What gnarly farmers can teach us about marketing strategy
Peter Morgan explains why B2B marketers need to move slower and think harder about the long-term implications of decisions.
Agriculture is the oldest industry. It can teach us some stark lessons on strategy. Take the example of a farmer and his tools. Every time a new tool has appeared – say the hoe, or the plough, or the tractor – the farmer has been faced with a decision on whether to invest.
To find the answer, each farmer weighs the likely benefits against the costs. If the farmer invests in a new tool, what is the gain? What is the cost? What other investments need to be forgone, and what are the opportunity costs of each decision?
The farmer only invests where all the benefits outweigh all the costs. If there isn’t clear value, there's no investment.
So what can smart marketers learn from gnarly farmers?
Marketers should approach investments in new strategies with the same rigor, but most don’t take a rounded perspective.
Modern marketers are bombarded with new tools and techniques on a daily basis. But it's critical that any investment in time or money is guided by cost-benefit analysis. If you make investments based on a tool or technique providing just ‘any’ benefit, you risk wasting money, damaging customer relationships, and impacting the bottom line.
Take remarketing through web display advertising. At face value, it seems logical; serve ads to people who have visited your website, lure them into repeat visits, add a new stream of traffic, and incremental revenue that you can measure.
But how have you measured the costs?
Research by Smart Insights shows that average click-through rates for display remarketing are 0.05%. For every 10,000 times your ad is shown, you’ll generate – on average – five clicks.
With modern analytics technology, it’s easy to demonstrate the impact these five clicks might have on revenue. But what about the 9,995 impressions that don’t generate a click? How many of these impressions are noticed? How many react positively? How many react negatively?
We’ve all been chased around the internet by banner ads which are served out of context. How did you respond to that experience? You can’t measure this kind of negativity through analytics tools, but that doesn’t make the impact any less real.
Now consider the complexity and value of a typical B2B sale. Any salesperson will tell you, building and maintaining an emotional connection with your customer is critical to the sale. Is it worth risking 9,995 relationships – and your brand’s legitimate right to engage relevant decision makers – for those five clicks?
B2B relationships are simply too valuable to throw away
Marketers need to take back control of their strategies, focusing investments on a core set of tools and techniques that generate value, while respecting customers and the principles on which their brand is built.
In the context of our display advertising example, B2B marketers must take responsibility for where their ads are placed. This means ditching tools that annoy potential customers, instead focusing investments on a core group of domains where those customers are actively consuming relevant, business content.
Such an approach is key to building – and maintaining – trust, and to generating sustainable, long term value through your marketing investments.
Autumn 2017's edition of the B2B Marketing magazine features three stellar examples of paid social media marketing, the ins and outs of GDPR and what this means for B2B, and two marketers going head-to-head on whether content marketing is actually a thing.