Vivek Madan, partner at OC&C Strategy Consultants, explains how to decide then defend your marketing budget
Brand building is becoming ever more important in the B2B sector, as competition becomes fiercer and growth harder to come by in maturing markets.
B2B vendors are increasingly looking for ways to differentiate themselves from a crowded pack. Defining a brand position is a great way to do this, as well as helping to provide focus within the business and deciding what capabilities to develop.
Although the UK economy is beginning to recover, growth is still slow within the service sector – and as a result, marketing budgets are still under pressure. More than ever before, CMOs have to make a strong case to decide and defend their marketing budgets, by showing how their brand strategy can have an impact on the bottom line and by clearly evidencing return on investment.
With this in mind, there are a number of crucial areas marketers should consider when setting out their brand strategy, in order to show how it will impact the business:
1. Identify where your brand is and where you want it to go
Some B2B providers have made the mistake of adopting the old-school B2B mentality of ‘saying what people want to hear in order to get a sale’.
Nowadays, the brand strategy should be viewed as a unifying theme within the business and a core hook for the business strategy, driving a virtuous circle of awareness, customer acquisition and retention.
Marketers need to define their brand’s current position – including who their target customer sets are, what propositions resonate with these, and why and how providers are different. By understanding where the brand is now versus the business vision in the short, medium and long-term, marketers will be able clearly show progress made and quantify outputs.
As such, the CMO must be woven into the fabric of the organisation and report directly into the CEO.
2. Identify your audience
B2B audiences are more complex than B2C audiences, with a myriad stakeholders. For this reason, many B2B providers still struggle to build a coherent brand strategy targeting all the players in their ‘ecosystem’ – including buyers, users, stakeholders, shareholders and influencers.
Users are often overlooked, as some B2B providers don’t feel comfortable engaging or tailoring propositions for the end-user, despite operating in an increasingly consumer-facing market .
Marketers need to examine the different audiences they’re trying to reach and weight resources against their respective importance to achieve the most efficient marketing mix possible – whilst avoiding the pitfall of developing a piecemeal marketing strategy for each audience.
3. Define the aims of your brand strategy and how important your brand’s image is to drive your competitive positioning
In the past, B2B companies have made the mistake of thinking that brand building is a vanity exercise – with some providers viewing marketing spend as a ‘hygiene’ cost that should be absorbed to get their name into the market.
Given the increasing importance of creating a prominent brand for B2B audiences, we have started to see a step-change. This has been driven in part by changes in procurement processes, where formal tenders are being influenced by a more fragmented and digital buying community. As such, B2B brands need to ensure every stakeholder touchpoint has an integrated and consistent demonstration of the brand.
4. Execute your strategy brilliantly
Historically brand and service delivery for B2B providers were more discrete in the eyes of buyers. A strong brand got providers onto the RFP and great service delivery kept firms in business. However, as digital communications increase transparency, we are increasingly seeing operational delivery being fundamentally linked to brand.
5. Quantify return on investment
It is increasingly important to ensure that the benefit of brand building activities can be quantified as a mandate to demand future budgets. This is an area where, historically, B2B providers have significantly lagged behind their B2C counterparts
There are several techniques which can be employed to quantify return on investment on marketing spend to help to defend marketing budgets from year to year. These will differ depending on the brand, but examples include tracking brand equity through referrals, looking at share and tone of voice on social media or reviewing the number of bid lists selected for.
Although this is not an exact science, data collation, review and marketing strategy optimisation can be more systematically implemented into the current processes of the marketing function within most B2B firms.
