B2B business: How to game the digital beast
• On-field salesforce and face-to-face interaction have been the bedrock of the go-to-market strategies of B2B companies over the years.
• However research shows that over the years, the rise of online platforms and e-commerce has also impacted customer buying behavior in the B2B realm.
• COVID-19 has accelerated the intensity and role of digital interface in B2B marketing, with most traditional channels of customer engagement in a limbo.
• While the role of human interaction will remain, it could be significantly reduced. Companies need to be cognizant of how digital is driving market dynamics in their sectors, and how they need to adapt.
It’s a common refrain among B2B salespeople that investments in advertising and brand building – online or offline – are more suited to B2C companies. Sure enough, the salesforce has been the bedrock of success for B2B companies. End consumers interact, engage, relate to and get influenced by brands through advertising, but B2B clients primarily engage with salespeople. Over time, a lot of B2C selling is moved online due to the rise of e-commerce. However, corporate buying decisions have typically been more complex (involving multiple decision-makers), practical and personal relationship-driven.
However, the B2B space is not exactly untouched by the rise of the digital era. In most parts of the world and to a lesser extent in India, online has taken over (and continues to expand its influence) in varying degrees. For non-strategic purchase decisions like stationery, computers, mobile handsets, etc, companies are already more comfortable purchasing online.
Research is revealing in this regard – a B2B buyer typically makes 12 online searches before buying, looking for a similar digital experience as a B2C buyer would. Accenture surmised in 2018 that most B2B buyers are already 57% of the way through the buying process before first meeting a sales representative. Google research in 2019 affirms that even when it comes to industrial and manufacturing industries, around 67% of the purchases are influenced by digital. Another research saw 62% of buyers agreeing that they can make a decision based solely on online content.
These statistics certainly point to a broad trend that B2B companies cannot afford to ignore. And the more interesting detail to note is that these are pre-COVID numbers!
Pandemic hurries the inevitable
From a creeping trend that was seeping into our consciousness, digital has suddenly gone mainstream across the B2B landscape post-COVID-19. Stringent restrictions on travel have curbed avenues to reach customers. Events and conferences have been cancelled across the board, further depriving them of invaluable opportunities for client interface, networking and live inputs on market trends. And even when these curbs are lifted, clients are expected to stay wary of physical meetings, at least till the time a vaccine is developed and the scourge of COVID-19 is summarily defeated.
With these developments and the uncertainty over their duration and impact, digital is emerging as just about the only avenue for B2B sales people to engage with their customers and close deals. Online collaboration tools like webinars, video conferencing and virtual event platforms have become the norm now. This raises questions for B2B firms, especially considering that some of the changes in buying behavior may become permanent, thereby accelerating the focus on digital. Dr Venkatesh (Venky) Shankar, Professor of Marketing, May’s Business School, comments:
“Today, almost all B2B businesses have embraced digital communication both within and across firms. First, the proverbial handshake between vendors and clients has disappeared as COVID-19 rampages through the world. Second, Zoom meetings have replaced in-person meetings. Third, salesforces have started using analytics and AI tools much more than before. These shifts will make B2B firms more productive in their marketing and sales efforts.”
However, he also adds a word of caution that the pandemic will hit ‘digital dinosaur’ B2B firms hard.
In the post-pandemic phase, it is undeniable that the role of the physical salesforce will again regain prominence for B2B companies, but expectations to the extent of rebound differ. Kaustav Sen, Partner – Management Consulting, KPMG in India, argues:
“As the world returns to normal, post discovery of a cure and/or vaccine, physical interactions are bound to increase as face-to-face interactions required for brainstorming on an engineering solution or building relationships, connect and trust are absolutely essential.”
On the other hand, he also agrees that aspects like data transparency through remote platforms instead of a physical visit/interaction at the drop of a hat, remote inspections through digital and technology enabled mediums and even information sharing and communication through virtual mediums are here to stay. Dr K. Rajeshwari, Great Lakes Institute of Management, adds:
“Right from cold calling to prospecting to soliciting, online has enabled more effective methods, thanks to the huge customer profile data available on the internet. This saves time for the company and the customer. LinkedIn networking has gone up by 53% in B2B. Face-to-face interactions have moved to video conferencing, webinars, phone, chat bots etc. Many of these will continue as there are cost and time efficiencies setting in through these.”
Experts feel that a lot of buyer decision making is already done before a face-to-face interface with the company salesperson. The role of marketing will now only accelerate. According to Prof DVR Seshadri, Indian School of Business:
“In the past, if you consider relative importance of marketing and sales in a supplier firm in B2B markets, the split was 25:75, i.e., around 25% of the cerebration and activity that preceded sales thinking was essentially in the realm of marketing, and 75% in the realm of sales. With all the tectonic shifts that have taken place, marketing thinking in the new world is likely to be 75% and sales thinking 25%.”
This figure may vary depending on who you talk to. Mckinsey estimates that preference for digital among Indian B2B companies is 1.4x more than traditional sales interactions. Around 70% companies surveyed admit that online GTM model is just as effective, or more than the traditional model. Further, around 56% are ‘highly likely to sustain the shifts even 12+ months post-COVID.
Preparing for an increasingly online B2B world
So while the pandemic is cataclysmic, it is also a vital opportunity for every B2B business to retrospect on their ‘digital-readiness’. It is clear that ‘online’ will remain critical to survival during the pandemic. And even when the virus recedes into history, it will remain important, as companies may find some modes of engagement more fruitful through an online interface. Following are some of the strategic decisions that companies can take:
Beef up your online presence
Companies now need to seriously look at their digital assets – website, social media profiles, etc. In fact, companies and their employees may even have to be guarded in what they share online on their personal profiles. In a few clicks it is possible for clients to know everything about your company, its employees and their views, their connections, the market landscape, competition, just about everything. It is very important to be genuine, well informed and guarded vis-à-vis your online presence.
If your salespeople cannot reach the customer, content marketing has to step in to bridge the information and trust gap. According to Prof Seshadri, case studies (of successful outcomes achieved), best practices (for helping clients manage their business), how to guides (on your product and service offering), market trends, product features and competitive comparisons should all be developed and easily available (and in this specific order of listing).
Moreover, newer forms of content like video need to be given more prominence. And given the shift in habits, in-home channels like web streaming, gaming apps and TV channels gain more prominence.
Understanding and leveraging analytics: Marketers need to pay attention to numerous data points that are now available – reach, frequency, ROI, audience, and targeting. This can also improve their targeting strategies and provide vital inputs to new innovation. Dr Anupam Narula, Amity School of Business, Amity University, Noida, emphasizes:
“Now more than ever, marketing professionals must focus on fostering meaningful relationships with their customers and must enable customers to provide inputs into their brand experiences. Gartner predicted that over the next three years, around 60% of digital commerce analytics investments would be spent on customer decision journey (CDJ) analytics.”
From metrics like lead generation, trade shows and events, marketers would have to shift their budgets to areas like AI-driven programs and analytics to improve their understanding of the customer decision process and better their market approach strategy. Anand Ramanathan, Partner, Deloitte India, opines:
“Enriching human experience from both a customer and employee perspective will dictate business utilization of AR/VR, AI/Machine learning and other exponential technologies for transitioning “high touch” experiences in an office environment into the online digital world powered by e-commerce, mobile apps and other convergence platforms.”
Being a good corporate citizen
This is the time to be more understanding of the unique challenges and constraints that your clients face. Salespeople may have to forego their unrelenting focus on bottomlines for the time being and be more supportive of their clients. According to Dr Narula:
“Those B2B brands that will invest in community and society will create a unique opportunity for them to lead in B2B market place. Being human is the only way to get ahead in business today. The businesses that will adapt and shift their messages from ‘What my offering can do’ to ‘How we are helping the community in solving an immediate pain’ will thrive in the post-COVID period.”
It is a unique scenario within the surging digital usage, wherein the relevance of human interface becomes even more relevant. Kaustav Sen, KPMG India, advises B2B marketers and salespeople to collaborate to create win-win solutions:
“Customers are looking for tailor made offerings, within the realms of mass customisation, which are effective in solving their business challenges. For example, a project developer/owner will expect an EPC partner today to advice on how best to deploy cash to prioritise project portfolio/segments so that the owner’s cash flows are expedited rather than only mundane project management efficiency.”
On a larger plane, companies also need to look at ways they can contribute to society in this crisis situation. Instances of this are companies like Google, Facebook, Twitter, Microsoft, LinkedIn and YouTube, which are all working with governments and scientists to combat the virus, misinformation, and fraud.
Redefining sales team dynamics
The importance of human interface, especially in complex and strategic sales will remain, while it may diminish for non-strategic buying decisions. But marketing is undeniably now playing a critical role in at least the first three stages of customer buying (awareness, exploring solutions and comparing competitors) and also the final stage (purchase) – irrespective of the sector. So, salespeople will do well to equip themselves with marketing and digital skills.
A blend of marketing and technology talent will be in high demand. In fact, sales and marketing professionals are key drivers of digital transformation in organisations today, and not the technical people.
Prof Seshadri also sees a strong inter-generational conflict brewing in organisations between the digital savvy millennials and the not-so-digitally equipped middle and senior management. The former may find current organisational structures and career progressions primitive and slow, while the latter may feel threatened by the growing relevance of young talent. These conflicts need to be managed effectively to ensure synergies, so that a company can benefit from the best of both worlds.
Get rid of the commodity mindset
This comes from the notion that B2B companies harbour about marketing being redundant, which I discussed at the beginning of this article. Building B2B brands has growing in importance with the rise in digital interface as well as the growing competition. India has hardly ever been short of enterprise, and now with the advent of so many funding options for startups and small enterprises, good ideas find it relatively easier to find seed/growth capital.
Sourav Borah, Asst Professor, IIM Ahmedabad, believes that branding investments are a strong buffer for B2B firms as well, even for a highly commoditised market like carbon dioxide. A brand helps you differentiate and also enhances your ability to diversify into related sectors, as and when needed. A case in point is the manner in which automotive companies diversified into ventilators during the onset of the COVID-19 pandemic. Moreover, a brand can help you sustain in such testing times, wherein trust is a difficult commodity to secure, given the absence of the ‘physical handshake’ in the B2B world.
Virat Bahri is Editor, India Business & Trade and Deputy Director, Media & Corporate Communications, Trade Promotion Council of India