B2B Marketing Needs A Makeover: New Findings from Forrester Research and MarketingProfs Online Survey
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1 1 B2B Marketing Needs A Makeover: New Findings from Forrester Research and MarketingProfs Online Survey Laura Ramos Vice President Forrester Research 3:15 pm to 4:30 pm, October 2, 2007 For a copy, visit: /MarketingProfsOctober Agenda What is the state of B2B marketing? What trends emerge in B2B tactic use and are B2B marketers taking full advantage of interactive approaches? What is the B2B marketing budget outlook and key trends for 2008? What budgeting best practices should B2B marketers improve upon? 3 Entire contents 2007 Forrester Research, Inc. All rights reserved.
2 2 Where are B2B marketers today? 4 Entire contents 2007 Forrester Research, Inc. All rights reserved. B2B struggle to reach decision makers What are your top five B2B marketing challenges? Reaching decision-makers 54% Measuring marketing results 53% Improving lead quality 48% Generating more leads 44% Working within budget constraints Deepening relationships with customers Developing the company s brand 37% Increasing product awareness 37% Improving data quality and availability 28% Understanding prospect behavior 27% Retaining customers/developing loyalty 25% Improving partner relationships 21% Improving relationship with sales Allocating the marketing budget 16% Base: 569 B2B marketers (multiple responses accepted) Source: Forrester s Q Business-To-Business Marketing Effectiveness Survey *Source: Forrester, April 8, 2005, Trends What B2B Marketers Need From Technology 5 Entire contents 2007 Forrester Research, Inc. All rights reserved.
3 3 Challenge: map marketing tactics to buying cycle Contacts Reach Interest Desire Convert Enrich Retain Lifetime customers B2B activity starts much earlier in the buying cycle Amount of research activity Buyers return to to validate findings and substantiate or support business case Reach Interest Desire Convert Enrich Retain 6 Entire contents 2007 Forrester Research, Inc. All rights reserved. B2B purchase process stages (time) In 2006, B2B marketers cling to traditional tactics Which of the following marketing tactics does your marketing organization use? Public relations Print advertising Executive seminars and events Sponsorship Inside sales/telemarketing Online display ads (banners, pop-ups) Search marketing Emerging online tactics (RSS, blogs, podcasts) Rich media ads or Internet video Outdoor media Trade shows 91% 89% 87% 78% 77% 74% 73% 72% 70% 62% 59% 37% 28% 24% 22% Base: 569 B2B marketers Source: Forrester s Q Business-To-Business Marketing Effectiveness Survey 7 Entire contents 2007 Forrester Research, Inc. All rights reserved.
4 4 Are B2B marketers going digital? Q3 Marketing Effectiveness and Spending Survey FY 2006 revenue Don t know prefer not to say 11% > $5 Billion 9% $1B to $4.9B 11% $500M to $999.9M 5% $100M to $499.9M 14% $20M to $99.9M 17% Base: 242 marketing professionals FY 2006 marketing budget Prefer not to say 10% < $20 Million 34% Don t know 14% > $100 Million 3% $10M to $99.9M 7% $5M to $9.9M 4% $1M to $4.9M 23% < $1 Million 38% 8 Entire contents 2007 Forrester Research, Inc. All rights reserved. Are B2B marketers going digital? Other marketing position 17% Marketing director 37% Respondent title Senior-most marketing exec Other senior exec 12% Marketing exec 14% Finance & insurance 6% Retail & wholesale Media, 7% entertainment, travel & leisure 7% Manufacturing 17% Industry Public sector 4% Utilities & telecom 3% High-tech 18% Business services 38% 9 Entire contents 2007 Forrester Research, Inc. All rights reserved. Base: 242 marketing professionals
5 5 2007: Key interactive tactics move ahead Which of the following marketing tactics does your marketing organization use? Public relations Tradeshows Search marketing Print advertising Inside sales/telemarketing Executive seminars and events Sponsorships Online display ads Online video, podcasts, or rich media Other Web 2.0 media Outdoor media 10 Entire contents 2007 Forrester Research, Inc. All rights reserved. 86% 78% 71% 67% 42% 32% 28% 32% 37% 29% 12% 24% 12% 10% 22% Base: 221 marketing professionals 62% 61% 59% 56% 54% 53% 77% 70% 74% 73% 72% 62% 87% 89% 91% 78% 59% Most tactics lost share in 2007 Many popular tactics fail to build brands Brand awareness Percent of firms that say tactic is highly effective 80% Niche Popular Outdoor Most Effective Less Effective Other Web 2.0 Video/podcasts Online ads PR Exec seminars Tradeshows Print Sponsorships Search mktg Inside sales 0% 0% 80% 100% Percent of firms that use each tactic Base: 224 B2B marketers 11 Entire contents 2007 Forrester Research, Inc. All rights reserved.
6 6 The picture looked very similar in 2006 Brand awareness Percent of firms that say tactic is highly effective 80% Niche Popular More effective Outdoor Less effective Rich media Emerging PR Print Exec seminars Sponsorship Trade shows Search marketing Online ads Inside sales 0% 0% 80% 100% Percent of firms that use each tactic Base: 569 B2B marketers Source: Forrester s Q Business-To-Business Marketing Effectiveness Survey 12 Entire contents 2007 Forrester Research, Inc. All rights reserved. What moved? and online ads gained; Fewer tradeshows but better value Percent of firms that say tactic is highly effective 80% Brand awareness Niche Popular PR More effective Outdoor Less effective Web 2.0 Print Trade shows Rich media Video/ podcast Search marketing Online ads 0% 0% 80% 100% Percent of firms that use each tactic 13 Entire contents 2007 Forrester Research, Inc. All rights reserved.
7 7 Seminars, insides sales generate the best leads Generating leads Percent of firms that say tactic is highly effective 80% Niche Popular Most effective Less effective Exec seminars Inside sales Tradeshows PR Video/podcasts Other Web 2.0 Outdoor Online Sponsorships ads Print 0% 0% 80% 100% Percent of firms that use each tactic 14 Entire contents 2007 Forrester Research, Inc. All rights reserved. Search mktg Similar results found in 2006 survey Generating leads Percent of firms that say tactic is highly effective 80% Niche Common B2B marketers find that personal contact drives leads. Higher regard Lower regard Search marketing Exec seminars Inside sales Trade shows PR Online ads Rich media Sponsorship Emerging Outdoor Print 0% 0% 80% 100% Percent of firms that use each tactic Base: 569 B2B marketers Source: Forrester s Q Business-To-Business Marketing Effectiveness Survey 15 Entire contents 2007 Forrester Research, Inc. All rights reserved.
8 8 Results show reaching DMs and generating demand become more difficult Percent of firms that say tactic is highly effective Generating leads 80% Niche Common Higher regard Lower regard Rich media Video/ podcasts Other Web 2.0 Emerging Search mktg Online ads Exec seminars Inside sales Trade shows 0% 0% 80% 100% Percent of firms that use each tactic 16 Entire contents 2007 Forrester Research, Inc. All rights reserved. 1-1 tactics best communicate messages, offers, and promotions with existing customers Percent of firms that say tactic is highly effective 80% Niche Common Exec seminars Higher regard Inside sales Lower regard Online video/podcasts Other Web 2.0 Tradeshows PR Outdoor Online Sponsorships Print ads Search marketing 0% 0% 80% 100% Percent of firms that use each tactic Base: 224 B2B marketers 17 Entire contents 2007 Forrester Research, Inc. All rights reserved.
9 9 Why Web? Decision makers rely on it Which information sources do IT decision makers rely on to make or substantiate product decisions? Websites Sales Interactions IT peer advice Search engines Tech magazines Collateral Conferences Trade groups Peers outside IT Tech blogs Industry magazines Analysts 49% 61% 59% 57% 69% 65% 72% 70% 70% 78% 75% In a similar study: 48% of 580 decision-makers said Web sites and peer advice were most effective when validating purchase decisions. Base: 119 CIOs Source: March 2007, Trends CIOs Lean On Web Sites To Make IT Product Decisions 18 Entire contents 2007 Forrester Research, Inc. All rights reserved. What does it mean? B2B marketers are being more selective about traditional and interactive tactics The digital shift continues in B2B Integrate digital and traditional tactics to drive buyers to Web sites Influencing customer testimonials and peer perception is the new challenge Do spending and budgeting reflect the digital shift? 19 Entire contents 2007 Forrester Research, Inc. All rights reserved.
10 10 Outlook for 2008 budgets: Optimistic! By how much do you expect your overall marketing budget to change for 2008 (include programs, salary and capital investment)? Avg. decrease = 18% Decrease 6% Avg. increase = 24% No change 45% Increase 50% Base: 242 marketing professionals 20 Entire contents 2007 Forrester Research, Inc. All rights reserved. Tradeshows, and mail top spending list What percentage of your marketing budget is dedicated to each tactic? Tradeshows PR Inside sales Print ads Search mktg Executive events Other Sponsorships Online ads Video/podcasting Web 2.0 TV Outdoor Base: 207 marketing professionals 0% 2% 4% 6% 8% 10% 12% 14% 21 Entire contents 2007 Forrester Research, Inc. All rights reserved.
11 11 Interactive tactics move ahead in B2B spending plans How will your 2008 spending on the following marketing tactics differ from 2007? Increase spending Video, podcasts, rich media Other Web 2.0 media Search marketing Online display ads Plan to start spending Decrease spending 0% 80% 100% Base: 207 marketing professionals 22 Entire contents 2007 Forrester Research, Inc. All rights reserved. Traditional tactics lose relative to interactive, 1-1 How will your 2008 spending on the following marketing tactics differ from 2007? Executive seminars Public relations Inside sales/telemarketing Sponsorships Tradeshows Outdoor media Print advertising Increase spending Plan to start spending Decrease spending Base: 207 marketing professionals 0% 80% 23 Entire contents 2007 Forrester Research, Inc. All rights reserved.
12 12 Which marketing departments control the budget? Please indicate what percentage of your overall marketing budget you dedicated to each of the following areas in Field marketing Product marketing Branding/advertising Corporate communications Channel/Partner marketing Marketing operations Marketing research Inside sales/internal telemarketing Other Total 17% 17% 16% 12% 9% 9% 7% 7% 6% 100% Avg. of $1B+ firms: 21% Field Marketing 15% Product Marketing 15% Branding/advertising 8% Corporate comm. Base: 224 marketing professionals 24 Entire contents 2007 Forrester Research, Inc. All rights reserved. Corporate controls the interactive budget, field marketing controls events Please indicate which area of marketing holds primary responsibility for budget and execution of each tactic? Field mktg Corp. Com. Product mktg Branding/ Channel advertising Executive seminars Tradeshows Online display ads Online video / podcasts Other Web 2.0 media Search marketing 0% 80% 100% Base: 62 to 149 marketing professionals 25 Entire contents 2007 Forrester Research, Inc. All rights reserved. Other
13 13 Product mktg investment expects to drive innovation How do you expect your 2008 non-program spending on the following marketing functions to differ from your 2007 spending? Product marketing Marketing operations Branding/advertising Channel/Partner marketing Corporate marketing Marketing research Field marketing Inside sales/ internal telemarketing 0% 10% 30% 50% Base: 209 Marketing professionals Increase spending Decrease spending 26 Entire contents 2007 Forrester Research, Inc. All rights reserved. Status quo dominates B2B planning practices % of respondents who Strongly Agree with the following: We base budgeting decisions on program track records and prior spending We plan effectively because we track program spending Our marketing mix models let us plan our budget effectively 0% 10% 30% 50% 70% 80% Base: 207 Marketing Professionals 27 Entire contents 2007 Forrester Research, Inc. All rights reserved.
14 14 Data-driven planning practices play catch-up % of respondents who Strongly Agree with the following: We tie increases in marketing dollars to revenue, customer growth, market share We can change budgets quickly if ROI shows tactics aren t achieving goals We base budgeting decisions on hard data about marketing tactic effectiveness Base: 207 Marketing Professionals 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 28 Entire contents 2007 Forrester Research, Inc. All rights reserved. Summary and Recommendations While B2B marketers are adopting interactive tactics, it s time to pick up the pace.» Combine interactive with traditional tactics to build customer dialog and engagement» Start with , search marketing, and webinars. Field and product marketing control rising 2008 budgets.» Corp comm must demonstrate value of emerging Web 2.0 tactics to move interactive to the next level» Integrating demand generation with interactive will build prospect engagement and quality Interactive helps marketing move from tactical to strategic. 29 Entire contents 2007 Forrester Research, Inc. All rights reserved.
15 15 Current Research September 26, 2007 Best Practices: B2B Marketing Measurement August 10, 2007 Redefining B2B Marketing Measurement May 15, 2007, Best Practices Making B2B Marketing Customer-Centric April 18, 2007, Trends B2B Marketers Must Measure Lead Gen Costs March 5, 2007, Trends CIOs Lean On Web Sites To Make IT Product Decisions February 22, 2007, Best Practices Marketing s Role In B2B Blogging August 2, 2006, Trends B2B Marketing Needs A Makeover Now June 20, 2006, Best Practices The B2B Search Marketing Playbook 30 Entire contents 2007 Forrester Research, Inc. All rights reserved. Thank you Laura Ramos / lramos@forrester.com For a copy of this presentation and a complimentary report, please visit: /MarketingProfsOctober Visit our marketing blog at: 31 Entire contents 2007 Forrester Research, Inc. All rights reserved.
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