Effective B2B Marketing Demands Original Research

A few days ago, Mantis Research and BuzzSumo published the results of their latest survey regarding the use of original research in marketing. The State of Original Research for Marketing 2019 survey was fielded in May and June of this year and produced 644 responses from global marketers. Forty-seven percent of the respondents were from the United States, and 70% were affiliated with B2B companies.

Both Michele Linn with Mantis Research and Chris McCormick with BuzzSumo have written excellent summaries of the research results. You can find Michele's summary here and Chris' summary here. If you're a B2B marketer, I encourage you to read both of these articles, and even better, take the time to review the full survey report.

In the 2019 survey, 39% of the respondents said they had published the results of original research within the 12 months preceding the survey. The comparable percentage in the 2018 version of the survey was 47%. Chris McCormick believes this drop is primarily due to a shift in the demographics of the survey pool rather than a decline in research use, and I tend to agree with his view.

The survey also found that users of original research for marketing are generally satisfied with its performance. Sixty-one percent of the respondents who had conducted research reported that it had met or exceeded their expectations, and 88% said they plan to conduct additional research in the next 12 months.

So overall, this study indicates that a substantial number of companies have made original research an integral part of their marketing efforts.

The use of original research in marketing is not a new phenomenon. However, I would argue that for most large and mid-size B2B companies, and for many smaller B2B firms, original research has now become essential for effective marketing. Here's why.

Effective B2B Marketing Requires Real Thought Leadership Content

For most B2B companies, effective marketing now requires the development of compelling thought leadership content. Numerous research studies have confirmed that business buyers highly value thought leadership content, and that it impacts B2B purchase decisions at every stage of the buying process.

For example, in a 2018 survey of 1,201 business decision makers by Edelman and LinkedIn:

• 58% of respondents said they spend one hour or more per week consuming thought leadership content
• 55% said thought leadership content is a important way to vet potential suppliers
• 58% said good thought leadership content caused them to award business to a company
• 61% of C-level respondents said good thought leadership content made them more willing to pay a premium to work with a company

Real Thought Leadership Content Must Be Novel and Authoritative

The explosive proliferation of content over the past several years had made it difficult for marketers to create content that will cut through the noise. Thought leadership content can do just that, but only if the constitutes "real" thought leadership. There are two attributes that define real thought leadership and distinguish it from other types of marketing content.

Real thought leadership is novel - Real thought leadership content provides information and insights that are genuinely novel. Merriam-Webster defines novel as "new and not resembling something formerly known or used." Therefore, to qualify as real thought leadership, content must provide information or insight that adds something new and meaningful to the body of knowledge about a topic.

Real thought leadership is authoritative - It's important for all types of marketing content to be credible, but thought leadership content must meet a higher standard. Because thought leadership content advocates new and novel ideas, it's essential for content developers to support those ideas with sound and persuasive evidence.

Real Thought Leadership Content Requires Original Research

The only way to consistently develop novel and authoritative content is by conducting original research. Original research actually plays two central roles in the development of real thought leadership content. First, original research is required to capture the new information and develop the new insights that make thought leadership content novel. And second, original research is critical for thought leadership content because it provides the evidence that makes the content authoritative.

So the bottom line is, effective B2B marketing requires compelling thought leadership content, and original research is the only viable source for such content.

Image courtesy of Vall d'Hebron Institut de Recerca VHIR via Flickr CC.

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Expert Advice on How to Communicate Marketing's Value

In the February 2019 edition of The CMO Survey, senior marketing leaders were asked what marketing leadership activities they find most challenging. The top challenge identified - by a wide margin - was demonstrating the impact of marketing activities on financial outcomes to other senior company leaders.

Measuring the performance and financial impact of marketing has been a persistent challenge for marketing leaders. In the 2019 Marketing Measurement & Attribution Benchmark Survey by Demand Gen Report, 58% of surveyed marketers said their ability to measure and analyze marketing performance and impact needs improvement or is poor/inadequate. The comparable percentage was 54% in the 2018 edition of the survey, and 49% in the 2017 survey.

Last month, an article published at the Harvard Business Review website described concrete steps that marketing leaders can take to improve their ability to demonstrate the value of marketing. "8 Ways Marketers Can Show Their Work's Financial Results" was written by Paul Magill, Christine Moorman, and Nikita Avdiushko.

Paul Magill is a Managing Director with Deloitte Consulting and the former CMO for Abbott. Dr. Moorman is the T. Austin Finch, Sr. Professor of Business Administration at Duke University's Fuqua School of Business and the Director of The CMO Survey. Nikita Avdiushko is a recent MBA graduate from Duke.

Eight Steps for Demonstrating Value

This article provides valuable advice for marketing leaders, and I would like to see the authors address this vital topic in a longer, more in-depth version of the article. In the meantime, here's a very abbreviated version of the eight steps described in the already brief article.

1.  Start with business value - "Marketing leaders should frame their impact broadly, to include all the ways marketing benefits the organization."

2.  Understand what business value means to each function - "Marketing leaders should translate the definitions of their value creation for the different [business] functions they interact with."

3.  Know your own metrics - Most marketing leaders have a set of KPIs they use to demonstrate impact on financial outcomes, and it's critical to be thoroughly knowledgeable about them."

4.  Explain the inherent uncertainties of marketing measurements - "Deep knowledge of the metrics can build your credibility when you're discussing them with other executives, but it helps to explain marketing's inherent uncertainties."

5.  Emphasize validity over precision - "CMOs should emphasize that their metrics are valid when evaluating whether marketing activities are working as expected, and that the inherent imprecision in measuring marketing's financial outcomes does not undermine their validity."

6.  Have a budget strategy - "Provide visibility on total spend, show how spend is aligned with business strategies and key priorities, and demonstrate how working spend has been optimized and non-working spend streamlined."

7.  Have a marketing transformation story - "Further credibility can come from demonstrating ongoing improvements in marketing effectiveness and efficiency."

8.  Meet one-on-one - "Marketing leaders usually attend monthly meetings of the senior management team . . . Our observations suggest these are often poor environments for demonstrating the impact of marketing on the bottom line . . . That work should happen one-on-one, with the CMO investing considerable time in educating their functional counterparts about these points above."

First Among Equals

All eight of these steps are important, but I suggest that Steps 4 and 5 stand out as "firsts among equals."

Over the past two-plus decades, various technologies have significantly enhanced our ability to track and measure some aspects of marketing performance. Today, for example, most forms of digital marketing are highly "trackable." We can know who has opened our emails and who has viewed our content. We can even know how much time was spent with our content.

In addition, technology is now enabling marketers to develop and use more comprehensive revenue attribution models that leverage the strengths of both marketing mix modeling and multi-touch attribution.

But as the authors of the HBR article observed, marketing involves "unknown, unpredictable, and uncontrollable factors confounding precise measurement." Unfortunately, much of the hype surrounding marketing performance measurement makes the job seem to be easier and capable of more precision than is actually the case.

So it's important for marketing leaders to have open and frank discussions with other C-suite executives about what aspects of marketing performance can be measured precisely, and what aspects inherently require the use of assumptions, correlations, and probabilities. Such discussions will help set reasonable expectations regarding marketing performance measurement and ultimately enhance the credibility of marketing leaders in the C-suite.

Illustration courtesy of GotCredit via Flickr CC.

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Have the Differences Between B2B and B2C Marketing Disappeared?

Recently, it's become popular to downplay the differences between B2B and B2C marketing. Some industry analysts and commentators have forcefully argued that all marketing should be viewed as "business-to-human," "human-to-human," or something similar.

It's certainly accurate to say that virtually all forms of marketing involve the communication of messages to human beings. It's equally true that business decision makers are also consumers, and that the attributes and preferences they have as consumers don't evaporate when they're acting in a professional capacity. But have all the meaningful differences between B2B and B2C marketing really disappeared?

The findings in two recent research reports - one by Marketo (now part of Adobe), and one by Forrester Consulting (commissioned by Adobe) - suggest that some of the lines between B2B and B2C marketing have become blurred. These two studies used different research approaches, and they emphasize different aspects of B2B and B2C marketing, but both raise issues that merit consideration.

The Marketo Study

For this study, Marketo partnered with Loudhouse, an independent research firm, to survey 910 B2B buyers and interview 305 B2B marketing professionals. All of the study participants were located in the UK, Germany, or France, and the surveyed buyers represented a range of company sizes and job functions, including IT, Finance, HR, and Operations.

The survey found that, like consumers, B2B buyers are very concerned about privacy. More than 80% of the survey respondents said it is important for their prospective vendors to be serious about protecting their business and personal data and to always conform to best practices for handling their data and sensitive information.

Marketo's survey also found that many B2B buyers, like many consumers, are placing importance on the social values and practices of the companies they do business with. The following table shows the percentage of buyer survey respondents who rated six social practices as important:

This study also revealed two other emerging similarities between business buyers and consumers. First, 30% of the surveyed buyers said they would disengage from a vendor whose values don't match their own. And second, it appears that B2B buyers, like consumers, are becoming less loyal. Forty-three percent of the surveyed buyers said they are always looking for a better deal.

The Forrester Consulting Study

The principal objective of the Forrester Consulting study was to explore the similarities between business and consumer purchase journeys. For this research, Forrester surveyed 552 B2B and B2C marketers (manager level and above) representing a wide range of industries and company sizes. Survey respondents were drawn from a total of nine countries. Because of the composition of the survey panel, this research actually captures the perceptions of marketing professionals regarding the convergence of business and consumer buying behaviors.

In the Forrester survey, marketers identified three attitudes or behaviors that business buyers and consumers share:

• "The desire to remain anonymous"
• "The tendency to seek input and opinions from other users before making a purchase"
• "The amount of emotions involved in the decision making"

More specifically, Forrester asked marketers how certain elements of their customers' buying journey have changed over the past two years. The following table shows the percentage of B2B and B2C marketers who reported that these journey attributes had increased significantly or somewhat:

My Take

There is little doubt that the expectations and behaviors of business buyers are being influenced by their experiences as consumers. But this doesn't mean that all meaningful differences between B2B and B2C marketing have disappeared.

Most B2C marketing still involves the communication of relatively simple messages to a large or very large audience. Most B2B marketing, on the other hand, still involves the communication of more complex messages to a relatively small audience. This difference alone requires the use of different marketing strategies, channels, and tactics.

Top image courtesy of George Redgrave via Flickr CC.

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What Communication Channels Do Customers Prefer? It Depends!

Last month, the CMO Council in partnership with Pitney Bowes published the results of a study that sought to identify what communication channels consumers prefer to use when interacting with the companies they do business with.

The Critical Channels of Choice report is based on a survey of more than 2,000 consumers with nearly equal representation from five generational cohorts - the Silent Generation, Baby Boomers, Gen Xers, Millennials, and Gen Zers. Eighty-one percent of the survey respondents were from the United States, and the balance were from Canada, the UK, Ireland, and Australia/New Zealand.

This research focused on all forms of communication except advertising. While this study involved the channel preferences of consumers, it is likely that many of the research findings will also apply to business buyers.

The core finding from this study is that today's consumers across all generations want and expect the companies they do business with to provide multiple engagement channels. Eighty-five percent of the survey respondents said they expect companies to offer a blend of physical and digital communication channels. More specifically, when survey participants were asked what communication channels they expected companies to provide, the top five channels identified were:

• Email (86% of respondents)
• Telephone (65%)
• Website (53%)
• Text (52%)
• In person (48%)

Interestingly, when survey participants were asked what communication channel they couldn't live without, the two channels most frequently identified by respondents - telephone (28%) and in person (17%) - were both non-digital.

What this research also shows clearly is that consumers prefer communication channels that provide value, and that the most important elements of value are pragmatic. When survey participants were asked what makes a channel indispensable, the top three attributes identified were convenience (50%), reliability (45%), and speed (41%).

Several other recent research studies have found that consumers place most importance on the utilitarian aspects of customer experience. For example, in an earlier study by the CMO Council and SAP Hybris, survey participants were asked to identify the attributes of an exceptional customer experience. The top three choices were:

1. "Fast response times to my needs and issues" (52% of respondents)
2. "Knowledgeable staff ready to assist wherever and whenever I need it" (47%)
3. "Rewards for my loyalty and recognition of how long I have been a customer" (42%)

It's also revealing to see what these survey respondents put at the bottom of their list of important CX attributes:

• "Always-on automated service" (8% of respondents)
• "Brand-developed social communities to connect with other customers" (9%)
• "Multiple touchpoints that add value to my experience" (10%)

Participants in this study were also clear about what types of customer experiences are valuable. They want experiences that save them money (77% of respondents), save them time (49%), or make their lives easier (47%).

PwC's Future of Customer Experience 2017/18 study produced similar findings. This research consisted of an online survey and in-field interviews of a representative sample of 15,000 global consumers, 4,000 of whom were from the United States. Almost 80% of the U.S. respondents rated speed, convenience, knowledgeable and helpful employees, and friendly service as the most valuable aspects of a great customer experience.

So what does this research tell us about how customers form channel preferences. I contend there are two important points. First, the findings of the new CMO Council study make it clear that customers want the option to communicate with companies via a variety of channels. Second, customers will prefer different channels depending on what they are trying to accomplish and the other circumstances surrounding the interaction, and their preferences and choices will be driven by convenience, speed, and reliability in most circumstances.

Image courtesy of Mike Lawrence (CreditDebitPro.com) via Flickr CC.

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Why One Strategy for the Status Quo Isn't Enough

B2B purchases come in all shapes and sizes, and B2B buying decisions are made under a wide variety of circumstances. The context of a buying decision includes - among other things - the cost of the product or service, the complexity of the product or service, how familiar the buyers are with the product or service, the amount of internal change the purchase will require, and buyers' current or past experiences with a prospective vendor.

Collectively, these circumstances largely dictate the psychological factors that will influence buyers and the shape of their decision-making process. The result is, most B2B marketing and sales professionals must be ready to deal with multiple buying scenarios that usually call for different strategies, content, and messaging.

For example, acquiring a new customer presents marketers and sales reps a very different scenario than retaining an existing customer (at the current level or scope of business). And expanding your business with an existing customer presents a third scenario that has some elements of both customer acquisition and customer retention.

The Central Role of the Status Quo

Some marketing and sales pundits say that one vital key to success in all three of these scenarios lies in how marketers and sales reps address the status quo bias, which is typically defined as a cognitive bias that causes humans to prefer the status quo for non-rational reasons. If you think about it for even a few moments,  it should become obvious that customer acquisition and customer retention call for dramatically different approaches for dealing with the status quo bias.

When your objective is to acquire new customers, the status quo is often your toughest competitor, and no sale can be made unless potential buyers first become willing to change their status quo. In this scenario, the first thing that marketing and sales content and messaging need to do is to weaken the grip of the status quo and convince prospects to make a change. Today, the most effective customer acquisition content and messaging uses disruptive insights to encourage prospective buyers to think differently about some aspects of their business.

The circumstances completely change with your objective is to retain existing customers. In this scenario, your company is the incumbent and part of the customer's status quo. Therefore, the first thing that marketing and sales content and messaging need to do is to reinforce the status quo bias and use it to your advantage.

Customer Expansion is More Complex

The situation becomes more complex when your objective is to expand your business with existing customers. As noted earlier, customer expansion scenarios usually have elements of both acquisition and retention. Therefore, marketing and sales content and messaging will need to reinforce some aspects of the status quo and weaken others.

Corporate Visions has developed a content and messaging framework for addressing customer expansion scenarios. The framework is based on research conducted by Corporate Visions in partnership with Dr. Nick Lee, Professor of Marketing at the Warwick Business School in the UK. The study consisted of a test simulation or "experiment" of the kind widely used in academic psychological research.

This research tested five types of customer expansion messaging, and one message type proved to be more effective than the other four across several performance dimensions. The framework of the willing message has five components that are used sequentially. The following table shows the five message components and how Corporate Visions describes each component:

As the table shows, the winning message is a "hybrid" that both reinforces and challenges the status quo. It begins by documenting the value of your relationship with the customer (part of the status quo). But from that point on, it emphasizes the need for change and the positive results that the right kind of change will produce.

Key Takeaway

The bottom line is, most B2B companies derive revenue from multiple buying scenarios, and the impact of the status quo is different in each scenario. Therefore, marketing and sales professionals need to develop and use content and messaging that embodies an approach to the status quo that's appropriate for each scenario.

Top image courtesy of Nichole Burrows via Flickr CC.

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Measuring the Maturity of Marketing Operations

A recent survey conducted by Econsultancy in partnership with Sojourn Solutions provides several valuable insights regarding the state of marketing operations (MOPS) at large and mid-size B2B companies.

The 2019 Marketing Operations Maturity Benchmarking Report was based on a survey of 171 senior executives at B2B companies with 2018 revenues of more than $250 million. Thirty-eight percent of the respondents reported 2018 revenues of more than $1 billion.

Sixty-three percent of the survey respondents were located in North America, and 32% were based in the U.K. All respondents were manager level or above, and all described themselves as either a member of their company's marketing operations team (45%) or very familiar with its operations (55%).

The objective of this research was to benchmark the performance of the marketing operations function along several dimensions and to identify what aspects of marketing operations companies are doing well, and where there is room for improvement.

Econsultancy broke survey respondents into two groups, and the survey report provides data for each of these groups. Top Performers were the respondents who reported that their marketing function exceeded it top business goal in 2018. Top Performers accounted for one-third of the total survey panel. The remaining two-thirds of the survey sample were called Mainstream respondents.

The differences between Top Performers and Mainstream respondents revealed by the survey results are both significant and consistent. The following table contains nine of the performance benchmarking statements Econsultancy included in the survey. The table also shows the percentage of Top Performers and Mainstream respondents who said that each statement was fully or mostly true for their marketing operations function.

As the table shows, there is a gap of at least 24 percentage points between Top Performers and Mainstream respondents on all nine of the performance benchmarks, and a gap of at least 31 percentage points on seven of the benchmarks.

Econsultancy captured the essence of the difference between Top Performers and Mainstream organizations in these terms:

"Relative to their mainstream peers, top performers are further along in the marketing operations evolution in every measure. This striking consistency reflects the interconnected nature of modern marketing; few disciplines within MOPS can exist independently. Top performers are far more likely to have reached a point of marketing-led change, effective implementation or cultural acceptance across a variety of measures."

The Econsultancy survey provides several interesting insights about the maturity of MOPS at B2B companies, but there are a couple of things to keep in mind about this research. First, the survey only produced 171 total responses, which means that the Top Performers group contained fewer than 60 respondents. We should be cautious about giving a great deal of weight to data derived from such a small survey sample.

My second point relates to how Econsultancy divided the survey panel for analysis and reporting purposes. As I indicated earlier, Econsultancy classified respondents who reported that their marketing function had exceeded its top business goal in 2018 as Top Performers. This group represented about one-third of the total respondents. Econsultancy classified the remaining two-thirds of the respondents as Mainstream.

About one-third (35%) of the total respondents reported that their marketing function had met its top business goal in 2018. These respondents were included in the Mainstream group along with those who said their marketing function had not achieved is top 2018 business goal.

I wish Econsultancy had divided these respondents into separate groups for reporting purposes because that would have provided a good picture of the attributes of "average" performers. I suspect that the gaps between the "average performers" and the Top Performers would be narrower, while the gaps between the Top Performers and the laggard group (those who missed their top 2018 goal) would be even wider.

Top image courtesy of Personal Creations via Flickr CC.

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New Research on the Attributes of Complex Buying Decisions

Demand Gen Report recently published the findings of its eighth annual B2B Buyers Survey. The 2019 survey received responses from more than 250 B2B executives representing a variety of industry verticals. Fifty-four percent of the respondents said they predominantly made software/technology purchases. Another 19% said they primarily purchase IT hardware. So about three-fourths (73%) of the respondents were involved in purchasing some type of technology. Virtually all of the respondents were manager-level or above.

The 2019 research shows a continuation of trends that appeared in earlier editions of the buyers survey. For example, a majority of survey respondents have been reporting that the length of their buying cycle is increasing for at least the past four years, as the following table shows:

Demand Gen Report presented the survey panels with several statements describing various aspects of their purchasing process. The following table shows the percentages of respondents in the 2019 and 2018 surveys who said they strongly agreed with five of these statements:

The 2019 survey indicates that a growing number of buyers have become more willing to engage with vendor reps early in their buying process. For example:

• 42% of the respondents said they spoke to and engaged with vendor reps in the first month of their buying process (up from 33% in the 2018 edition of the survey).
• 33% said they accepted outreach from prospective vendors for calls and demos in the first month (up from 23% in 2018).
• 25% said they asked for RFx's, competitive bids, or pricing information in the first month (up from 20% in 2018).

Demand Gen Report also asked survey participants about several factors that distinguished winning vendors from others. The following table shows the percentages of respondents in the 2019 survey who rated six characteristics of winning vendors as very important:

The 2019 B2B Buyers Survey provides important insights regarding the attitudes and behaviors of business buyers, but it's important to recognize that this research doesn't really cover the entire spectrum of B2B buying. The first sentence of the survey report makes this clear when it says:  "Over the course of eight years, Demand Gen Report's annual B2B Buyers Survey has spotlighted the ever-changing needs and expectations of the different stakeholders in complex purchasing decisions." (Emphasis added)

The Demand Gen Report survey, like most of the published research about B2B demand generation, deals with "high consideration" purchases that feature large buying groups, complex decision-making processes, and long buying cycles. But high consideration purchases have never represented all B2B buying.

Many B2B purchases are fairly routine, where the buying decision is made quickly by a small group of people, or even a single individual. In a 2018 survey of 114 "industrial buyers" by Thomas, over half (56%) of the respondents said they make buying decisions in less than one month.

While not much recent data is available, it's likely that more routine purchases account for a significant part of total B2B buying. In a landmark study of more than 3,000 B2B buyers conducted in 2009 by Enquiro, survey respondents estimated that 50% of their budget was spent on "Repeat" purchases - low-risk purchases that are made frequently and involve familiar products or services.

The reality is, most B2B companies derive revenue from multiple types of buying scenarios, and these scenarios will differ in significant ways. Understanding how these scenarios differ and what causes the differences is important because they call for different marketing and sales strategies. I'll provide a framework for analyzing buying situations in a future post.

Top image courtesy of ITU Pictures via Flickr CC.

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