Effective marketing for B2B brands

Transcription

1 Effective marketing for B2B brands Learnings from the IPA Databank Les Binet & Peter Field

2 Our research IN F CUS MARKETING EFFECTIVENESS IN THE DIGITAL ERA LES BINET ADAM & EVE DDB PETER FIELD PETER FIELD CONSULTING NEW LEARNINGS FROM THE IPA DATABANK In association with But do B2C rules apply to B2B marketing?

3 Six principles of growth 1. Build a strong brand 2. Expand your customer base 3. Maximise mental availability 4. Harness the power of emotion 5. Budget for growth 6. Balance your budget

4 1) Build a strong brand

5 Sales uplift over base The B2C model we re evaluating for B2B Sales activation Tightly targeted about to buy Short term sales uplifts Information works best Brand building Broadly targeted - all cat buyers Long term sales & margin growth Emotions work best Short term effects dominate ~6 months Time Source: Binet & Field 2013

6 Source: IPA Databank, B2B cases Number of very large biz fx. reported Brand building works harder than activation in B2B Activation/direct Brand building only Primary Campaign Objectives

7 The Economist: brand building for 14 years

8

9 2) Expand your customer base

10 Broad targeting works best in B2B ads Avg. no. VL biz effects Loyalty strategy - existing customers Acquisition strategy - new customers Broad reach strategy - all in the category Base: B2B IPA cases

11 3) Maximise mental availability

12 Mental availability drives B2C growth Awareness Salience Fame Heard of brand Brand comes easily to mind Brand gets talked about Passively consider brand Actively seek brand Cognitive ease, Influence & advocacy Increasing returns Fame increases B2C efficiency x 4 and maximises profit

13 Source: IPA Databank, B2B cases Mental availability drives growth in B2B Number of very large biz fx. reported Fame Awareness Other brand goals* Activation goals * Differentiation, brand image, esteem, trust or commitment Primary Campaign Objectives

14 4) Harness the power of emotion

15 Emotions are important in B2B decision making as well Relative importance of emotional vs. rational consideration 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 42% 32% 35% 35% 26% 30% B2C Source: IPA Databank, cases Sector B2B E > R E = R E < R

16 25% 20% 15% 10% 5% Information for activation, emotions for brand in B2B Activation effects Brand effects 0% Rational Emotional Comms strategy 0.0 Rational Emotional Comms strategy Source: IPA Databank, B2B cases

17 Differentiation is a weak strategy in B2B Number of very large biz fx B2B campaigns Fame Awareness Differentiation Source: IPA Databank, B2B cases

18 Emotional strategies clearly outperform in B2B 2.5 B2B campaigns 2.4 Number of very large biz fx Rational Emotional Fame Source: IPA Databank, B2B cases

19 BT business : the long-term power of emotions in B2B "The [consumer] campaign was all about human closeness and how communication brings people together. We realised, with all our technological advances, that this was something we'd drifted away from [in B2B], but something we wanted to get back to." Zaid Al-Qassab, CMO BT

20 BT business TV/Online: Be There OLV engagement rate vs. rational benchmark 3x CPA -17% ROI 316% Source: BT IPA case study 2018

21 Some common emotional B2B themes Humanity in a tech-obsessed world Your partner in a tough world We know it s lonely at the top Security in choice Champion of the entrepreneur FOMO

22 VW Commercial Vehicles: Working with You Targeting SMEs with an emotional proposition: Partners rather than sales people in a market still obsessed with telling drivers about product features.

23 VW Commercial Vehicles 2015 Cost per order -67% ROI 1053% Source: VW IPA case study 2016

24 5) Budget for growth

25 How brands grow: Bass Diffusion Model Sales Early phase Strong organic growth from: Innovation Physical availability Contagion Mature phase Growth naturally slows to zero Time

26 The role of advertising With ads Sales Ads can accelerate early growth Ads can maintain higher sales and margins. Budget increases can increase revenue further Without ads Time

27 But what about tech firms? Audited UK adspend million Uber Netflix Microsoft Google Facebook Ebay Apple Amazon Source: Nielsen

28 Budgeting for growth: The share of voice rule Share of voice 12% 10% 8% 6% 4% 2% 0% SOV > SOM: brands tend to grow Growth proportional to ESOV = SOV - SOM Strong correlation for B2B SOV < SOM: brands tend to shrink 0% 2% 4% 6% 8% 10% 12% Share of market

29 How ESOV converts into growth ESOV Efficiency Adjust budget for category & context Average +0.6% SOM p.a. per 10% ESOV 0.6 B2B very similar to B2C Retail FMCG Durables Financial services Sector Other Services B2C Average B2B Source: IPA Databank, cases

30 Adjust budget to fit pricing strategy Low prices accelerate growth Up-weight SOV for premium brands ESOV efficiency Value/mid-market 0.45 Premium/Super-prem Average ESOV 16% 14% 12% 10% 8% 6% 4% 2% 0% 6.1% Value 7.3% Mid market 10.4% Premium 13.8% Super premium Source: IPA Databank, for-profit cases

31 6) Balance the budget

32 Brand-activation balance matters Number'of'business'effects'reported' 2" 1.5" 1" 0.5" The 60:40 rule 0" 0" 10" 20" 30" 40" 50" 60" 70" 80" 90" 100" %'Budget'allocated'to'brand'building' Source: IPA Databank, for-profit cases

33 Optimum mix varies by category 100 Optimum budget split % Activation Brand 10 0 Financial services Retail FMCG Other services B2C Average B2B Source: IPA Databank, B2B cases

34 Optimum mix changes as brands mature 100 Optimum budget split % Activation Brand 0 First year Early growth* Mature brand Leader brand Source: IPA Databank, cases * New brands excluding 1 st year

35 Upweight brand to support higher prices 100% 90% 80% 70% % 50% 40% 30% 20% 10% 0% Value/mid-market Average (all cases) Premium % activation % brand Source: IPA Databank, for-profit cases

36 When activation is easy, focus on brand 100% Brrand/activation optimum 90% 80% 70% 60% 50% 40% 30% Activation Brand 20% 10% 0% All brands High online research Online selling Subscription selling Source: IPA Databank, for-profit cases

37 But what about tech firms?

38 Conclusions Limited data suggests B2B follows broadly similar patterns and effectiveness rules as B2C. Brand building seems to be important in B2B, but the optimum mix may need to be more activation heavy for some B2B brands. As with B2C, the optimum B2B strategy needs to be tailored to category and context. Strategy will probably depend on targeting too: SMEs vs Corporates vs dual B2B/B2C brands. Crucially, strategy needs to evolve over time, with brand investment becoming more important as the business matures and grows. Thank you