thefunnel

What is the value and how do you measure a B-2-B brand? A common theme in marketing literature is that the value of a brand can be expressed by two factors: Are customers willing to recommend you, and are they willing to pay a premium? Both factors are obviously good to know and have their own implications on your position and marketing / pricing strategy, but before you start to drill down deeper into the recommend factor, you really don’t have any actionable insight. To look what’s behind whether or not someone will recommend you, you have to look at individual brand attributes. Every brand is different, and you can go as deep or wide as possible, but for many B-2-B products it comes down to the following higher level categories: Price, Product quality, Quality of service and support / technical support, Knowledge of the sales organization / representative and product fit to the customer need. Each of these can be individually measured to further understand for what attribute a company is under-performing or performing well. But, that is not enough, because all customers are not equal and every attribute must be further segmented by various types  customer. At a minimum these are customers, non-customers and competitors customers. Depending on the company strategy existing customers might also have to be segmented into key accounts and others. In addition attributes needs to be segmented by product category. All this creates a challenge for marketers in regards to the qualified sample size, but since brand perceptions change slowly for many b-2-b products, it’s better to measure extensively less frequently, rather than do quick on the surface assessment that only provides artificial non-actionable benchmarks.

The saying goes, “The only reason you need advertising is because the market isn’t talking enough about you”.  So, how do you get buzz going? All sorts of PR is definitely one tactic that you could use, but there’s another one that’s even better – WOM.

WOM (word of mouth marketing) is in some industries one of the most effective, but also one of the most under utilized marketing tactic. Why is that and what are some of the challenges?

The biggest problem in some B-2-B industries is that the customers aren’t emotionally (emotional branding) attached to the product . The product is often just a tool for them to get the job done.  Consider this. Not too many people walk around talking about, for example their measurement gear, unless of course there’s a problem, which would mean bad WOM. Then there aren’t that many opportunities or incentives for customers to publicly express their opinion, sometimes by design and sometimes by default. By design, many companies aren’t allowed to share case studies or comments for confidentiality reasons. Some companies ban endorsements completely, and a WOM without the source (a credible source) is only a marketing ploy. By default. Some industries are slow to adopt social web for business purposes, because they don’t see the business value in it, or going back to the branding point, they are not interested talking about their tools. There’s also another challenge in making WOM successful, which goes back to endorsements. When asked to rank information sources in a survey, many customers state that WOM is one of the top 3. The problem is that when you drill deeper into the sources of this WOM, it often comes from within the company, rather than from other companies. This means that it’s really hard for marketers to capitalize in a larger scale on WOM. Problematic particularly for products that are somewhere in between commodity and strategically critical to a business.

NPS (net promoter score) is an interesting and somewhat popular measurement of customer satisfaction and loyalty, but does it work and what does it really mean for B-2-B marketers, and what can they do about it?

Quick definition: Would you recommend a product or service on a scale between 0 and 10. The 9 and 10 are promoters and, 0 – 6 detractors and 7 or 8 are passives. Subtract from promoters, and you have NPS.  A NPS score of 60 – 80% is considered high.

Let’s now look at a few considerations facing B-2-B marketers

• Are you going to include both customers and non customers in the metric? If you do / or not understand why.
• In your industry, does the score vary by your different product categories?
• Is it a measure on service, support or product capabilities or all of the above? How do you know which one to improve?
• What does the score mean for products for which you are the market leader versus products that you are let’s say #3 or #4?
• What do you do when scores are high, but you’re still not gaining market share? How do you reason this?
• If you have a high score can you charge a premium? What about non customers, are they going to pay a premium as well?
• For products which are purchased infrequently how do you make sure that what customers say they intend to do, is what they actually do?

An example (let’s assume small business B-2-B). I own a PC. Certain brand. Would I recommend? Yes, probably =9. Will my next PC be the same brand? Maybe, maybe not, it depends. On what? What else is out there? What the price is? Maybe I just want some variation!The fact is that I don’t consider myself in anyway disloyal, even if I buy another brand. However, maybe the third time around (5 years later), I’ll go back to my first choice, if all things are right.