Whitepaper Review by ADMA
This B2B Marketing Outlook Report 2011, conducted by Green Hat, confirms many long-held suspicions of B2B marketers about the differences between B2B and traditional B2C marketing; changes in B2B priorities, the impact of digital channels on marketing practices along with some new challenges and issues are rising to the surface.
Digital Marketing is Rising
Spend on digital marketing in 2011 was greater than predicted and in 2012, survey respondents plan to increase it again. At this rate of growth, the report says that digital is expected to “overtake traditional marketing in terms of budget share as the highest spend category during 2014”.
Traditional Moves Towards Measurability
The rise in digital marketing is at the expense of those traditional marketing activities that are harder to measure. Advertising takes a hit again, with “37% of organisations that run print advertising planning to do less in 2012, or stop altogether”. This is also reflected in reduced 2012 budgets for advertising (excluding online) and sponsorship.
Marketing Budgets Rise
While around half of 2012 B2B marketing budgets are similar to the prior year, nearly “40% will be larger, with one in seven at least 20% larger than in 2011”. Generating leads is still the major focus of B2B marketing, although less people appear to think so this year. It still tops marketing objectives and share of budget, and was also the reason most used to justify marketing budgets.
Talking to People we know
A major shift in this year’s results is the increased emphasis on activities that address contacts already in the database such as lead nurturing, e-newsletters and email (assuming to opted-in contacts). This is also reflected in the increased significance of up-sell and cross-sell in B2B marketing objectives.
Marketing & Sales Integration
According to the report, sales are arguably “not following up enough leads and marketing has insufficient visibility over what happens to them, losing track of over a quarter (27%)”. Only around a third of marketers (35%) are able to report that “more than 80% of leads generated were followed up by the sales team”.
According to the report, measuring marketing ROI has increased significantly this year. Too many respondents reported that sales do not provide marketing with information on how many leads are followed up or converted to orders – which supports the previous finding that marketing/sales integration needs focus. However, given that ‘cost of lead’ is determined by dividing the cost of a marketing activity by the number of resulting leads, the answer is not dependent on effectiveness of sales reporting but lies within marketing itself. According to a widely quoted statistic from a 2008 survey by the Aberdeen Group, 70% or more of B2B leads are never followed up by sales. At least this research doesn’t reflect that depressing statistic but unfortunately, this factor still appears to be a major source of lead pipeline leakage in many organisations, with only one in three sales teams following up at least four out of five leads. Organisations with a typical sales lead time of 1-3 months appear the most successful in preventing leakage, with nearly a half (49%) saying that “80%+ leads are accepted and followed up, twice that of those with a typical sales lead time of under a month”. The fact that 17% of respondents convert two out of five leads to orders may be taken as a positive – especially given the number of leads not followed up by sales. However, it is a concern that some 60% of respondents were reporting a conversion of one in five or less, or didn’t know.
Overall, from the report, it’s clear that Australian B2B marketers plan to do more via social marketing in 2012. Lagging behind this growth is proof that Social Media actually delivers ROI, with only 7% of respondents reporting good ROI results, and four times that number saying they are not happy with their social marketing results. Despite this, none who have started plan to stop and only 7% plan to do less in 2012. In terms of platforms, LinkedIn remains the dominant platform for B2B Social Media marketing (used by 75% of respondents), although the fastest growing platforms since the 2011 survey are Twitter and YouTube.
B2B Marketing Objectives
When comparing the 2012 results to previous years, the primary objective remains the same; to generate leads. However there are also some significant changes in this year’s results. In particular, respondents have increased the importance given to up-selling and cross-selling to current customers, as well as measuring marketing ROI. It is assumed that, because of this change in emphasis, maintaining the contact database currency and quality has also taken on more significance. The good news is that the vast majority of Australian B2B businesses are increasing – or at least maintaining – their level of investment in marketing. Also encouraging is the trend towards lead nurturing and lead management, which demonstrates that marketers are taking responsibility beyond demand generation, and working towards the delivery of better qualified leads to the B2B sales force.
Greenhat are hosting a webinar that will explore the findings of the B2B Marketing Outlook 2012. Attendees will receive a no-charge copy of the 24-page report – which is the most comprehensive commentary on the B2B marketing landscape in Australia. The webinar is on Thursday 19 April 2012 from 12 noon to 12:45pm. Andrew Kent from Greenhat and Executive of ADMA’s B2B Expert Group, will lead the discussion with commentary from a panel of industry experts. Register for the webinar if you would like to learn more about: • The growth and importance of digital marketing in the B2B mix • The key marketing challenges including lead management and nurturing • Social media – most are trying social media but few are succeeding • Benchmark metrics – cost/lead and lead conversion rates • Trends with marketing budgets