STATE OF B2B PRODUCT MARKETING 2015

STATE OF B2B PRODUCT MARKETING 2015 Research Report - March 2015

WHO WE SPOKE TO To understand the state of product marketing in B2B companies, we spoke to senior marketers on current trends and practices in the field. The companies we spoke to were spread across various product types ranging from Software (72%) to Hardware (23%), Cloud (50%) and Mobile (28%). A majority of the companies were in the technology sector. While 67% of the companies were from the US, the rest were from across the globe. REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 01

KEY FINDINGS: 89% marketers mention new customer acquisition as the metric they use to measure the impact of product marketing» tweet this «84% respondents say they invest in product marketing» tweet this «81% executives choose direct selling as their top sales distribution strategy» tweet this «70% respondents say they look at revenue generated to measure the success of a product launch» tweet this «69% marketers choose understanding buyer needs or pain points as the most important go-to-market strategy to a product launch» tweet this «REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 02

PRODUCT TEAMS LEAD PRODUCT LAUNCH ACTIVITIES 76 percent of the companies identified their product teams as owners of product launch activities within the company. Which of the following teams own product launch activities in your organization? Product marketing team 53% Product management team Corporate marketing/ Marketing communication team 23% 22% Public relations team 2% REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 03

MAJORITY OF COMPANIES INVEST IN PRODUCT MARKETING 84 percent of the respondents said their companies invested in product marketing; 16 percent said they didn t. Does your organization invest in Product Marketing? 84% Yes 16% No REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 04

CREATING MARKETING COLLATERAL & ENABLING SALES TOP THE LIST OF ACTIVITIES CARRIED OUT IN PRODUCT MARKETING 80 percent of marketers we spoke to chose creating marketing collateral as an activity that they carry out to achieve their product marketing goals; while the same figure for sales enablement stood at 70%. While it was encouraging to hear 67% of our respondents mention market research as part of their product marketing initiative, we were surprised to find a lack of such enthusiasm when it came to collecting product feedback & measuring product satisfaction, which scored a low 48%. Given the current relevance of lean business practices and the minimum viable product, increased focus on product feedback might be necessary for future product successes. REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 05

Which of the following activities do you carry out to achieve product marketing goals? Creating marketing collaterals Sales enablement 71% 80% Defining positioning 70% Creating marketing plans 70% Launch planning 69% Market research Creation and execution of Go-To-Market plans 67% 64% Lead generation 59% Understanding the sales process 58% Buyer persona 57% Managing marketing programs 53% Channel/ Partner enablement 51% Collecting product feedback and measuring product satisfaction 48% Building awareness plans 45% Win/ Loss analysis 44% Measuring the ROI of marketing program 42% Building customer acquisition plans 28% Building customer retention plans 27% REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 06

UNDERSTANDING BUYER NEEDS IS THE MOST CITED GO-TO-MARKET STRATEGY 69 percent of respondents picked understanding buyer needs or pain points as the most important go-to-market strategy to a product launch. Enabling the ecosystem came next at 58%. Only 21% of marketers chose working with a marketing agency for creative writing/ ad campaign as important to their product launch; sending a gentle reminder to agencies to relook at the role they currently play in product marketing and see how they could make themselves strategically more relevant to the client s needs. REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 07

Which of the following go-to-market strategies are most important to your product launch? Understanding buyer needs or pain points Enabling the ecosystem (sales, channel, partner, support, renewals, etc) Creating demos/ launch videos for analyst/ PR/ partners/ channel 58% 55% 69% Defining effective communication plan 51% Identifying your target addressable market Engaging prospects 49% 44% Establishing your brand 28% Feedback collection 28% Message testing 27% Working with marketing agency for creative writing/ ad campaigns Creating formal and social connect platform 21% 20% Creating viral landing Page 15% Creating microsite 12% Enabling pre-orders 11% Establishing Directly Responsible Individual matrix 9% REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 08

WEBSITE & EMAIL ARE THE MOST POPULAR DIGITAL CHANNELS THAT COMPANIES RELY ON FOR MARKETING THEIR PRODUCTS Besides Website and Email, preferences on the list chosen by our respondents, include Webinars, Social Media, Search and Blog. Mobile finds less favour with our marketers. This trend was evident even in our earlier study on the State of B2B Marketing 2015. Which of the following digital channels does your organization tap into for marketing its product? Website Email 91% 89% Webinars 77% Social media 76% Organic search (SEO) Blog / Microblog 64% 62% Paid search (SEM) 59% Digital banners 57% Online display ads 43% Micro-websites 40% Mobile web & apps 28% Affiliate marketing 24% Mobile campaigns 15% REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 09

81 PERCENT OF MARKETERS CHOOSE DIRECT SELLING AS THEIR TOP SALES DISTRIBUTION STRATEGY Direct selling included both online and offline selling. Channel partners came a distant second at 41%. What is your top sales distribution strategy? Direct selling (online & offline both) 81% Channel partners 41% SaaS / Cloud based 24% Telesales 17% Value Added Resellers (VARs)/ Interim Sales Representative (ISRs) Managed service Selling through intermediaries (consist of wholesalers, retailers etc) 16% 11% 9% Wholesale & retail sales 5% Dual distribution (eg: franchisers etc) 2% Reverse channels 0% REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 10

LINKEDIN & TWITTER ARE THE MOST PREFERRED SOCIAL MEDIA PLATFORMS LinkedIn at 81% and Twitter at 71% lead the way as the most sought after social media platforms for a product launch. With increasing interest being shown on video as a content type in the B2B space (Source: State of B2B Content Marketing 2015), we anticipate YouTube to soon beat Facebook to third place. What are your top social media platforms for product launch? LinkedIn 81% Twitter 71% Facebook 54% Youtube 54% Google+ 17% Slideshare 17% Pinterest 5% Other 5% REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 11

TRADE SHOWS DOMINATE OFFLINE CHANNELS IN LEAD GENERATION 71 percent of respondents chose Tradeshows as the offline channel they used for generating leads and creating a pipeline. Promotional events came in next at 51% followed by partners at 50%. Except for Print media (30%), which offers the option of niche technical journals for targeted communication, other mass media alternatives like Television, Radio and Outdoor advertisements have little significance in B2B product marketing. What are the traditional/offline channels used by your organization for leads or pipeline generation? Trade shows 71% Promotional events 51% Partners 50% Direct mail/ Snail mail 38% Print media 30% Television 5% Radio 5% Outdoor advertisements 4% Franchisees 0% REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 12

MAJORITY OF CHANNELS FIND FAVOR DURING THE GROWTH PHASE OF THE PRODUCT LIFECYCLE This includes all the popular channels that were preferred by our respondents including Website, Social media, Email and Trade shows. The exceptions include Print media, Direct mail, Online display ads and Public relations which found greater favour among the marketers during the introductory phase of the product lifecycle. Only Television and Radio were found to be more suitable during the decline phase than at any other stage of the product lifecycle. While the intention to get the audience back through the broadcast media is understandable, the cost efficiency of such an exercise during the decline phase is questionable. Interestingly, there appears to be a sharp surge in the need for Affiliate marketing during the growth phase of the product; a pointer, perhaps, to the strategic role that it could play in the growth plan of organizations. REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 13

Please map the marketing channels based on their suitability of usage during the various phases of the product lifecycle Introductory Growth Maturity Decline 71% 74% 57% 18% 58% 52% 23% 19% 79% 85% 77% 36% 70% 83% 74% 40% Events/ Trade Shows Print media Website Email 59% 53% 25% 31% 57% 79% 43% 17% 77% 85% 50% 17% 68% 63% 34% 11% Direct mail Search marketing Social media Online display ads 25% 71% 46% 17% 57% 73% 50% 13% 50% 54% 29% 14% 13% 38% 19% 44% Affiliate marketing Mobile web & apps Mobile campaigns Television 27% 20% 13% 53% 52% 64% 42% 24% 67% 63% 44% 9% Radio Telemarketing Public relations REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 14

PRODUCT VIDEOS SEEN AS MOST SUITABLE CONTENT TYPE DURING INTRODUCTORY & GROWTH PHASE Among all the content types, Product videos got the most nods from our respondents for their suitability during the introductory & growth phase of the product lifecycle. Most of the content types scored the highest on suitability for use during the growth phase. Print magazines & Press releases were favoured more in the introductory phase, while Infographics & FAQ documents found equal favour both in the introductory & growth phase. Please map the content types based on their suitability of usage during the various phases of the product lifecycle Introductory Growth Maturity Decline 69% 52% 67% 18% 80% 64% 78% 27% 50% 64% 46% 8% 56% 78% 46% 9% Ebooks In-person events Mobile apps Case studies 67% 84% 64% 36% 22% 69% 55% 19% 71% 80% 57% 14% 59% 80% 40% 13% Research reports Annual reports Articles Digital magazines REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 15

Introductory Growth Maturity Decline 80% 82% 60% 40% 67% 73% 52% 14% 85% 79% 62% 24% 56% 59% 46% 23% Blogs White papers Product videos Print magazines 57% 89% 33% 11% 70% 89% 33% 11% 75% 76% 64% 11% 80% 82% 61% 14% Newsletters Mobile content Webinars/ Webcasts Infographics 80% 44% 31% 7% 46% 85% 49% 29% 75% 82% 39% 5% 49% 68% 57% 39% Social media Podcasts Data sheets Product manuals/ Catalogues 68% 78% 28% 24% 83% 82% 27% 18% 76% 76% 67% 11% FAQ documents Presentations Press releases REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 16

The top 5 content types in each phase of the product lifecycle INTRODUCTORY Product videos Presentations In-person events Blogs Infographics 70% 68% 64% 63% 63% GROWTH Product videos Presentations Social media In-person events Case studies 73% 70% 70% 66% 66% MATURITY Case studies Presentations White papers In-person events Blogs 63% 59% 55% 54% 50% DECLINE Data sheets Presentations Case studies Product manuals FAQ documents 29% 25% 21% 21% 21% REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 17

NEW CUSTOMER ACQUISITION MOST WIDELY USED METRIC TO MEASURE IMPACT OF PRODUCT MARKETING 89 percent of respondents mentioned New customer acquisition as the metric they used to measure the impact of product marketing. Increase in ROI was ranked second at 62%. In your opinion, which metrics are primarily used for measuring the impact of product marketing? New customer acquisition 89% Increase in ROI 62% Subscribers growth 50% Visitors growth 46% Social media virality 21% Reduction in costs 8% REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 18

REVENUE & LEADS DETERMINE THE SUCCESS OF A PRODUCT LAUNCH With increasing pressure on sales, more and more marketers are defining revenue generation as their top priority marketing objective (Source: State of B2B Marketing 2015). Revenue generated (70%), Number of leads generated (67%) & Pipeline created (67%) overshadowed all other metrics in defining the success of a product launch. It was heartening to see as much as 53% of respondents mention Tracking and analysing marketing metrics as an important measure of success. This is in the right direction, keeping in mind our earlier study on the State of B2B Marketing Metrics & Analytics 2015, where 86% of the marketers we spoke to said marketing analytics was very important for the success of their marketing program. REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 19

How do you measure the success of a product launch? Revenue generated Number of leads generated 70% 67% Pipeline created/ influenced 67% Tracking and analyzing marketing metrics Warm leads and new customers Marketing ROI 42% 53% 51% Customer/ User engagement 42% Page views/ clicks/ shares/ likes/ re-tweets 32% Online marketing analytics 30% Feedback collection 19% Customer retention plan 18% Ad or call campaign analytics 16% Sentiment analysis 16% REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 20

MARKETING AUTOMATION TOOLS ARE CHANGING LEAD CONVERSION TECHNIQUES SAY MARKETERS Strong dependence on marketing automation tools are changing the way lead conversions are being managed today, said 59% of our respondents. Pre-purchase demo expectation & slow conversion due to prolonged customer consideration phase were the second most cited change to be noticed in lead conversion techniques. What changes have you noticed in the contemporary lead conversion techniques? Strong dependence on marketing automation tools 59% Pre-purchase demo expectation 46% Slow conversion due to prolonged customer consideration phase 46% Personal and long lasting relation 30% Insightful comparative feature walkthrough More preference for dialogue marketing Abundance of market-sales synchronising tools Quick conversion of qualified/ hot leads 25% 25% 23% 20% REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 21

DIFFICULTY IN MEASURING ROI & GENERATING QUALIFIED LEADS ARE THE MOST PREVALENT CHALLENGES FACED BY MARKETERS When we asked our respondents what their key product marketing challenges were, 49% of respondents mentioned difficulty in measurement of ROI, while 44% chose customer awareness and qualified lead generation. Measuring ROI continues to trouble marketers. This is an area where we see potential for analytical companies to make a contribution. REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 22

Which of the following digital channels does your organization tap into for marketing its product? Difficulty in measurement of ROI Customer awareness and qualified lead generation Lack of budget Effective demos Developing a distinctive brand identity Lack of integration tools to generate/track leads Lack of skilled resource Lack of prospect knowledge Technological changes Competitive yet profitable pricing strategy Finding the right product market fit Customer s demand for Minimum Viable Product at the earliest Creating package that is both informative and visually appealing Product lifecycle phase transitions Multi-Channel conflicts Pragmatic decision driven customers Understanding of Feature Fatigue and Enrichment Rising media cost Identifying and leveraging viable distribution networks Others 49% 44% 35% 27% 26% 24% 24% 24% 20% 20% 18% 15% 15% 13% 11% 7% 7% 6% 6% 6% Certification/Regulations from regulatory bodies 2% REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 23

48 PERCENT OF RESPONDENTS SAY THEY HAVE 1 OR 2 MAJOR PRODUCT LAUNCHES EVERY YEAR; AND 42% SAY THEIR GO-TO-MARKET PLAN LASTS BETWEEN 2 & 3 MONTHS How many major product launches do you have every year? 1-2 48% 3-5 31% 6-10 Above 10 6% 14% How long does your go-to-market plan approximately last for a product launch? 1 month 6% 2-3 months 42% 4-6 months 6-12 months More than a year 8% 17% 27% REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 24

75 PERCENT OF COMPANIES WE SPOKE TO ALLOCATE UP TO 25% OF THEIR MARKETING BUDGET TOWARDS PRODUCT MARKETING What percentage of your marketing budget is currently allocated toward product marketing? Less than 10% 10-25% 35% 40% 25-50% 22% More than 50% 4% REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 25

OUTBOUND MARKETING RECEIVES A LARGER SHARE OF THE PRODUCT MARKETING PIE What percentage of your product marketing budget is currently allocated towards outbound marketing? Less than 10% 24% 10-25% 25-50% 28% 41% More than 50% 8% What percentage of your product marketing budget is currently allocated towards inbound marketing? Less than 10% 45% 10-25% 25-50% 26% 28% More than 50% 2% REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 26

What percentage of your product marketing budget is currently allocated towards digital marketing? Less than 10% 10-25% 38% 34% 25-50% 18% More than 50% 10% What percentage of your product marketing budget is currently allocated towards traditional marketing? Less than 10% 10-25% 43% 39% 25-50% 14% More than 50% 4% REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 27

MAJORITY OF MARKETERS SEE THEIR PRODUCT MARKETING BUDGET EITHER INCREASE OR REMAIN THE SAME IN THE NEXT 12 MONTHS How do you see your product marketing budget change over the next 12 months? Increase 47% 13% Decrease Remains the same 40% REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 28

FINAL THOUGHTS Product marketing has changed dramatically in the digital age. We have tools and technologies today that enable us to launch products faster, target them better and track their adoption more closely. It is heartening to see a significant majority of the companies in our survey willingly investing in product marketing. We are also seeing an increased awareness amongst B2B marketers of the importance of automation tools for creating a more efficient delivery system In terms of marketing channels, most of the traditionally popular digital channels continue to dominate. This is an area that could see some innovations soon. Video as a content type is being consumed more and B2B marketers will do well to take note of this. The only area that worries us is the overarching importance being placed by companies on revenue generation and customer acquisition in product launches. Such a unidimensional approach to new product strategy can stifle innovation; and ignore, in the process, other important aspects of marketing like consumer engagement. This is an area where B2B marketers can learn a lesson or two from their counterparts in the B2C space. REGALIX RESEARCH STATE OF B2B PRODUCT MARKETING 2015 / 29

ABOUT THE ANALYSTS Nimish Vohra SVP, Principal Analyst Nimish, Senior Vice President, works with CMOs and senior marketing professionals. His research focuses on customer experience management, predictive analytics, mobile enablement and other emerging trends that help customers leverage technology as an enabler of marketing and business outcomes. Ravish Kamath Senior Director, Products Ravish Kamath has over a decade of experience in bringing products and ideas to life. At Regalix, Ravish is responsible for driving the overall product strategy and its execution. He is passionate about prototyping, evangelizing new technologies, building and mentoring teams and of course launching new products.

ABOUT REGALIX RESEARCH Headquartered in Silicon Valley, we help the CMO organization leverage emerging digital practices for creating marketing leverage as they bring new products and innovation to market. Regalix Research helps marketers through research-based insights, consulting and peer-to-peer programs that guide marketing strategy development and execution. Our focus is helping Technology companies leverage innovation and best practices to create real differentiation. Our analysts are practitioners with a successful track record of delivering real marketing results for both leading Fortune 500 companies as well as venture backed firms. Regalix is an award-winning Global Innovation company that leverages technology and marketing to help companies grow. We create successful ventures with our clients through co-innovation and idea-driven frameworks that inspire companies to think different. We bring ideas to life by envisioning new companies, developing brands, engineering products, and designing technology platforms. Founded in 1998, Regalix is based in Palo Alto. Our Silicon Valley setting has enabled us to stay ahead of emerging trends in digital technology and marketing. For over a decade, we have provided complete marketing services Social, Mobile, Content, Multi-channel Campaigns, Technology Development, and Analytics to companies such as CA Technologies, Citi, Apple, ebay, Cisco, VMWare, NetApp, Cypress, LSI, Keynote, and MetricStream. For more information To find out how Regalix can help you, please contact our office, or visit us at www.regalix.com Regalix Research 1121 San Antonio Road, Suite #B200 Palo Alto, CA 94303 (US): 1-888-683-4875 (India): +91 80-49445010 Email: research@regalix-inc.com