Monthly Archives: February 2010

B2B Marketing Principles 5: Customer data

There are two statistically proven rules in business. 1/ 80 % of your business comes from 20 % of your customers. 2/ It is far easier and more profitable to keep an existing customer happy than to try and replace them with a new one.

I think many businesses fail to keep these rules in mind, often seduced by the glamour and thrill of business development. More importantly, they fail to have an adequate control over and fail to best use the customer data they have on record.

Look at the chronology of data management. It is reasonable to argue that most companies start using paper based systems which lack finesse. In time they migrate to Excel or another simple data capture program. At some point they are convinced of the need for an expensive and complicated system like Salesforce.com or Project Sales Achiever of which they use about five percent of the functionality. Every additional tool becomes a chargeable bolt on.

Some companies operate all of the above and end up with no centralised system for capturing customer, former customer, prospect, supplier and partner contact details and contact history.

The benefits of database marketing are undeniably clear – accurate, relevant, timed, personifiable communications with responses tracked and evaluated. But it takes time and costs money.

In the niche B2B arena where the universe containing your target universe is probably small, a database becomes ever more critical. Lists relevant to your business are increasingly harder to purchase so you really have to look after every single lead you ever receive. Even those that are not financially viable for you to convert may still be a useful contact if you consider potential access to their contact pool.

Planning and logging communications and tailoring them with known enquiry and/or transactional data gives you an incredibly powerful profile of each customer and provides insight into what interests them and what potential future requirements might be, meaning you can constantly pre-empt them and keep them satisfied.

Apply a little Tesco magic. Their Clubcard is the main driver in them owning £2 in every £5 of high street grocery spend.

Use cost effective database and CRM packages like DotMailer, Constant Contact or MailAgent, supported by communication platforms like Basecamp which keep all project correspondence in one place.

Why? You look professional. You are engaging. You are in control. You are trusted. You are a partner and therefore more difficult to replace.

Image from http://www.tyson-consulting.com (David Waddington)

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Going social

There is natural suspicion and confusion about the importance and return on time spent on developing your online brand using ‘social media’.

Recent high profile news stories involving Manchester United banning their players from Twitter and Coca Cola issuing guidelines on Twitter use demonstrate how leading brands remain nervous the interactive and uncontrollable nature of the medium.

Even the terms of reference – ‘social media’ and ‘social marketing’ – are themselves misleading titles for the technology that allows you to build contacts, links, friends, followers and fans on the major networks. (In marketing circles, social marketing typically refers to campaigns built around public awareness, public information and or public safety).

Companies are pondering whether there is a return on investment from social media, or if it is just a gimmick.

The simple undeniable truth is that the Internet is here to stay. It is the first resource for suppliers, customers, job seekers and anyone researching a purchase or looking for a recommendation.

Sites like Linkedin, Facebook, Twitter, Flickr and YouTube attract users in their millions for strong psychological reasons, namely the need to belong and share.

The plethora of experts queuing up to offer advice fall into two camps. They either tell everyone they should be doing it, or telling most people not to bother. I believe elements of social media can be useful to everyone and every type of business or organisation.

Careful and coordinated use of some of these resources can give you untold visibility, help give you and your enterprise credibility, help you engage with customers, prospects and suppliers, and drive traffic to your website and aid conversion. Check out this post from September 2009 if you are starting out now.

Think strategically, start small, and don’t spend a whole amount of time on it. That way, going social can be effective for you.

B2B Marketing Principles 4: The B2B value proposition

The drive to write a blog series about B2B marketing came from a realisation that there remains little clear information and guidance on effective B2B marketing in the UK. There are few books on the subject (believe me I’ve checked Amazon), one magazine (B2B Marketing) and a few discussion groups in places like Linkedin. There are a small handful of agencies and specialists attempting to drive best practice.

I even approached the CIM about creating a B2B interest group (there isn’t one) and they are yet to get back to me.

I believe that, as a B2B marketer, you are looking for strategies and approaches to give your business the best chance of break through, the best chance to stand out from other commodities. So how can you standout in a B2B market?

Beating the commodity trap demands an appreciation of who are presenting to (target audience), understanding what they want (their needs), their concerns and trigger points (objections) and ultimately presenting yourself in the best most favourable light to secure the supply contract.

To provide the most favourable offer means being able to deliver what is expected and then some. It is often the ‘and then some’ that secures a contract win. But such an indefinable element means you have to think long and hard about your value proposition. In light of what you know about your customer, consider the following value propositions. Bear in mind the quality, speed, price conundrum; you can only really offer two of these.

1. Be the fastest – ProntaPrint provides on the spot print and collation services to businesses. It is priced slightly higher than other print providers because you can have collateral printed immediately at hundreds of high street locations.

2. Offer the most choice – Wolseley supplies the building and plumbing trades with product lines running into the tens of thousands through their nationwide network of Build Centres, Plumb Centres etc.

3. Provide the most customisation – Dell allows you to customise your computer purchase online, add a range of extras and add discounted peripherals and accessories. You receive a bespoke computer, though it does tend to take a while to arrive.

4. Be the expert – KPMG help thousands of businesses audit their accounts and ensure their financial affairs are in order and comply with financial and legal and requirements. As a professional service they are arguably unrivalled.

5. Be the largest – Microsoft support their global domination of the PC software market with accredited partner schemes meaning there are millions of Microsoft certified experts supporting businesses with their IT needs.

6. Provide the best quality – quality in the sense of design, performance, finish and process (ISO9001). This might be related to total product (Bentley, Apple) or individual components.

7. Provide the best service – service from a customer experience perspective. Is your website easy to browse and automated to the extent of Amazon. Are your staff fully conversant with brand values and company mission? How is your service delivered – instore, online or through channel partners and distribution?

8. Be the most informative – Google Adwords, whether you love them or hate them, have done a great job in advancing take up of the advertising scheme with Google University sessions and seminars at hundreds of events every year. They show the product in use, allow people to trial, ask questions and get a feel for it, resulting in much higher take up than might have been the case.

Business experts always say focus on what you are best at. Above all, avoid being the cheapest. Price differentiation positions you as a commodity proposition. Consequently, you provide little value and can be easily replaced.

What value do you add?

Image: http://blog.perksconsulting.com

B2B Marketing Principles 3: The specifier

We know that there is more than one buyer involved in most B2B transactions, and that positioning your offer to the right people is critical. Different influences come to bear from different perspectives, and you as the marketer are missing a big trick if you don’t try to convince them all to select you.

Whilst in some B2B transactions, the rise of procurement may be the biggest challenge to some suppliers, I think the biggest and clearest opportunity sits with the specifier. Convince them that you have what it takes and you are on to a winner.

There are often two types of specifier to consider, the specifier within your customer company, and industry specifiers. I’ll explain what I mean and why you need to target both.

Take construction for example. You want to supply materials to the major house, school and hospital building contractors in the UK. Going direct is tricky because of the decentralised structure of materials procurement in most of these companies. Why? They have regional project managers who source what they need on a project or site basis. But they draw information and recommendations from architects, surveyors and other industry professionals. These professionals provide thought leadership on building standards, sustainable building and the contractors take their recommendations about materials very seriously.

Given the preferred supplier nature of this market, and the need to tender and get a place on the list, advertising and direct selling is only going to help suppliers so far. That’s why testimonials and credentials selling is more relevant and the key to this is using third party endorsement of your offering. In construction the architect and surveyors (designers and specifiers) are key players.

But what about the specifier standing between you and a sale? ‘He’ responds to your marketing and sales messages and seeks to balance this with impartial information from the community. He often knows what he wants and needs to validate his selection to the other influencers on the decision to purchase. He needs to present cast iron benefits for why your product or service will meet his company’s specific requirement. You need to solve a particular problem, and more commonly, provide some form of return on investment or reduced exposure over a given period of time. That way he knows he is making the right decision for himself and his company.

So, knowing who the user is not enough. Find out who the specifier is, meet their needs, support them in advocating your solution, and you stand a better chance of business success.

Do you actively target and develop relationships with the specifiers and best practice leaders in your market?

Image: http:// salesmanage.com

B2B Marketing Principles 2: Effective targeting

Kevin Roberts, CEO with Saatchi & Saatchi is right when he says we should forget B2C and B2B and focus on people to people marketing (CIM The Marketer, Feb 2010). Though we are indeed steaming through the era of permission, engagement and trust marketing on a global scale, significant differences remain in marketing to companies and directly to consumers.

In my main Principles of Marketing series, I start with the customer. The same is true in B2B Marketing, admittedly with an important difference.

In consumer marketing, you can tailor a functional feature to provide an emotional benefit and tie consumers to your brand through a number of rational and irrational benefits. This is more difficult in B2B due to two factors 1/ the buyer is not spending their own money and 2/ there are a number of influencers upon the decisions involved in specifying, selecting and procuring a given product or service.

Do all companies that operate in this environment understand these key differences? I’m not sure most at the SME level actually do. Traditional trade and technical marketing focused on users, and then to some extent specifiers when it became necessary.

This is lazy, outdated and high risk. Companies should proactively go beyond the end user and the guy who writes the cheques, and target everyone who impacts those decisions. Increasingly, procurement managers dictate what is to be purchased and negotiate best price, and there are other camps to swing too. So whether you like it or not, a main challenge in B2B is to differentiate your offering from others, and avoid the commodity trap, and pricing pressures that come with it.

B2B marketers should avoid getting into a commodity pitch by creating advocates on the customer side. A value added sell needs to be positioned to everyone in the chain if you stand a chance of being selected. This means understanding the needs, trigger points, and obstacles of everyone involved in the decision making process.

Effective communication and customer engagement starts with firmly understanding who your customer is, whether they look at your offering from a technical, HR, logistical, sales, data, quality, safety, financial or a board level perspective.

Marketing is ultimately about delivering the right message to the right person at the right time in the right way. So in order to achieve this, understanding how your customer as a business buys products like yours, the people involved and the process used, will allow you to communicate what you offer, and the value partnering with you can add.

Final thought: When was the last time you mapped all the possible customer contacts and influences on your sale within one of your key customers or clients? And do you have a grasp of what each of these people are looking for and what will motivate or encourage them to buy from you?

Image from Imageshack

B2B Marketing Principles 1: Introduction

Business to business (B2B) marketing is traditionally seen as more complicated and less glamorous than consumer marketing. There is no doubt that large UK b2b brands like BT, FedEx, The Co-op, ProntaPrint, Royal Mail, and RIBA employ more creative marketing planning and execution, and perhaps embrace emerging technology a little more.

For most B2B companies however, marketing is often seen as a necessary evil, an unavoidable cost required to support the sales effort. Marketing delivered from this starting point is always less likely to succeed because crucial planning elements are overlooked.

Practitioners often claim that B2B marketing is difficult due to complex, multi-layered decision making, the role of influencers, the existence of elongated channel and distribution routes to market, the need for bespoke product and service specifications, the rise of the procurement manager and the commodity purchase, and the combination of a range of tangible and intangible partnering benefits. These excuses, more often than not, lead to poorly propositioned, poorly designed communications which are delivered to buyers who are presumed to lack sophistication.

I put it to you on this blog that the buyers of your products and services are sophisticated. They use sites like Amazon, Google, Facebook, Lastminute, buy products from companies like Apple, Gap, Levis, and Starbucks and consequently understand good, well propositioned brand and marketing communications, are looking for a good customer experience and demand excellent service.

You do them and yourself a disservice by hiding behind sector conservatism and not challenging your market by standing out and being different.

The 10 part B2B Marketing Principles blog series being provided over the coming weeks by The Marketing Assassin will distil the best and most recent thinking in B2B marketing, highlight critical elements to consider and provide a checklist of common mistakes to avoid.

To whet your appetite, visit the Business Superbrands website to see interesting business Superbrand case studies.

Image: Robert Rosenthal’s blog

The real reasons behind Sickie Monday

According to research conducted by Management Today, the first Monday in February statisically results in more employees calling in sick than any other day of the year. An estimated 350,000 people in fact.

And I say ‘calling’. A quarter will text or email to avoid making that call.

If you made it into work, well done you.

If not why not? Dark and cold outside? Swine flu? Hungover? Wanted a long weekend? Needed a break after a hard first month back? Boss from hell? Company drifting along without real purpose? Generally uninspired and wanting to do something else? Fancied a day sprucing up your CV and getting it posted on the job boards?

Whatever the reason, you’ve probably lost commitment to your current role.

I believe that employees want to work in creatively stimulating environments, under managers that are inspirational in their leadership and firm in their direction and strategy for the business. And in a business that communicates its strategy and milestones regularly and rewards its staff on a meritocratic, not time served basis. When these things aren’t in place, the best staff inevitably look elsewhere.

If more workplaces were like this, I think it would start to cut the costs of absenteeism, and achieve greater levels of productivity.