B2B marketers can be very focused on the short term, and who can blame them? Sales are putting on the pressure for a constant stream of leads and business leaders have quarterly targets to hit to keep the shareholders at bay.
It’s this short term thinking that means the majority of activity produced by B2B marketing teams is below the line, bottom of the funnel, sales ‘activation’ activity (call it the boring stuff) and not the bigger, fame and brand building advertising activity that the majority of B2C brands seem focus on (the glamorous stuff).
Now, couple this with the fact that the average tenure of a CMO is now just 43 months (and that new incumbent wants to shake things up and make their mark on the business), and it’ll come as no surprise that only 4% of B2B marketing teams measure impact beyond six months.
But a new report from the B2B Institute and LinkedIn, packed with research from Advertising Effectiveness stalwarts Les Binet and Peter Field, says this short-sightedness is damaging the growth potential of B2B brands.
According to ‘The 5 principles of growth in B2B Marketing’, in order to grow, B2B marketers need to start shifting efforts (and budgets) towards a 50/50 split between short term activation activity and long term brand building (the stuff that makes you famous).
However, it’s pretty clear we are starting on the back foot. B2B marketers are incredibly sceptical about the value of brand building and many have a misconstrued view of the effect brand building has on the business.
Just 30% of B2B marketers, for example, believe advertising has an effect on pricing power and only 50% believe reach is a strong predictor of success. It’s pretty clear businesses need to start thinking differently about longer term brand building. But as with any shift, there has to be a strong reason to do so.
So, we have distilled the findings from the report into four arguments you can take to your board/sceptical CMO to convince them to put more budget into longer term brand building, B2B advertising and fame defining campaigns and activities.
Argument one: “Look! You can’t argue with the facts - brand building will build our market share and our bottom line.”
Let’s start with a fundamental rule. The share of voice rule. A rule that has been known and stayed consistent for the last 50 years. The rule goes thus: brands that set their share of voice (share of all category advertising expenditure) above their share of market, will tend to grow.
This has been well known in B2C, but Binet and Field have shown the trend is true in B2B - a 10% extra share of voice, for example, will lead to a rise in market share of 0.7% per year.
Put simply: shout louder than the competition in a way that gets you noticed and you will expand. That alone is worth the investment.
Argument two: “We can kill two birds with one stone with this! Not only will brand building attract new customers, but it’s a great way to reassure our current customers they have made the right choice and feel proud about being our partner.”
Put simply, brands grow in two ways, either by gaining more customers, or by selling more to current customers. In B2B, the focus is often put on the latter thanks to new customer acquisition costs being high. But this piece of research shows us that actually the best way to achieve real growth is to acquire new customers, meaning more has to be put into activity to attract them.
But shifting budgets to attract new customers doesn’t have to come at the cost of current customers - putting money into brand campaigns also helps reassure existing customers they have made the right choice (and means they can show off to their mates in the pub about working with a cool, well known brand.)
Argument three: “Don’t trust me, trust Danny Khaneman! We need to be the brand that is the easiest to choose when a potential customer is shopping around.”
While everyone seems to think B2B buyers are purely rational beings, the truth is just like anyone else, many of the decisions they make are not made on purely rational thoughts or processes but on brands, products and services that are the most ‘mentally available’. As the economist Daniel Kahneman says, “the brain is largely a machine for jumping to conclusions”.
This is due to the Availability Heuristic - a rule that says given the choice between several options, people prefer the one that comes to mind most easily. It’s the reason that when you are shopping you are most likely to pick up Fairy washing up liquid and Kelloggs cornflakes, rather than unknown brands.
Maximising mental availability, or being the easiest brand to choose to buy, is just as important in B2B as in B2C and the best way to do this is to build fame through brand building campaigns.
Argument four: “A suit isn’t a shield for emotions! After all, Business people are people too, they just happen to be at work. So we need to use the power of emotion to ensure people engage with our brand. And guess what? The best way to do that is long term advertising campaigns.”
As a marketer, one of your key aims should be to make people feel positively towards your brand, even if they can’t say why. That comes from creating emotions and feelings around your brand and positioning yourself in a way that becomes more firmly embedded in a buyer’s memory than functional product messages.
This will translate into real business results, thanks to the fact that if we like a brand (or feel a positive emotion towards it) we are more likely to hold positive beliefs about its benefits. And it shows in the results - emotion based, fame building campaigns outperform rational ones by a margin of 10x. Even the tightest CFO can’t say no to that.
B2B marketers need to need to take off those short term blinkers and start thinking about how we build brands that grow, become famous and build the business over the long term. While the short term activation activity is still key, we need to start readdressing the balance and we hope this starts today.
A big thanks to The B2B Institute, LinkedIn, as well as Les Binet and Peter Field, for their excellent research on which this whole article is based. You can download the full research report here.
James Wood, head of Earnest Labs, the innovation arm of Earnest