Long-term reach or short-term targeting?
According to a LinkedIn survey, only 52% of B2B marketers believe reach is a strong predictor of advertising success, and over 65% believe that businesses grow by increasing loyalty, not customer acquisition. But have they got their priorities right?
LinkedIn’s B2B Institute has identified five principles of growth in its latest report, wherein Peter Field and Les Binet explore B2B advertising to drive growth.
The report argues that branded advertising remains essential to long-term growth for B2B, as well as B2C, businesses. Though businesses in their early years can get by on word of mouth and repeat custom, the report says, the pool of easily exploited prospects will eventually run dry. For further organic growth, advertising is essential.
Field and Binet’s five principles are:
- Invest in share of voice – to grow, set your share of voice above your share of market
- Balance brand and activation – aim for a 50/50 split between long-term brand building and short-term sales activation
- Expand your customer base – create a broad reach and target new customers
- Maximise mental availability – aim for fame
- Harness the Power of Emotion – long-term brand building is emotional
The report shows that investing in share of voice is equally effective for B2B as it is B2C brands. This is valuable information for budget setting.
It argues that budget should be balanced equally between long-term brand building and short-term sales activation. Brand building creates long-term memories and associations that continue to influence purchasing decisions long after an advertising campaign ends. The effects last longer and are accumulative – the report describes brand building as ‘the main driver of long-term growth and profit.’
Though it appears that building loyalty is the most effective route to growth, given that acquisition costs are avoided, B2C research implies otherwise. The main way that brands grow is by acquiring new customers, and loyalty tends to increase as that happens. The LinkedIn research suggests that this remains true for B2B businesses. Customer acquisition strategies are more effective than loyalty strategies, and reach strategies are the most effective of all.
But reach alone isn’t enough: B2B brands should aim to achieve ‘fame’. Given a choice between several options, people tend to prefer the one that comes to mind most easily. The importance of mental availability is a given in B2C, but it’s often assumed that B2B buying decisions are more rational. The report suggests that’s not always the case.
In fact, decision making in B2B is only slightly more driven by rational thinking than in B2C. Emotional messaging is particularly important for long-term activity, while rational messaging is better suited to the short term. Long-term brand building involves the creation of positive associations, which in turn creates positive feelings around your products. You build these memorable associations via emotional advertising, rather than messaging around product functionality, for example.
So what do you think; does emotional, brand building messaging deserve the same amount of budget as more sales-led, targeted strategies? Are B2B marketers paying enough attention to brand and reach? And how do you get around the fact that softer, top-of-funnel initiatives are harder to prove ROI on?