Sunday, May 25, 2014

Where Marketing and Sales Agree and Disagree

Virtually all B2B marketing thought leaders and practitioners agree that successful demand generation now requires a close alignment between marketing and sales. I've gone a step further and argued that B2B companies with complex and lengthy selling cycles should consider integrating marketing and sales to create a unified demand generation function.

Whether your objective is alignment or full-blown integration, the starting point is to understand how your marketers and salespeople currently view their roles in the demand generation process and what each group believes should be done to improve demand generation performance.

A 2013 survey by Sales & Marketing Management magazine and Corporate Visions provides valuable insights on both of these important issues. The SMM survey included almost 200 participants drawn from 15 industries. Both marketers and salespeople were asked the same questions, and the responses were segmented to illuminate where the two groups agree and disagree.

We have a tendency, I think, to believe that a vast chasm exists between marketing and sales and that the two functions operate in different worlds. While that's undoubtedly true in some organizations, my takeaway from the SMM survey is that marketers and salespeople have similar views on several important demand generation issues.

One area that shows both agreement and disagreement is the role of marketing in revenue generation. The SMM survey asked participants:  How does marketing drive revenue? The table below shows how marketers and salespeople ranked five marketing strategies or activities in order of importance.

The most striking disagreement on this issue relates to sales enablement. Salespeople ranked sales enablement as the second most important marketing activity for driving revenue, while marketers ranked it dead last. Part of this disagreement can be attributed to the fact that sales enablement is still a relatively new discipline for many marketers. Also, in many companies, sales enablement content and tools are still developed in the sales or sales operations department, rather than in marketing.

An issue on which there is significant agreement between marketing and sales relates to what factors cause prospects to do business with a company. The SMM survey asked participants to select the factor (from four possible choices) that describes why prospects choose to do business with their company. The table below shows how marketers and salespeople responded.

Building a tighter relationship between marketing and sales begins by understanding where and how much your marketers and salespeople agree and disagree on important demand generation issues. The SMM survey provides valuable insights on this important issue, and you can learn more about the survey results at the Corporate Visions website.

One tool that can be very useful for uncovering agreements and disagreements between marketing and sales is an importance-performance matrix, which I described in this earlier post.

Sunday, May 18, 2014

Why B2B Marketers Should Care About "Couch Tracking"

In their new book, Absolute Value:  What Really Influences Customers in the Age of (Nearly) Perfect Information, Itamar Simonson and Emanuel Rosen contend that several long-standing and widely-accepted principles of marketing are becoming less relevant in today's competitive environment. For example:

  • Brand names and brand perceptions are becoming less powerful, and they are playing a reduced role in the customer decision-making process.
  • Customer loyalty is declining. A customer's past experiences with a brand are having less and less impact on the customer's future buying decisions.
  • Product positioning is less effective than it used to be, and marketers' attempts to shape people's preferences with traditional "persuasive" marketing techniques are becoming pointless in many markets.
Simonson and Rosen argue that an abundance of high-quality information about products and services is driving a fundamental shift in how consumers make buying decisions. When potential buyers can easily access credible information (such as expert opinions, customer reviews, and price comparison sites), they rely less on general brand perceptions and their past experiences with a brand's products and services, and they are less influenced by traditional marketing techniques and messages.

This wealth of "objective" information makes it easier for potential buyers to judge the absolute value of products or services and make more "rational" buying decisions.

For obvious reasons, Absolute Value has created quite a stir in the marketing community. I'll provide my view on the brand, loyalty, and positioning topics in future posts. In this post, I want to discuss another concept in the book that has significant implications for B2B marketers.

Simonson and Rosen identified three "new" consumer decision-making patterns that are assuming greater importance in today's information-rich environment. They called one of these patterns couch tracking. The basic idea of couch tracking is that because information is now so easily accessible, potential buyers are constantly consuming information about products or product categories that interest them.

In the book, Simonson and Rosen used couch tracking to describe the behavior of consumers, but the idea also applies to business buyers. In B2B, couch tracking means that business buyers are "always" accessing information about business issues and products or services that attract their interest.

The problem is, this consumption of information does not necessarily mean that the potential buyers are actively considering a potential purchase, but it's easy to misread the signals. Most of the traditional models of the B2B buying process focus on what happens after a potential buyer becomes aware of a need or a business issue that should be addressed. In the traditional models, this awareness triggers an active buying process that usually starts with information gathering.

Simonson and Rosen contend that couch tracking can turn the traditional buying process on its head because potential buyers are gathering and consuming information long before they are ready to seriously consider buying something.

Couch tracking has several important implications for the practice of B2B demand generation. Most importantly, it elevates the importance of developing and publishing high-quality marketing content. Couch trackers will form a powerful first impression of a company based on the content they consume, even when they aren't actually considering a purchase and have no immediate plans to begin a buying process. The important point is, if and when a potential buyer begins an active buying process, that first impression plays an important role in determining which potential vendors are given serious consideration.

Compelling, high-quality content has the potential to create what psychologists call a halo effect. A halo effect can be defined as a cognitive bias in which we "transfer" our perceptions regarding one quality of a person or an organization to other qualities or attributes of that person or organization. In other words, if we perceive that a company is good at "A," we will tend to perceive that the company is also good at "B" and "C."

A halo effect significantly increases the "weight" we give to first impressions. Therefore, if a potential buyer is favorably impressed by the content you publish, he or she will transfer that favorable impression to other attributes of your company and your products or services, even before he or she has "hard" evidence to support a judgement.

The potential for creating halo effects with couch trackers is just one more reason why compelling content is so critical to effective B2B demand generation.

Sunday, May 11, 2014

What Marketers Can Learn From the Gartner Hype Cycle

Academic researchers and business analysts have been studying the adoption of new technology for at least the past fifty years. One of the most well-respected models of technology adoption is the diffusion of innovations theory that was developed by Everett Rogers in the early 1960's. Rogers' model is the source of the now-familiar terms early adopters, early majority, late majority, and laggards.

In the mid-1990's, the analyst firm Gartner, Inc. developed another model to describe the adoption of new technologies. Gartner called their model the hype cycle, and it's become a popular way to depict the technology adoption life cycle. Gartner regularly publishes hype cycles for various categories of technologies, and I find them always interesting and occasionally provocative. The diagram below shows the components of the Gartner hype cycle.

As this diagram illustrates, there are five phases in the Gartner hype cycle.

  • Technology Trigger - when a new technology is launched
  • Peak of Inflated Expectations - when the expectations for a technology (driven by several forms of hype) far exceed what the technology can reasonable deliver
  • Trough of Disillusionment - when the unrealistic expectations aren't met, some users and supporters abandon the new technology entirely
  • Slope of Enlightenment - when the realistic benefits of the new technology begin to appear, and users begin to apply the technology to achieve those benefits
  • Plateau of Productivity - when the realistic benefits of the technology become widely apparent, and there is mainstream adoption in the market
The Gartner hype cycle is designed to provide one perspective of technology adoption, but I suggest that it also applies to other types of innovations, including new marketing strategies and techniques. That's because the hype cycle is really a description of how we as humans respond to new things that promise to change our status quo for the better.

It's easy to see the hype cycle at work in marketing. When a new marketing strategy or technique appears that seems to promise significant benefits, the marketing community often responds with great excitement. The "shiny new object" becomes the topic du jour for articles, blog posts, webinars, conference sessions, and even full-length books. As the hype machine kicks in, it becomes almost impossible not to overestimate the benefits that the new strategy or technique will provide. Almost as important, the hype inevitably overstates how easy it is to realize those benefits.

Enticed by the exaggerated benefits, we rush to acquire and/or implement the new strategy or technique only to find that it doesn't deliver the benefits we expected. After a while, we may even decide that our shiny new object is essentially worthless and abandon it entirely.

If we get past this point, we may begin to develop a more realistic set of expectations regarding the benefits that the strategy or technique can deliver and, just as important, a better understanding of what we must do in order to realize those benefits. Finally, as we become increasingly proficient with the strategy or technique, it becomes increasingly productive, and we begin to gain the (realistic) benefits we came to expect.

So, what can marketers learn from the Gartner hype cycle? First, be careful not to overestimate the benefits that a new marketing strategy or technique will provide. There are simply no silver bullets in the practice of marketing. As a human being, you probably won't be able to completely avoid inflated expectations, but make your best efforts to resist the hype.

Second, when a new strategy or technique fails to meet your initial expectations, don't be too quick to declare it a complete failure. Recognize that your initial expectations were probably exaggerated, and make an objective evaluation of what benefits you can reasonably expect the strategy or technique to provide. This is also when you need to develop a clear and accurate picture of what you will need to do to reap those benefits.

Some marketing strategies and techniques are nothing more than fads, and they should be dropped at the earliest opportunity. In most cases, however, the initial disappointment results from unrealistic expectations regarding both the significance of the benefits and the work you'll need to do to realize them.

Sunday, May 4, 2014

One Way to Make Feeding the Content Beast Easier

Other than lack of time, the biggest challenge now facing B2B content marketers is producing enough content, according to the latest content marketing survey by the Content Marketing Institute and MarketingProfs.

The volume of content required for effective B2B marketing has increased dramatically over the past few years in part because publishing new content frequently is important for improving search engine rankings. More significantly, though, companies must produce more content because of the need to make marketing messages more relevant for potential buyers. To improve relevance, marketers are increasingly using two best practices:
  • They are creating buyer personas and developing content that is tailored to address the particular needs and interests of each persona. This increases what I call personal relevance.
  • They are developing content that is specifically designed for each stage of the buying process, which increases what I call situational relevance.
This approach can be extremely powerful and effective, but it can also turn content development into an overwhelming job for many companies. For example, suppose that you've created four buyer personas and that you use the traditional four-stage buying process (Awareness-Interest-Consideration-Decision). This scenario would literally require 16 unique content assets to fully implement a persona-specific/stage-specific content marketing strategy, as illustrated by the following table.

While there is no "easy" button for content development, there are some steps you can take to make the job more manageable. One important step is to ask how much customization is really required to achieve the necessary level of relevance.

For example, the reality is that you probably would not need 16 distinct content assets to have an effective marketing program in the circumstances described above. If you take a close look at your buyer personas, you would probably find that they have similar interests, concerns, and information needs when they are in the early stages of the buying process. In many cases, the need for content that is customized for each buyer persona increases as potential buyers move through the buying process.

What this means is that you can often use one early-stage content asset to "cover" multiple buyer personas without incurring a significant loss of relevance. The table below shows how this approach could be used to reduce the number of assets needed for an effective content marketing program. In this example, the number of required assets goes from 16 to 11, which represents a 31% reduction in the number of assets needed.

The above example is for illustration purposes only. There's no universal rule that predicts how much streamlining this approach will enable you to achieve. Your business circumstances will dictate how much streamlining is possible, and you should only streamline if you can maintain a high level of relevance. But, if you can lower your content requirements by even 20% or so, that will make feeding the content beast easier.