The recipes for success of high-growth B2B companies
by Jan U. Holsten
The rules for successfully marketing products and services in B2B business have changed significantly in recent years. Digitization has not only changed the purchasing behavior of buyers, it has also opened up completely new and very promising marketing and sales processes.
On the purchasing side, we are seeing a paradigm shift in the way buyers obtain information, collaborate with sales organizations, and make decisions. While in the past, the sales side often felt it “had the upper hand” with experienced, technically brilliant and rhetorically versed experts, digitization now means buyers are less and less dependent on interest-based statements from a sales organization. Due to the 24/7 availability of data relevant to the purchase decision, the previous information imbalance has radically changed in favor of the buyer. At the same time, the use of digital media along with processes in the purchasing departments of many companies has increased significantly once again in the wake of the ongoing COVID-19 pandemic. This increases the pressure on the seller to further develop digital marketing and sales processes.
But how have the framework conditions for marketing and sales processes changed and how do successful companies expand their market share?
Equal chances instead of a monopoly of information: New demands on marketing and sales
Not long ago, push-based outbound marketing measures were the focus of B2B marketing in most companies. Advertising and trade fairs were dominant instruments. The main focus was on the early phases of the purchasing process, awareness and interest were the most important goals. In order to obtain information in the further phases of the purchasing process (supplier identification, supplier evaluation, product demonstration and purchasing and price negotiations), buyers were mainly dependent on information from and exchanges with B2B sellers. This is just one of the reasons why Field Sales Representatives were held in particularly high regard in many medium-sized companies, and in many cases still are today. Due to the information asymmetry at the expense of the buyer, their work and skill was considered as directly responsible for successful business.
But this is no longer the case. Today, sales organizations are confronted with a completely different type of “buyer” and the decision-makers have strongly changed their purchasing behavior. The average age of many buyers has fallen significantly in recent years – and the younger the buyers, the greater their preference for digital tools and a digital purchasing process that is as comprehensive as possible. Content relevant to purchases is available online anytime, anywhere and free of charge.
This fact offers great added value from a purchasing perspective. Digitally available information can now be used “on demand”, usually along with opinions and assessments of independent third parties or other customers and is prepared using multimedia, to name only a few big advantages. While the seller is becoming increasingly less important as a source of information, sales functions such as marketing are becoming significantly more relevant.
This change in significance has long been observed and is measurable. For example, buyers report that on average, they have already completed roughly two thirds of their purchase decision processes before they even speak to a (field) sales representative for the first time. Our experience has shown that almost 70 percent of buyers are not interested in talking to a salesperson at all, but rather want a process that is as holistically digital as possible.
Knowing your customer is good. Analysis is better.
Many companies think they know their customers and their purchasing behavior well based on their analogue customer relations. The stronger this belief is anchored, the more difficult it is for these companies to analyze digital buying behavior. As a result, they remain blind in one eye. In order to understand buyer preferences and to be able to react to them with suitable marketing and sales measures, a structured analysis of digital and mobile channel usage is essential. Only in this way does it truly become clear in how and to what extent purchasing behavior has changed (in favor of such channels).
Better customer behavior analysis leads to better conversion of the knowledge gained into heuristics and corresponding algorithms, which ultimately leads to better B2B sales that has the ability to predict future behavior (predictive analytics). We now have an almost unmanageable number of qualified service and system providers available to carry out such analyses. Understanding the necessity and the business ability to invest in appropriate processes and technologies is thus crucial for success. In any case, there is no shortage of the necessary technologies.
This has resulted in far-reaching new requirements for marketing and sales. Based on our experiences with medium-sized customers and discussions with managing directors and managers from purchasing and sales departments, we have identified the most important success factors for a realignment of your marketing strategy. In addition to industry-specific peculiarities, we have also discovered many shared characteristics.
Read our next blog post and find out more about recipes for digital B2B marketing success in the follow-up article by Jan Ulrik Holsten!
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