B2B Marketing: Where Emotion Fits
Over his more than 30 years of teaching and consulting, Ken Wong has seen an evolution in the marketing function and the management of brands. In this fourth in a series of video commentaries, Wong, Distinguished Professor of Marketing at Smith School of Business, talks about the similarities between business-to-business and business-to-consumer marketing and the importance of keeping the business end user involved in the purchasing decision.
The whole notion of B2B (business-to-business) versus B2C (business-to-consumer) was largely driven by the kinds of instruments we used to communicate with consumers. In B2C, purchases were usually relatively small and we had to rely on mass media to get the message out. By contrast, in business, we typically didn’t see the consumer as looking for information on business products while watching TV shows or reading magazines. Instead, whatever advertising in print that we did was created to generate leads for a sales rep.
The reason we could justify the cost of a sales rep as opposed to relying on mass media was because we expected that business account to be significantly large. A single business account could represent as much sales revenue opportunity as we would experience selling to an entire market segment.
What we failed to realize — and it’s embarrassing that we did — was that one size rarely fits all in marketing. There are many business products that are not bought in massive quantities and where it’s hard to justify a dedicated sales rep. Think office supplies. I don’t know of a paper clip company that has a sales rep talking to companies. That’s all done through retail with the backing and support of sales promotion and advertising, just like it is on the consumer side.
More fundamentally, though, we always believed that when organizations bought products, there was a rationality, a procurement policy that was objective and that removed the individual from decision making. As such, business to business was always considered more based on fact than emotion. That’s not true, and it hasn’t been true for a long time. One need only look at the computer revolution in the 70s and 80s, and the famous tagline, No one ever got fired for buying IBM. At a time when everyone was uncertain about what operating system would become industry standard, IBM was there with security. It wasn’t about specs. It was about protecting your hind side and your job.
We sometimes forget that organizations don’t buy products. People in organizations buy products. And they approach that purchasing task with many of the same tools that they learned as individual consumers.
Having said that, there’s no question that we see a drive on the part of many businesses to handle purchasing by procurement. Once you’re dealing with a procurement department, the buyer is telling you that your product is well understood, that there’s no need for elaboration because there’s no way you can “add value” to what you’re already selling. It’s about the cheapest source of supply.
What that tells us is something we’ve always known but sometimes forget: you never go back to a customer selling a product over and over because the moment you do that, you remove the end user from the purchase decision. When that happens, all of those extras you engineer in to make the offering more productive or convenient don’t gain any value in the eyes of procurement. Procurement will look at you and say, If you want a premium for those conveniences, talk to the product person buying the product. Once it comes to my desk, I’m buying to a spec. So we always want to have the end user involved in the purchase decision.