Performance Marketing’s Limitations: What You Need To Know
Forrester
B2B buyers are increasingly empowered, informed, and decisive, and they have clear preconceptions about the vendors they prefer.
41% of buyers report having a single vendor in mind when they first begin the purchase process, and a staggering 92% had a shortlist, according to Forrester data. This means that when B2B buyers decide to buy, two out of five already have a favorite in the race, and nine out of 10 have formed their list of preferred options. As a result, the buyer’s journey becomes much more a process of confirmation rather than selection.
Why “Performance Marketing” Isn’t Enough
In an effort to focus on active buyers, many B2B organizations over rotate toward marketing tactics that engage buyers long after they have formed preferences.
B2B marketing and sales teams that rely on these short-term tactics to attract active, in-market buying group members are drastically limiting their reach and effectiveness. Instead, B2B marketers need to expand their assumptions about the buyers’ journey. They must recognize that, by the beginning of the journey (i.e., the discovery phase), buying groups have already formed clear preferences and informal shortlists. Faced with this reality, marketing’s goal must be to influence these decisive buyers before they enter a formal purchase process, requiring committed, long-term investment to position the brand so that it is placed on the shortlist.
This is a radical departure for many B2B companies that have built so-called “performance marketing” teams focusing almost exclusively on in-market buying groups that display intent. Marketers must rebalance resources from “performance marketing” and toward more proactive “preference marketing.” They must marry brand and demand marketing efforts and build sales and marketing playbooks based on preference positioning.
Build Preference Marketing
B2B marketing teams still need to find a balance between the near-term imperative of engaging with active buying group members and the longer-range goal of building preference in a market or segment so that it’s not one or the other. What’s clear is that marketing teams creating campaigns and programs that build preference will drive more sustainable long-term growth and higher levels of marketing effectiveness and ROI than those that focus on “performance marketing” alone.
By making the building of brand preference a priority, you will help ensure that your organization is on the shortlist when buying groups begin their formal purchasing process, ideally as their preferred vendor of choice. Utilize market research, brand trackers, and other methods to monitor buyer sentiment and preference across your most relevant markets and product categories. This data, along with other preference metrics, will also show how building buyer preference drives a step-change improvement in downstream demand metrics, such as pipeline growth, win rates, and market share.
The bottom line: Once buying groups enter their formal buying process and show a clear intent to purchase, they already have preconceived ideas about which vendors they favor and which they don’t. Your company will be too late to exercise significant influence on these decisive buyers and will likely end up as “cannon fodder” for pricing negotiations against the preferred vendors. That’s not a good place to be.
This post was written by VP, Principal Analyst, Ian Bruce and Principal Analyst, John Buten. The original blog featured here.
