March 1, 2022

Written by

Collective[i] Team

  • Posted in
  • Sales Forecasting

The network effect: How intelligent applications will disrupt B2B

The future of B2B lies in intelligent applications and the network effect, according to Steven Messer, co-founder of Collective[i]. To meet that future, B2B companies have to shift their perspective and use data differently, however. “Intelligent applications require a new paradigm that dynamically learns in order to support continuous optimization,” says Messer. “The old way of doing things focused on making every step of a linear process more efficient. Artificial intelligence (AI) is an extraordinary advancement in that it can remove process entirely, with human talent operating at its greatest capacity.”

Intelligent applications will provide exponential advantages to companies, starting with increased opportunities for optimization. The power of these applications comes from the network effect.

What is an intelligent application?

An intelligent application analyzes vast amounts of data to train AI and spot patterns across companies. Intelligent applications that are continuously learning and improving to become relevant and useful.

Traditional applications analyze company-specific data and then use this historical information to improve workflows. But the reliance on historical data limits the potential for improvement because historical data cannot account for new patterns or variables — for instance, historical data couldn’t have predicted the coronavirus pandemic or its effect on buying patterns. Intelligent applications have incredible potential to improve business outcomes by delivering dynamic insights on the market and customer preferences.

“The traditional way of working has focused on refining workflows and processes by making incremental improvements for efficiency,” points out Messer. “The future of work is about enabling agile and highly targeted execution that adapts to market changes and customer preferences. Intelligent applications are the underlying technology enabling this transformation.”

Intelligent applications exist in a variety of forms and run the gamut of sophistication. A chatbot or virtual assistant on an ecommerce site is an example of an intelligent application, albeit a simplistic one. On the other end of the spectrum is Collective[i]’s end-to-end digital platform that enables sellers with tools such as Intelligent ForecastTM, which provides automated, adaptive, probabilistic predictions about revenue.

“The migration to intelligent applications took place in the B2C world years ago and trained an entire population of consumers to expect more from technology,” says Messer. “Companies like Amazon, Uber, Airbnb and Netflix don’t just capture our transactions, they use massive networks of data to radically improve our customer experience with better products, recommendations, and on demand service.”

Intelligent applications can produce similar outcomes for B2B companies as well. Massive networks of data are the key to intelligent applications and unlocking their potential. Instead of relying on narrow, historical information, intelligent applications rely upon the network effect to generate their data-driven insights that are transformational for B2B companies.

What is network effect and why is it valuable?

To understand the network effect, you need to understand the two types of data that support intelligent apps: narrow and networked.

Narrow data comes from one company and includes only internal data sets: i.e., what that single company knows about itself, the market, and its customers. Networked data is a pool of information that is gathered from a much broader set of sources — such as vast data sets of buying behavior gathered from the internet.

The network effect takes advantage of the increased interactions with networked data to develop insights. The network effect is best understood by looking at an example. Fitbit doesn’t just track one user’s behavior, it collects and learns from all the users’ activities. This large amount of data allows Fitbit to spot patterns and issue customized recommendations based on these insights that can help improve the health of each individual user. The network effect gives intelligent applications more interactions and larger amounts of data to work with, as seen here:

network effect

Collective[i] uses these interactions to make the most relevant and valuable recommendations for clients. We leverage data, communities, and connections to generate insights and enhance the buying experience. For example, Predictive PipelinesTM provides AI-enhanced information that allows sellers to review pipelines and improve outcomes.

What are network effects in technology?

There are many examples of B2C companies with network effects, such as the FAANG companies (Facebook, Amazon, Apple, Netflix, and Google) and BAT (Baidu, Alibaba, and TenCent). “Companies that use intelligent applications assume that the world is dynamic, and they want technology to help their people, products, and processes evolve,” Messer explains.

For example, Amazon uses the network effect with great success, as seen by its increased revenue year after year. The company uses networked data to give people recommendations for what to buy. Deals with authors, publishers, seller networks, and affiliates, as well as product information also feed into this algorithm that is constantly learning and improving to give people what they are looking to purchase.

The network effect isn’t just a solution for B2C companies, however. B2B organizations can take advantage of the network effect as well. Looking at a B2B example, Messer says, “consider a sales team onboarding a new seller. It could take years to develop the relationships, information, and judgment that will gain trust with an enterprise customer. Intelligent applications leverage networked data to condense millions of interactions into concise recommendations that reflect years of experience.”

B2B applications have been slow to adopt the network effect due to the large amounts of data that is needed. However, tools such as Collective[i] can bring this opportunity to them. The network effect comes into play in all Collective[i]’s products, including Intelligent InsightsTM, which uses AI and machine learning to replicate the judgement of your top sales performers, helping to guide sellers’ attention to where it can make the most impact. With opportunity odds, recommended buyers, and risk alerts, sellers don’t have to waste any time chasing dead ends. The power of the network effect makes this possible.

What are the benefits of technology with the network effect?

The benefits of technology that use artificial intelligence with the network effect include efficiency, connectivity, insight generation, agility, and optimization enablement.

Intelligent applications are highly efficient at eliminating non-revenue-generating processes and providing alternative solutions that improve outcomes. For example, C[i] RecommendsTM analyzes top performers across the IntelligenceTM network to determine the activities that are most valuable for sellers. They receive a daily list of recommended actions that drive the best results.

The network effect also comes into play with social networks as well. After all, 73% of buyers prefer to work with sales professionals who have been referred by someone they know, making the business network a vital piece of the selling puzzle. ConnectorsTM uses the network effect to help sellers leverage their business networks and surface people who have meaningful relationships with prospects. These types of intelligent applications will disrupt B2B — and already have. Jump into the future with Collective[i] today.

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