Study: Why B2B Marketers Waste 19% of Their Budgets
Imagine that you were only getting 81 cents of value out of every dollar you spent. If you only wasted a few bucks, it might be okay to eat the occasional loss. But over time, those losses would add up, and it probably wouldn’t take long for you to start rethinking your spending habits. Now put yourself in the position of someone investing billions of dollars. How important would it be for you to fix that loss?
B2B marketers spend roughly $5.2 billion annually on content marketing, but $1 billion of this total is reported lost due to “inefficient” spending. As B2B content marketing continues to boom, it becomes even more important for companies to understand exactly how these funds are wasted. Where are B2B marketers going wrong?
A recent LinkedIn study of 6,000 B2B marketers, salespeople, and customers from around the globe examined the disconnect between spending and outcome, detailing why marketers have been looking at the wrong indicators. Here’s a breakdown of the top takeaways from the report, including strategic alternatives that can help marketers get the most value out of their content investments.
Don’t neglect the middle of the funnel
Knowledge exchange is a huge factor for B2B buyers that are deciding on vendors. And this knowledge can come in many forms such as industry expertise or specific insight on the prospective buyer’s company.
Product information, data sheets, and demos contain important information, but according to the report, this collateral alone is not enough to earn buyer trust.
Instead of focusing on final-sale material, the report encourages companies to nurture their audiences with mid-funnel content that demonstrates expertise and inspires an honest, helpful dialogue. This content typically consists of newsletters, e-books, case studies, industry-level facts sheets, white papers, or anything else that serves to educate and engage the reader.
For example, GetResponse’s 86-page e-book, “How to Write Newsletters That Get Opened, Read and Clicked,” does a great job of nurturing marketers with information on how to improve their mid-funnel strategy. The benefits are twofold. First, the e-book addresses a pressing need: helping B2B companies improve their newsletter strategy. Second, it positions GetResponse as a subject-matter expert.
Adapt your content for the right touch point
According to the study, the average B2B buying decision involves three or four different departments, led by IT and finance. The collaboration shouldn’t come as a surprise—most products and services are not isolated for a single use. Smart investments are versatile, helping different departments accomplish different goals for the same organization.
To maximize the efficiency of their marketing budgets, B2B brands should focus on segmentation to address specific departments, dividing their target market into groups that aren’t determined by traditional demographics—age, income, and location—but instead by company role.
For instance, marketing directed at IT, which usually covers product information, should be separate from content aimed at finance. In other words, don’t talk to the director of sales the same way you would the head of development, but know how their decisions affect one another.
Prioritize trust over price
For the most part, buyers have favorable opinions of their vendors. In fact, the report claims that vendor relationships are at an “all-time high.” Eighty-four percent of respondents had positive things to say about their marketing partners, and 54 percent rated their vendor relationships as good.
But these vague descriptions don’t always paint an accurate picture. Words like “good,” “satisfactory,” and “fine” are notoriously misleading when it comes to predicting the health and longevity of a business relationship. Instead of examining the bland taxonomy, the study suggests focusing on why certain relationships get stronger at a faster pace.
In the chart below, trust and personal connections are the biggest reasons that buyer relationships get stronger. Interestingly, monetary value is down the list. That’s not to say price isn’t important, but the data suggests that personal interactions have more of an impact once buyers and vendors start talking to each other.
Know what content your audience wants
When entering the final stages of the buying process, buyers and marketers seem to be on different wavelengths. Per the report, there are some critical discrepancies that could be hurting deals near the end of the sales cycle. For example, per the chart below, 35 percent of buyers believe that product information is the most effective sales content, but only 24 percent of marketers feel the same way.
Marketers appear to be overvaluing the importance of peer testimonials and case studies the most, which could be one of the main reasons that approximately 20 percent of B2B marketing spend is wasted.
While educational mid-funnel content helps nurture leads and build trust, these bottom-funnel materials are time sensitive. The issue isn’t whether or not buyers want this type of content, it’s at what point they need it.
Unique viewers, downloads, email subscriptions, and social shares are critical at the top of the funnel. But marketers go astray when they apply these same metrics to different parts of the funnel that are better off focusing on analytics that look at time on page and lead scoring. From this chart, we can conclude that awareness and thought leadership pieces in the middle of the funnel may enhance engagement strategies, but data sheets and demos are more likely to close a deal.
With that in mind, marketers should think carefully about their calls to action. Instead of a white paper or e-book, prospects near the bottom of the funnel will likely be on the lookout for a simple explainer video or product trial.
Take a look at analytics software company Panorama for a good example of how to think about this dynamic:
Panorama displays a series of product demo videos before offering a free trial on its product page. There’s a natural progression to the setup that buyers seems to appeal to buyers.
What you need to remember
It’s easy for B2B marketers to get tied up in vanity metrics and stress about the pressure to prove ROI. But to fully address the discrepancy between dollars spent and dollars wasted, sales and marketing teams have to get on the same page when assessing buyer preferences. As LinkedIn’s study reminds us, what we believe about marketing behavior is not always what’s true.