Extensive research on effective advertising strategies has almost exclusively focused on B2C companies; this has left B2B marketers without any data-driven guidelines to help create strong campaigns.
LinkedIn, in collaboration with renowned researchers Les Binet and Peter Field, have produced a really useful report ‘Brand and Demand: The Key Principles of Marketing Growth’ which includes research from 3,702 B2B marketers across 9 industries to find formulas for effective B2B campaign strategies for growth.
In this summary, we identify the key takeaways for you to implement in your daily marketing practices.
Brand v Demand Generation
In the marketing world, the ongoing debate between brand and demand generation strategies has long persisted. Traditionally, these have been mutually exclusive; marketers often opt for either one at different stages of their growth strategies. Brand marketing focuses on establishing lasting connections between the brand and relevant buying situations. It employs strategies like thought leadership and corporate social responsibility to build foundations for steady, long-term growth. On the other hand, demand marketing is geared towards creating a sense of urgency around specific products/services to drive short-term sales. Understandably, marketers tend to choose the latter. Demand marketing has the ability to show immediate impact, whereas the inability to see these results instantly is the #1 barrier to brand building..
However, research suggests that it’s time for change as brand marketing offers several incentives to benefit your organisation. It’s proven that a strong brand can command premium prices as buyers will pay more for well-known, established brands. Also, a focused acquisition strategy has been proven to increase conversion rates and lower costs. Alongside this, improved fiscal health arises as organisations that invest 50% of their budgets into brand strategy see better financial performance. Evidently, there are clear reasons to adopt brand marketing tools, and B2B marketing trends suggest tides are beginning to change. In fact, 6 in 10 B2B marketing leaders say their C-suite has increased the importance of brand building. In the same report, the CMO of Financial Services states that “although the focus is on lead generation, brand building will be an important next step for us as a group.”
With the importance of brand marketing increasing, there is a need to research its effectiveness. LinkedIn, teaming up with Benit and Field, has found that the 5 key principles of marketing growth are dependent upon striking a balance between brand and demand marketing in B2B sectors. We know you’re here for the details, so here’s how marketers should approach these principles in their strategies:
When beginning a marketing campaign, we must consider who we are targeting. Whilst focusing on existing customers seems plausible, this demand-based approach will stunt growth when exercised in isolation. Ultimately, customers can only spend so much and churn is a natural process mostly out of your control. Thus, marketers must consider both customers and non-customers; targeting these together drives a quicker and more insulated growth strategy. This means breaking into new budgets that focus on customer acquisition whilst nurturing your existing consumers. Despite this, a whopping 65% of marketers believe that businesses grow best when increasing customer loyalty. Therefore, an opportunity lies for marketers to invest brand efforts in acquiring new customers in addition to growing existing accounts.
PRINCIPLE 1: Sustain growth by leveraging both acquisition and customer growth strategies
The marketing purchasing funnel is a model that represents the stages a potential customer goes through when making a purchasing decision. Along this customer journey, marketers must ensure their brand has awareness throughout each stage to drive conversions. According to this research, brands primarily need fame to be on top of minds at every point along the funnel. But what is fame in this context? It is “awareness at scale” – when everyone in the market knows your brand and buys it effortlessly in various situations. Implementing strategies that improve mental availability, the likelihood that your brand is at the forefront of consumer minds is therefore highly effective in both B2C and B2B campaigns; the more famous the company becomes, the better the business results. This is reinforced by the fact that people often rely on mental shortcuts called heuristics rather than logic when making decisions. In fact, psychologist Daniel Kahneman calls the brain “a machine for jumping to conclusions”. Even in B2B settings where rationality is common, data suggests mental availability remains king. Despite this, 75% of B2B marketers run their brand campaigns for 6 months or less. While this creates temporary demand, awareness will ultimately decline as customers draw their attention to the next new thing. Therefore, it is critical for B2B companies to run brand strategies that focus on consistency, reach and duration to effectively increase and maintain brand fame and mental availability. When you are on consumer minds, business will inevitably grow alongside it.
PRINCIPLE 2: Strive for ad consistency, reach, and duration in order to achieve fame.
A persistent question arising from marketing efforts is whether running campaigns should be for short-term effectiveness or long-term growth. Whether your organisation is B2C or B2B, investment in both options is critical for growth. According to these studies, optimal efficiency for B2B organisations appears when 46% of the budget is allocated to a brand (with around 54% allocated to activation). By striking this balance, this hybrid approach will likely drive business growth. Another problem for marketers when determining the longevity of their campaigns is when to measure ROI of their investments. However, although the average sales cycle is 6 months, data shows that an incredible 96% of marketers are measuring ROI investment in just 3. This trend indicates a clear flaw in many B2B campaigns, marketers must take a breath and slow down. Measuring ROI over the full length of their sales cycle, rather than just half, will most accurately capture investment impact. This allows for increased clarity in campaign effectiveness and accurate, data-driven decisions over budget allocation.
PRINCIPLE 3: Invest in shorter-term demand generation efforts and longer-term brand campaigns to drive growth.
One of the key decisions marketers face is whether to target their campaigns broadly or narrowly. Whilst narrow targeting may seem attractive as it allows for a more personalised approach, it has its limitations. By focusing on specific niches, B2B marketers ignore key buying circles (decision-making units within organisations that participate in purchasing) and future customers. With 44% of working professionals changing jobs, companies, or industries at least every 4 years, B2B companies must remain adaptable and increase their customer pool to keep a competitive advantage. Surprisingly, despite these problems, 69% of marketers still opt for hyper-targeting over exploring broad approaches. Yet, brands that maintain a larger “share of voice” relative to their market share are likely to experience growth; B2B marketing efforts must focus on increasing visibility and presence by targeting broader audiences to reach new buying circles and identify critical influencers within them to drive sales. After all, there are 6.8 people typically involved in each B2B purchase decision. To capitalise on this figure, marketers must consider expanding their reach beyond existing decision-makers to create opportunities for business growth. In this rapidly changing environment, keeping all options open ensures longevity and success.
PRINCIPLE 4: Grow by reaching more customers than you currently have.
Consumers make emotional and rational purchasing decisions; marketing efforts should therefore follow suit. While rational advertisements tend to be more effective for in-market customers who’ll buy now, emotional campaigns are optimal for out-of-market customers who’ll buy later. Despite this seemingly clear binary, B2B marketers are, regardless of objective, 2x more likely to produce rational advertisements. This not only ignores the importance of having a goal-driven strategy but also means there is no balance between demand and brand marketing efforts. Thus, there’s a chance for B2B organisations to bridge this gap and produce more emotionally focused creative projects (particularly for upper funnel efforts). This opportunity is clearly relevant and can still be explored in today’s market, with 46% more creative skills added to marketers’ profiles from 2021-22. Creative talent is in no short supply, and B2B companies taking advantage of the shift can reach more out-of-market customers and build effectively.
PRINCIPLE 5: Balance the usage of rational and emotional ads to strategically build growth over time.
With rapid innovations and a constantly changing landscape, being a marketer is never easy. However, using this research into B2B companies, we can follow a rough guideline that successfully balances brand and demand marketing using these 5 key principles. Striking this balance is undoubtedly tough, but ultimately achievable. By implementing a strategy that incorporates customer growth and acquisition, consistent advertisements, short and long-term growth methods, broad targeting, and emotionally driven creative campaigns, B2B companies can drive growth and ensure future success.
Whether it be carousel ads that showcase product offerings or engagement retargeting to resurface relevant resources to the right customers, customer acquisition is made simply through LinkedIn’s various tools.
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