B2B marketers focused on high value solutions know that customer evidence is like gold. Great products may sell themselves based on features or price. But when you're asking business buyers to invest serious money in a complex solution, typically involving a customized mix of products and services, they need to know you've done it before and that other customers have derived real business benefits.
Not surprisingly, sales people selling solutions say that customer references are their most valuable tool. ITSMA has found this repeatedly in sales studies. Similarly, a recent internal study by a very large technology solutions provider found that their sales people said customer references were absolutely essential for selling new strategic solutions.
The growth of formalized reference programs in recent years reflects a growing understanding that documenting and promoting customer evidence is too important to leave to ad hoc initiatives in PR or sales. The success of the Customer Reference Forum in building a broad-based community of reference managers is another sign of a maturing discipline.
Too often, though, reference programs remain short-staffed, disconnected from other key marketing programs, and overly reliant on the kindness of individual sales people to provide access to satisfied customers. Indeed, many formal reference programs continue to vie for marketing and sales attention with the parallel existence of informal, fragmented reference initiatives across the organization.
As a result, many reference programs remain stuck in tactical, reactive mode. They crank out case studies and testimonials to support marketing launches and events but have relatively little impact in accelerating strategic sales or deepening loyalty with the most important customers.
Benchmarking the Best
Over the past six months I've had the opportunity to work with several large B2B firms to improve their customer reference programs. Along the way, I've been able to review a number other programs with companies widely acknowledged as reference management leaders while also review industry data and talking with a batch of vendors, consultants, and program managers.
Comparing the best with the rest, six programmatic building blocks are particularly important for programs that provide substantial business impact.
Constructing the six building blocks is no simple matter. Talk to the heads of the best programs and you'll hear about years of work, substantial investment, and constant attention to internal as well as customer relationships. But you'll also hear about serious business benefits like direct contribution to $ millions (or hundreds of $ millions) in revenue, critical support for new solution offerings, and measurable improvements in key customer relationships. The investments, in short, are well worth it.
Active use of compelling customer evidence is far from the only determinant of solutions marketing success. But having a well developed program that provides a steady stream of customer advocates and credible content certainly makes it easier. If you're looking for ways to create a stronger foundation for customer evidence-based marketing and a more effective reference program, the six building blocks are a great place to start.
Do you agree with the list? What's working and what's most challenging for your program?
Michael Shrage’s recent Harvard Business Review post, Great Customers Inspire Great Innovations, got me thinking:
Why, amid so much evidence of the power of customer-centric business, are so many companies still mired in inside-out operations? Why do we hear so much talk but see so little action?
Shrage’s post reminds us that behind most great innovations lie customers and clients that made those innovations possible. "Busicom, a scientific calculator company, for example, commissioned Intel [in 1969] to design a chipset for its new programmable calculators. That led directly to Intel’s breakthrough creation of the microprocessor." On a much broader scale, "Wal-Mart’s incessant and relentless demands for ‘everyday low prices’ transformed every supplier it touched."
Shrage’s post also reminded me of an essential book from way back in 2003 by IT industry analyst David Moschella, Customer-Driven IT. Taking off from the familiar point that the tech industry was always led by vendor-based innovation, Moschella outlined the fundamental shift underway in the early 2000s toward customer-driven innovation in industries ranging from media and financial services to health care and education.
Ranjay Gulati’s more recent Reorganize for Resilence provides similar testimony, evidence, and examples of the power of customer centricity for solutions development, marketing, and sales (you can watch my partner Steve Hurley’s interview with Ranjay on our new YouTube channel).
Shrage, Moschelle, and Gulati are actually making a critical point beyond the normal blah-blah about listening to customers and strengthening relationships. As Shrage notes, even this approach (which is typically more talk than action) is not enough. Rather:
"The essential question is who are the customers that come with the problem sets and parameters that push you to rethink, or redefine, your business? Which customers and clients does your firm celebrate as innovation partners -- and why?"
What amazes me, though, is why B2B marketers aren’t investing more in serious programs to build key customer relationships, generate deeper customer insight, and build stronger customer collaboration at least as a foundation to help drive that necessary innovation.
After all, it’s not just academics and pundits like Shrage, Moschella, and Gulati pounding their fists. IBM’s latest survey of more than 1,500 large enterprise CEOs around the world showed that 95% of top performing organizations identified getting closer to customers as their most important strategic initiative over the next five years.
It is happening to some extent, of course. In B2B technology, where I spend most of my time, a number of companies are putting some real money where their mouths are. For example:
More often, however, I see situations where the rhetoric far outpaces the reality:
Needless to say, all three of these companies, like most of their peers, prattle on endlessly that "we're all about the customer."
For B2B marketers interested in moving beyond the rhetoric, there are some obvious next steps:
If all this investment means cutting back in other areas, well, that's the price of truly changing strategy and priorities.
As always, though, it's the mindset that matters most.
I was reminded of this for the umpteenth time last week while pulling together some research around customer reference programs for a client. Most tech companies have a reference program, but far too many are focused transactionally on getting customer testimonials and promoting success stories. There's relatively little attention to actually learning more about customer needs, strengthening relationships, and building collaborative innovation (with some notable exceptions, of course).
These are your best customers, folks! If you're stuck in selfish transaction mode with them, there's a long way go to in getting to customer centricity.
Am I right to be so critical? What's working for customer-centricity on your end?
Photo credit: everywhereisimagined
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Back when my partners and I were developing some of the early methodology for account-based marketing in the early 2000s at ITSMA, it was a tough sell. We had seen strong results from ABM pioneers, such as Accenture, IBM, Xerox, and HP, but the costs of doing ABM were clearer to many marketers than the benefits. It is, after all, a pretty labor-intensive approach, and it requires a lot of negotiating with sales and account teams. Much easier to just spam the market with generic emails, webinars, brochures, and the like.
As marketers began to appreciate the value of more focused approaches, however, such as vertical industry marketing, as well as the critical importance of their top accounts, ABM began to take hold. By 2005-2007, many of the top B2B tech and IT service firms were experimenting with ABM. We were going great guns at ITSMA with research, workshops, an ABM Council, annual ABM awards, and, of course, direct consulting and training to help companies get started and succeed.
What many marketers realized was that developing highly targeted programs for individual accounts yielded a great many benefits, both externally and internally. Externally, ABM can generate substantial improvements in customer relationships, brand perception, solutions proof points, revenue, and profitability. Internally, ABM can help prove the value of marketing, improve relationships with Sales, and strengthen focus on core customer challenges and potential solutions.
New research from Alterra Group suggests that ABM has also gained traction in professional services. According to a recent survey, some 86% of consulting and other professional services firms are now using some form account-based marketing, and looking to further increase spending on ABM in the years ahead. Large majorities of survey respondents further suggest that ABM has a higher ROI than other marketing approaches, and provides significant benefits in terms of retaining clients, increasing revenue and profit, and attracting new clients.
Not surprisingly, the research also found that companies investing more in ABM and paying more attention to program metrics are achieving greater results. (One would certainly hope so!)
I know we're all focused heavily on figuring out how to "socialize" everything in marketing these days (with good reason) and, especially as the 4th quarter looms, on doing whatever we can to help close sales before the end of the year. If you've let your ABM efforts lag, however, or not yet begun to invest in the approach, the Alterra Group research should be yet another set of data points convincing you to keep ABM front and center.
From our own experience, I'd like to suggest four critical success factors that go beyond simply spending more money and measuring results:
Is ABM here to stay? Let's hope so; it's one of the most effective approaches we have in B2B marketing. Making sure we do it the right way, however, is the real test, and shortcuts are not likely to show such great results.
What do you think? Are you implementing ABM? What's working for you?
Photo credit: hapticflapjack
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I've just had the privilege of helping judge ITSMA's Marketing Excellence Awards, and was impressed in particular with the submissions in the Thought Leadership Marketing category.
As recently as five years ago, thought leadership marketing was mainly the province of the top consulting firms. Few other B2B firms took it seriously. Boy, has that changed! The submissions in this year's awards program reflect a substantial increase not only in spending but, more important, in the programmatic discipline that is necessary to make a serious impact with customers and market influencers.
I can't name names yet because ITSMA is still selecting finalists and then the ultimate winners. It's clear from the submissions, however, along with working with many of these companies over the years, that there are five important ways in which the best of the best stand apart from the crowd:
What's missing from my list? What works best for you?
He's a bit like a kid in a candy store: he's got budget to spend, executive support for a more ambitious marketing program, and a relatively clean slate upon which to draw the new strategy.
The existing program has been pretty traditional, focusing mostly on collateral, events, advertising, and direct support for the sales team. He knows that's not enough, and is definitely interested in doing more with thought leadership and social media, but how best to reshape the overall strategy is not entirely clear.
Asked for some advice, I agreed with a stronger emphasis on thought leadership and social media (which I think are appropriate for all B2B firms), and I questioned the value of putting so much energy into advertising and collateral.
More generally, though, I suggested that the strategy focus on the four marketing engines that I think all B2B firms need to have running smoothly to ensure business success.
Four Engines for B2B Marketing Success
As the need for more and better content continues to grow, marketing leaders have realized that they need an integrated "content engine" that consistently produces compelling content for every stage of the buying cycle. This includes thought leadership content to help build reputation and interest, educational content to support lead generation and nurturing, solutions and customer success content to support sales conversations, and, of course, social media content to support ongoing connections with customers and others.
B2B marketing rises and falls on the strength of the company's relationships with customers, prospects, partners, and market influencers. For many marketing organizations, though, the objective of building, strengthening, and sustaining key relationships has no clear owner or strategy. A "relationship engine" may sound awkward but the idea is to ensure a comprehensive, consistent, and focused approach to strengthening critical stakeholder connections to increase sales, loyalty, and market insight. This should work across such areas as events, customer councils, account management, references, and social media.
Lead Development Engine:
The increasingly long and convoluted purchase processes that B2B marketers face puts a premium on well organized systems for lead nurturing and management. No longer can we focus on just the early stages of generating leads and then throw them over the wall to sales. More and more, we need to stay in the game with longer term programs to develop and sustain opportunities in close coordination with sales. Content and relationship programs contribute substantially to this effort but someone also needs to own the overall system for lead development, including qualification, scoring, nurturing, and assessment.
Solutions Development Engine:
Like many B2B companies, my friend's firm has a long history of successful products, satisfied customers, and productive partners. At the same time, also like many B2B companies, his firm is feeling the heat from increasing competition, margin squeeze on products, and buying decisions moving higher up in their customers' organizations. The result is a need for higher value solutions that respond more specifically to individual customer needs. Doing this efficiently and effectively means moving past the one-off approach based solely in the field. Instead, marketing needs to guide and support the field in determining top priorities for new offer development, crafting the right value propositions, and routinizing the process with the right stage gates and metrics.
The four engines don't cover every last aspect of B2B marketing, but they come pretty close and they provide a clear framework for building a comprehensive strategy that balances short- and longer-term success. Get each of the engines humming smoothly and results are sure to follow.
What do you think? Am I missing something important? Are all of your engines in good working order?
Photo credit: Imnop88a
Posted at 01:14 PM in Advertising, Campaigns, Creating Demand, Leadership, Marketing, Organization, Relationships, Revenue, Sales, Social Media, Strategy, Thought Leadership | Permalink | Comments (3) | TrackBack (0)
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We all know that social media is increasingly central to how we get our news and information. The main finding in this new report is that Americans use different media for different types of information.
Analyzing a year of data on the top news stories discussed, linked to, and viewed on blogs, Twitter, YouTube, and other social media, the Project found that, "the stories and issues that gain traction in social media differ substantially from those that lead in the mainstream press. But they also differ greatly from each other."
Topically, for example, there is much greater focus on technology-related news with social media. Further, Twitter has emerged as a key source for breaking news. YouTube is more about serendipitous surfing for randomly interesting content. Blogs tend toward more emotional stories and stronger partisan orientations (on all sides).
So what's the B2B marketing connection?
Several months ago, I wrote about Marketing as media: Are you in the top five? My suggestion then was that given the incredible time constraints under which our customers and prospects operate, we need to think about being a "top five" information source. They don't have time to pay attention to much more than that. So you're really competing for attention with sources like The Wall Street Journal and BusinessWeek along with leading trade publications, blogs, and social networks, regardless of what particular market niche we're in.
I still think this is true, but today's research makes me think more about how you carve out the right position in the broader business media landscape.
Of course you need to focus on the issues where you have expertise and the markets you serve. Of course you need to provide useful and interesting information. Those are table stakes. But beyond that, where do you fit more specifically for your customers? What do they expect from you? Most important, why do they need your information?
This is not a question about using different media channels for different types of information, although that's indeed important. And it's not about which format is best (white papers vs. videos vs. blog posts, etc.). It's really a question of editorial strategy.
I'm not suggesting that it's all or nothing, that you have to pick one thing. But trying to be all things to all customers is not likely a good route to success. Thinking more about the "why us?" question can only help in developing a more effective editorial strategy.
What do you think? What's your editorial strategy?
Photo credit: stevenharris
Along with loving the music and concerts, I've always thought the Dead's freewheeling, performance-oriented approach represented a great example of American entrepreneurship.
Indeed, long after the vast majority of hit-focused, corporate rock bands had faded from view, the Dead kept on trucking to become one of the top grossing bands of all time despite a distinct lack of mass appeal. No less than the Atlantic magazine recently published an ode to the Dead's business acumen, Management Secrets of the Grateful Dead.
For marketers, the HubSpot webinar, led by certified Deadheads Brian Halligan of HubSpot (100+ shows) and social media writer David Meerman Scott (42 shows), was filled with great examples of how the Dead's success foreshadowed so much of what we're just now taking seriously with the shift to social media.
For me, here are four key takeaways (leavened by my own experience at 20+ shows over the years):
Last year, I saw the Dead play in Worcester, MA (my hometown), 14 years after the death of spiritual leader Jerry Garcia. The experience was invigorating, the music was great, and the ethos remained true more than four decades from creation. Inspiring, to say the least.
B2B marketers know that thought leadership is essential, especially when selling high-value solutions. Business buyers tune out most traditional marketing, but they are always looking for new ideas. If we can produce interesting and useful content, and use social media and other platforms to spread the good word, we at least have a chance of getting into the conversations that our customers and prospects actually want to have.
Perhaps not surprisingly, thought leadership topped the list when ITSMA recently asked marketing leaders at big tech and IT services firms which tactics will be more important in 2010. According to ITSMA, 77% of respondents cited thought leadership development as a priority, beating out references and testimonials, senior executive programs, and social media.
For most B2B firms, however, thought leadership is getting a great deal more lip service than investment. Other than top consulting and professional service firms like McKinsey, Deloitte, and Accenture, few B2B firms have yet created a focused and well-organized thought leadership marketing program. My own recent review of 72 corporate members of the Institute for the Study of Business Markets, for example, found that only 24 of these manufacturing, industrial, and technology companies even had a link to thought leadership content on their home page.
All too often, thought leadership in B2B is thinly funded (if at all), episodic, and superficial.
To make a real impact with customers and create real distinction in the market, thought leadership needs focus, depth, and continuity.
Consider, for example Accenture's years-long in-depth research on high performing companies. They focus on strategic challenges facing each industry the company serves, orient primary research and publications to different executive roles among their client base, and deliver insights across a wide range of online, face-to-face, and social media platforms.
Not every company has Accenture's deep pockets, to be sure, but the lessons are clear. And it's not just a matter of blogging more and getting more content onto Facebook, Twitter, and YouTube -- although social media clearly IS critical for thought leadership dissemination and engagement.
At a more fundamental level, companies looking for greater impact with thought leadership need to consider four essential dimensions of program development: