4 Ways Startups Can Win

The classic 5-stage buying cycle (awareness, consideration, intent, purchase, renewal) is a useful tool for dissecting buyer decision-making. But within the first few stages, there are actually 4 different buyer states of mind:

1. Problem Centric
   Buyers have a problem, but don’t know to solve it.
   - Buyer says: My car is on it’s last legs. I need a new one. Should I try to fix it? Should I get a new one?
   - Pro: Buyers are in a position to be persuaded.
   - Con: Buyers are early in their buying cycle so they require more education/time/money/persuasion.
2. Category Centric
   Buyers have think they know how to fix their problem. They just don’t know the best brand/product yet.
   - Buyer says: I want a new car. It has to be a sedan.
   - Pro: Companies that lead a category get the lion’s share of the market cap. AKA — “Nobody Gets Fired For Buying IBM”.
   - Con: If you’re not the category leader, you have an uphill battle.
3. Alternative Centric
   Buyers tried the competition and are itching to move.
   - Buyer says: BMW sedans are not my thing. I heard Audis are nice.
   - Pro: You just have top beat 1 competitor. It’s easy for the team to rally around.
   - Con: You’re chasing someone’s else tail and eating their scraps. Some of the scraps from a multi-billion dollar company can be nothing to sneeze at (e.g. Avis — We Try Harder).
4. Brand Centric
   Buyers want only only your brand. They accept no substitutes.
   - Buyer says: I want anything and everything made by Tesla. I need the Model 3!
   - Pro: Buyers identify with your brand. They evangelize it. Competitors stand no chance. Price is no object.
   - Con: “It takes 20 years to build a reputation and five minutes to ruin it.” — Warren Buffet

Figuring out which approach to optimize around is a key part of figuring out growth.

Additional Reading: https://www.intercom.com/blog/how-people-buy/