B2B covers a broad range of products and services, so to pick some common marketing challenges is no easy task. The challenges can vary hugely depending on whether you are selling a product or a service, but one common characteristic for all types of B2B organizations is that they don’t invest enough in marketing.
Not big budgets, budgets set for impact
Some may argue that B2B companies often have a limited number of organizations that they can sell (or market) to, so they don’t require big budgets. Versus companies that are selling to the masses, it is true B2B marketers don’t require big budgets. However, the argument here is not for creating big budgets, but for allocating budgets that are big enough to allow your organization to “out shout” the competition. To stay in the prospects mind so that, when the time comes to purchase, your firm is high on the list of potential vendors. Ideally, to be looked at as being different and better than the competition, so in any pitch or bid situation, you come from a position of strength.
In categories that have only a handful of customers that may buy from them, the marketing plan and recommended spend is going to look a lot different than for companies that have hundreds or even thousands of prospects.
What is the right amount for a marketing budget?
So how does one decide what the appropriate spending levels are? A common approach is to look at the competition and figure out what they do and how much they spend, and to make sure you invest similar amounts and do more impactful things.Another approach is to put together a detailed marketing plan. If you do not have the right resources internally, outsourcing a plan can be a great way to bring rigor to the process, and to look at the possibilities from a fresh perspective. A good marketing consultant should be able to take your experience and industry knowledge, combine that with information about your market, your prospects and techniques that have worked in similar industries, and provide you with a disciplined plan that will deliver against your objectives. B2B marketers often lack the discipline to do a plan and execute it faithfully, let alone measure the results. No wonder spending levels are low!
The wrong way to go about setting the budget is to either base it on what was spent the year before, (unless that budget was set based on the methods described above) or what you think you can afford. Unlike rent or other expenses that are necessary evils, marketing should be looked at as a “spend to get” approach. If you are strategic, your marketing spending should pay back, sometimes many times the original spend.
Incidentally, the organizations with the fewest prospects can often have marketing budgets that are much bigger than you would think. Marketing budgets that allow for sales to take decision makers on high-end trips, play regular golf games or go out to events on a regular basis. Don’t get caught thinking the playing field is level without getting a full perspective on the decision making process from the customer’s viewpoint.