Empirical observations on marketing effectiveness proves how brands and companies can grow. They are summarized in five principles for effective B2B marketing by Les Binet and Peter Field. Use these principles as a mental compass (not as the exact solution), and your company will outperform your competitors.
The challenge is that few understand and believe in facts. Brand building is a long-term strategy that pays off in years, not months. And yet, according to a survey done by LinkedIn B2B Institute, only 4% of B2B marketers measure impact beyond six months.
Binet and Field discuss the importance of pricing power and reach, and the relative ineffectiveness of loyalty strategies. And yet, according to the survey, only 30% of B2B marketers believe marketing has an impact on pricing power, only 52% believe reach is a strong predictor of marketing success, and over 65% believe that businesses grow by increasing loyalty, not customer acquisition.
The simple truth is that growth needs to be nurtured, otherwise it will stagnate as proven by the Bass Diffusion Model. It’s like cycling, if you stand still you will fall off – or in business loose market shares. Instead you need to push on and challenge the market and your competitors. The following principles should guide your efforts.
PRINCIPLE 1: Invest in Share-of-Voice
In B2B, brands that set their share of voice (SOV) above their share of market (SOM) tend to grow. In simple terms, growth does rarely come free of charge. You need to invest to grow.
PRINCIPLE 2: Balance brand and activation
In B2B, brands should balance the budget between long-term brand building and short- term sales activation with roughly a 50/50 split. In B2B, data suggests that marketing works best when brand and activation are working together.
PRINCIPLE 3: Expand your customer base
In B2B, customer acquisition strategies tend to be much more effective than loyalty strategies. In B2B, category buyers might be quite a small group but don’t forget the influencers (such as the end-users of the product or service). But smart targeting might also include those who are not yet in a buying role, but whose career paths may soon put them there.
PRINCIPLE 4: Maximize mental availability
In B2B, campaigns that aim to increase a firm’s share of mind are the most effective, and the more famous they make the company, the better the business results. Research from Forrester shows that 41% of B2B buyers have a single vendor in mind when they first begin the purchase process, and a staggering 92% have a shortlist.
PRINCIPLE 5: Harness the Power of Emotion
In B2B, emotional messaging is more effective in the long-term, and rational messaging is more effective in the short-term.
5 simple rules backed by empirical facts.
Download the full report from LinkedIn B2B Institute here
Worth noting is that there is no simple rule or law that gives you the exact map for success in your business. Market varies and companies varies. As an example, growth strategies often varies depending on the size of your business. If you are a smaller company, growth often comes from taking market shares from the bigger players. If you are a big company, you need to grow the market since the main players often has a quite established and steady share of the market.
Do you want to know more about how to grow your market shares, just reach out to ulf@sfinxconsulting.se
