Optimizing B2B online marketing ROI requires a clear target audience, strategy, engaging creative, solid execution and accurate metrics....
Optimizing B2B online marketing ROI requires many things - a well-defined target audience, clear strategy and tactics for targeting business buyers online, engaging creative, solid execution and accurate performance metrics to name the major ones. By checking each of these off, however, have you truly optimized your B2B online marketing performance?
Based on my 12+ years connecting business buyers and advertisers online across client, agency and publisher roles, the answer is a resounding "NO". The best most B2B companies achieve with their online marketing programs is average performance through a favorite tactic and/or advertising partner, a situation reflected in statements like:
- "We tried banner ads on a couple sites, but the click-through rate was terrible so we stopped them"
- "We dropped paid search everywhere except Google because Google Analytics showed us that was where all our sales came from"
- "Email marketing is the only thing that works for us"
- "SEO is free so we focus on that over paid search"
And yet, as any casual reader of MarketingProfs, MarketingSherpa, Search Engine Watch, Search Engine Land or other great online marketing resources can tell you, there's an abundance of phenomenal success stories describing the exact opposite of the statements above. Why the difference? How can these tactics or advertising partners perform so well for some and so poorly for others? There are four main traps which keep B2B marketers from truly optimizing online marketing performance.
Trap #1: Viewing Business Buying as an Event, not a Process
Ask any B2B marketer to describe business buying and they'll give a reasonably consistent description of a process involving multiple people across multiple stages over time, similar to the following:
The latest Enquiro research about business buying and the Internet suggests that while 50% of business spend is simple repeat ordering from existing vendors, the other 50% fits this general process, with buyers researching new vendors for products/services they already purchase from someone today or for completely new "blank slate" purchases.
In addition, as shown in this figure from MarketingSherpa's 2009-10 B2B Marketing Benchmark Guide, B2B marketers report that nearly 70% of business purchases take more than two months to convert from a lead to a sale.
While B2B marketers know intellectually that business buying is process and not a single event, there's a problem - 94% have no insight into how their online marketing programs impact anything other than the last event before a conversion or purchase. This is based on our own study of B2B web analytics market share across more than 27,000 B2B web sites, but is also consistent with research from Microsoft's Atlas Institute which found 93-95% of audience engagements with online advertising get no credit when advertisers review campaign performance.
B2B marketers are trapped by their inability to see how various online marketing campaigns impact different stages of the buying process. They are forced to look through a small window into the very end of the process.
The 94% of B2B online marketers facing this problem fall into one of two camps on this issue. The first doesn't realize the trap exists. They are flabbergasted by the implications when they understand what's really happening. They've always accepted what they see in their web analytics as the truth, or made due with no insight into online campaign performance, without really understanding their view is limited to the very end of the funnel. When confronted with this fact, there is usually a long moment of stunned silence as all the performance and optimization decisions they've made based on faulty data flash through their minds, followed by a statement like "OK, this is a problem" coupled with a long heavy resigned sigh.
The second camp is more experience with the limitations of web analytics. These marketers know their view is limited to the end of the funnel, and have chosen to accept the situation because "that's all there is to work with." They recognize they're trapped and choose to do what they can while dragging the trap around. They should avoid any conclusions about B2B online campaigns or media which primarily address earlier stages in the buying process, but that's difficult to do in practice.
Trap #2: Believing that Business Buyers Seek Optimal Solutions
People aren't rational optimizers with infinite time and resources to find the best answer. Instead, people satisfice across most decisions they make, putting in just enough effort to find a workable solution. This insight about the difference between viewing people as rational optimizers vs. satisficers underlies the latest model of the business buying process developed by Gord Hotchkiss of Enquiro Research based on a study of over 3,000 business buyers co-sponsored by Enquiro, Business.com, Google, Marketo and Demandbase.
The point B2B online marketers need to understand is simple: rather than taking the time to actively seek and rationally balance the pros and cons of your product/service offering versus the competition, business buyers will simply find their own way to a satisfactory solution when gathering information online using whatever information is readily available. Even then, the 50% of business spend which involves a hunt for new vendors/solutions tilts decidedly in favor of existing, approved vendors.
This means that while your company may offer a clearly superior solution, you may lose the sale to an existing vendor as business buyers seek to reduce the time and risks inherent in building a new vendor relationship, working with new people, learning new systems, etc. The trap around believing, explicitly or implicitly, that business buyers seek optimal solutions is commonly evident in the assumptions which work their way into many B2B online marketing plans:
1) Lead count or visitor-to-lead conversion rate are key performance metrics - getting prospects to register for a whitepaper or webinar may be an essential entry point into the B2B lead nurturing process. But the number of leads generated by a given online marketing program or traffic source, and the conversion rate of visitors from that program/source which convert to leads, are relatively unimportant when viewed alone. These metrics are convenient, yes, and the counts are high enough to make most marketers feel they're learning something valuable for performance optimization.
However, what actually matters is lead quality - percentage of leads matching target segments, how well those leads convert to buyers and how much they actually buy. With the risk management characteristics of business buying, and strong preference for existing vendors, the B2B online marketing campaigns or traffic sources associated with the best quality leads may be very different from those that look the best in terms of initial lead count.
2) Business buyers will find the content on your corporate web site to be authoritative and critical to the buying decision - in fact, they may never find your web site and encounter this great content if it isn't directly in their path as they research solutions online. Also, according to MarketingSherpa's B2B Marketing Benchmark Guide, business buyers trust what they find on business news and information web sites much more than what they find on your site.
3) There are 1-2 key online entry points into our web site - recalling trap #1 above, B2B online marketers know the web site a portion of users visited immediately prior to landing on their own web site. However, unless you take the time to actually sit down with prospects at various stages of the buying process and have them show you, on their own computer in their own office, how they find business buying-related information online then you won't have a clue about (a) the full online path and all the sites touched along the way, and (b) why many viable prospects never make it to your site at all. Without this context, it's impossible to make accurate sense of the "flat" web traffic stats provided by comScore, Nielsen, quantcast, Compete or others. More about this below.
Trap #3: Misunderstanding How Business Buyers Use the Internet
In April, 2009, there were approximately 47 million US adults (18+) Internet users involved in the business buying process, according to comScore Plan Metrix. This is approximately 30% of the total US adult population and 46% of all employed US adult Internet users.
47 million people will not all swim in the same direction when they head into an an ocean of billions of business-related web pages, pursuing a huge range of products/services, at different stages in the business buying process and buffeted initially by semi-personalized search results from general search engines when they dive in at the start of each session.
Put this way, statements like "we only advertise on Google because everyone uses Google" are comical, bordering on tragic. As the dominant general search engine and online portal, most people do use Google, and Google PPC and SEO programs are an essential component of most B2B online marketing plans. But business buyers use Google and other general search engines like Yahoo! and Bing interchangeably (the average Internet user uses three different search engines in a given month) and to get somewhere else. 71% of paid search clicks on general search engines are navigational. This "somewhere else" describes a huge range of different types of sites which support the business buying process in one way or another, from niche business publication sites to directories, product comparison sites, virtual events and social networking sites just to name a few.
The performance-harming traps from misunderstanding how business buyers use the Internet during the purchasing process are either (a) focusing B2B online marketing programs too narrowly on just a few major traffic sources, and/or (b) misapplying strategy, tactics and metrics that work for one campaign or traffic source to other, different campaigns and traffic sources. In the first of these, B2B marketers significantly limit their ability to deliver their brand message and offers at key points in the buying process. In the second, they assume that one successful display ad or PPC campaign on one site should be replicated exactly on other sites and perform the same despite significant differences in functionality, audience and audience stage in the buying process between.
Trap #4: If You Have a Hammer, Everything Looks Like a Nail
This important trap bears mentioning, but it's so well known that I decided to put it last. If you're an expert at something, situations where your expertise can be (or you feel should be) applied pop up everywhere. We like those situations, and we become frustrated if our expertise isn't used or is used but results in poor performance. That's just the way our minds work.
However, problems arise when our expert toolkit isn't up to the job at hand. Let's say you're a golfer. If you only practiced putting and then played a round of golf, you'd probably putt reasonably well but would suffer trying to get the ball from the tee to the green. In this situation, how would you respond? Would you say: "I'm sure glad I'm good at putting but to improve my overall score I need understand and practice with my driver and irons as well"? Or would you say: "The only thing that matters in golf is how well you putt because that's closest to the hole - the rest doesn't matter and is a waste of time to even think about"?
Now let's put the same situation in a B2B online marketing context. Let's say you're a Google AdWords pro. If you spend 95% of your time on AdWords campaigns and are asked to improve overall online marketing ROI, how would you respond? Would you say: "I've got AdWords dialed and the end of the funnel covered, but to improve ROI, I need to understand and start display ad campaigns to build awareness and vertical search/directory campaigns to better cover the shortlist phase"? Or would you say: "The only thing that matters in online marketing is Google AdWords because campaigns there convert the best on branded terms - the rest doesn't matter and is a waste of time to even think about"?
What would you say? What would your agency say? Are either or both of you trapped with a hammer in your hand and seeing nails everywhere you look?
Escaping the Traps that Sap B2B Online Marketing Performance
Some B2B companies and marketers are content with low to average performance. Chances are, that's not you if you've read this far. You want to know how to boost performance somewhere between great and utterly astounding. You won't find the key to truly superior performance in the top 5 tips for better PPC performance or top 10 things you need to know about SEO. These are great, don't get me wrong, but they're tactics that almost anyone can learn and apply.
To escape the traps that lock your B2B online marketing program into average performance, you need to do two things: keep your mind open to alternatives and have the flexibility to act on those alternatives.
Keeping an Open Mind
Repeat after me....online marketing is evolving too quickly for me, my team and my agency to possibly keep up with everything. Think about how few true, enduring experts there are within your own industry, and then compare the speed of change in your industry to that of search marketing, social media, viral marketing or other online marketing domains. Most B2B industries are evolving not nearly as quickly as online marketing, and this forces most B2B online marketers to fit squarely into one of the following roles:
- Niche Tactic Experts - the display advertising pro or paid search guru, for example, who focuses on a specific tactical domain, system or advertising partner.
- Big Picture Generalists - have experience with multiple types of online marketing and often driving cross-channel identify-test-integrate-optimize programs (e.g., identify new channels/tactics, test, integrate into existing marketing mix and optimize across the mix).
- Survivors - everyone else who's wading through the constant change and information overload with a focus on just getting things done
To keep an open mind, it's important to understand which of these roles both you and those you consult with fit into today. Accept the strengths and weaknesses of that position. There's nothing inherently good or bad about each of these roles, but each role does have its limitations.
For example, a Niche Tactic Expert with a expertise in Google PPC campaigns can make sure their company has a solid presence on the search engine most people will turn to at the start of the business buying process and for navigation to the company's web site in response to other online or offline marketing campaigns and/or at the end of the buying process. This expertise is critical. However, the effort involved to stay a niche tactical expert means little effort will go into understanding other online marketing channels (e.g., vertical search, directories) or tactics (e.g., banner advertising, social media), and judgments about those other channels/tactics will typically be filtered through the lens of existing expertise. When a display advertising expert speaks about display advertising, you should listen. When they speak about the performance of SEO or social media vs. display advertising, it's time to tune out.
Similarly, someone in a Survivor role with responsibilities across multiple online and offline marketing domains is applying the 80/20 rule to pick what to focus on given available time and resources. That's a critical function as well. But to deliver superior performance, Survivors need to constantly remind themselves to be tactic agnostic and avoid snap, satisficing judgments.
The main point here is that it's impossible to know and keep up with everything in B2B online marketing. Once you accept that, and the strengths and limitations of where you fit today, it is much easier to keep the open mind necessary to identify and capitalize on new online marketing opportunities that can drive superior performance.
Maintaining the Flexibility to Act on Alternatives
While you may be able to keep an open mind about new opportunities in the rapidly evolving world of B2B online marketing, that doesn't necessarily mean you'll be able to act. As with the business buying process, managing risk plays a big part in the choice to explore new paid search channels, ad networks, remnant banner inventory and especially social media.
Managing risk to gain the flexibility to act on alternatives largely boils down to managing resources and expectations. The most experienced and successful B2B online marketers make sure they keep a portion of their budget and time set aside for testing new opportunities. Similarly, they know to manage expectations down - both their own and others - when starting campaigns using new tactics, on new sites or in virtually any new online marketing situation. These experienced marketers may seem like raging pessimists, constantly sandbagging expectations while delivering superior results, but they have enough experience to expect the unexpected with interactive marketing.