relationships in my experience below:

An illustration of the B2BB2C product process (Image: Morgan Beschle)
An illustration of the B2BB2C product process (Image: Morgan Beschle)

Looking to the Literature

I started to look externally for success stories in a similar context, as I recognized that this issue must be a problem that has been solved elsewhere. I pulled out a few other previous reads from the bookshelf, like “Hooked” and “The Lean Startup”, curled up on the couch, and flipped through the chapters in search of better models to apply in a B2B2C context. In practice, I found that our space was even more complex. It looked more like B2B2B2C, but without the clean handoffs of a classic indirect distribution model. A dynamic like this, where a vendor maintains direct relationships with all businesses and users in the chain is hardly acknowledged in the product literature.

A two-sided marketplace comes close to describing some of the dynamics, but it has a much cleaner exchange between provider and consumer. It also doesn’t appear to introduce the complexity of the vendor actually delivering unique value to the end consumer. I wasn’t finding guidance or best practice models that addressed the unique barriers and pressures of a B2B2B2C value chain. I was coming up empty-handed and frustrated. My situation couldn’t possibly be the only product team facing this complex chain of stakeholders, could it?!

It turns out it happens all the time. Common examples of B2B2B2C contexts include health insurance companies that work with a health IT vendor to deliver a product to the employees of their major employer customers. Often these contexts require vendors to deliver products in the form of software, services, or reporting to the buyer, buyer’s employees, buyer’s customer, buyer’s customer’s employees, buyer’s partners, and ultimately the end consumer. Overwhelmed yet? What I found in the literature were many validated models that had only been tested in simpler contexts.

Best practices

I found time and time again that the pressures of this complex web of B2B2B2C relationships would require a more nuanced model that constantly had to be re-balanced. It was easy to fall victim to the overwhelming tsunami of the buyer and lose sight of the consumer.

I thought this scenario was similar to my index fund investments with Vanguard. There is no perfect roadmap or instruction book to tell Vanguard users exactly how to invest their funds and distribute them across low and high-risk investments to maximize their return due to the unpredictability of markets. There are merely best practices and guidelines. Likewise, there was no crystal ball for what the markets would do, If I applied a ratio of 90% in stock and 10% in bonds today, the percentage allocation would naturally shift over time on account of market dynamics that I couldn’t have predicted — it would eventually be time to rebalance my funds again.

Developing New Tools

Consequently, I decided to develop a fresh pragmatic model for how best to manage this complex B2B2B2C context. It would also help product teams balance the needs of the customer while also achieving their own goals. I ventured to create a few simple frameworks so other product people could navigate the complex B2B2B2C context.

The framework would need to answer the following gnarly questions:

  • How do you ensure you balance the needs of buyers with investing in the outcomes they expect you to achieve with the consumer?
  • How do you handle buyer needs that directly conflict with those of the consumer? Especially when the buyer will ultimately hold you accountable for the satisfaction and outcomes.

Throughout my journey, I found three ways to balance the buyer and consumer stakeholders in the complex and gnarly B2B2B2C context:

Get clear on the outcomes for each stakeholder in your value chain

Once you know your value chain and what motivates each stakeholder, host trial sessions with buyers to test your theory. Start forming a story and argument for why the buyer should care about the outcomes you and your organization want to drive. This assessment can be utilized as a framework, It will also enable you to say no to buyer-led priorities while framing your priorities as a win for them.

B2BB2C
B2BB2C product process framework tool (Image: Morgan Beschle)

Find a successful working example (keyword: successful) out in the wild

What other vendors are in a complex B2B2B2C context? Can you find a compelling analogue?  Join local product slack channels and communities to seek out expertise. A relatable analogy will help you rally internal stakeholders and build understanding in your customers. Learn what strategies that industry has utilized to achieve success. Network with people who work for vendors in that space who have successfully navigated these challenges.

Beyond healthcare, other B2B2B2C contexts to explore can be found in the event space. They balance the needs of corporate sponsors, vendors, employers, and many more. Furthermore, in the catering space, they balance the needs of drivers, employees, and restaurants etc.

Find the traps

It’s easy to dream of crossing the finish line and all the fanfare that comes with it at the beginning of every marathon. However, any strong product person needs to think of all the potential pitfalls that may get in their way, like heartbreak hill or the mile 20 slump. It’s important for product managers to prepare their teams and stakeholders to recognize them before they happen, intentionally steering around them.

Using a methodical tool allows you to think about how to utilize data gathered from various stakeholders to get buy-in from the buyer about where you want to go. Many buyer customers have hired a vendor to disrupt their space, so don’t underestimate your power in convincing them of a new model.

Now, identify the areas where the buyer and consumer needs align and differ, for example:

  • Which are the sacred cows on each side?
  • Which are most critical to your mission and success?
  • If you needed to be bullish on one consumer outcome that doesn’t align with your buyer’s priorities, which would you choose?

Once you know what outcomes you want to prioritize, you can organize and align your product, design, and tech people accordingly. Your priorities should be reflected in the percentage allocation of your resources. By giving your teams focus on the most important outcomes, they will experience less turbulence and whiplash. Consequently, you’ll be more likely to intentionally maximize value throughout the complex chain of B2B2C2C.

B2BB2C
B2BB2C product process framework tool (Image: Morgan Beschle)

In Conclusion

While I was at first intimidated and frustrated by the gridlock that can sometimes occur when selling products in a B2B2B2C context, I learned some strategies that not only can help teams navigate competing priorities, but unlock unprecedented value. Buyers don’t always ask for the same things that will drive the outcomes. They ultimately will hold their vendors accountable for realizing with their end-users, product experts can approach them as the humans they are to help them understand the tradeoffs.

We should recognize that the best advice from product literature is often generalized for cleaner B2C or B2B contexts. Buyer stakeholders don’t always realize that what they’re asking for is competing with a vendor’s ability to pursue a higher value outcome for end users.

Building relationships with buyers and making your strategy and measures of success more transparent can go a long way towards getting buy-in. To support your strategy, decide how much you want to invest in each vertical and align your resources accordingly. Doing so will protect your teams from weathering too much turbulence.

Finally, preparation is a negotiator’s best skill. Invest the time upfront to methodically create a strategy that empathetically anticipates each stakeholder’s future needs and builds the buyer’s understanding of the tradeoffs between them. Trust in your ability to remind buyers what they care about most in terms of ultimate value to the end-user. After all, it’s likely what they hired you to accomplish :).

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