While much of the hype that brought business-to-business marketing its 15 minutes of fame has waned, the challenge of marketing effectively to business customers is real and best practices continue to evolve. One example of this evolution is the “organization model” approach.
Imagine your company is planning to make a big technology purchase. Who within your organization would authorize the expenditure? Most likely, it would be the chief information officer or chief financial officer, or perhaps both. Yet, in reality, these decision-makers are only the tip of the overall purchasing cycle.
Typically, the larger the investment, the more complicated the review process. A technical committee might be formed to evaluate available solutions and make recommendations. Line of business managers might be brought in to represent the user groups. If the rollout is global, companies will consult their overseas operations about compliance, standards and usage. Moreover, many companies today conduct much of their business electronically and will seek feedback from partners, suppliers, customers, or all three.
Despite this complex web of decision making, traditional direct marketing and lead-management models still mainly target individuals. Tradition harks back to the Dale Carnegie School of Sales and Marketing, when success depended on forming a personal relationship with a key decision-maker and learning everything possible about that individual to build loyalty and trust.
CRM has matured, business processes are following suit. The early promise of customer relationship management software was to develop one-to-one relationships more efficiently. But while the first-generation of CRM programs gave companies the means to track customer interactions across touch-points, BTB marketers continued to target only a few individuals for each account. In other words, new technology applied to an old business practice did not actually result in the targeted marketing companies expected.
Times are changing. Marketing divisions are moving to a single, expanded view of their customers. Companies are engineering business processes to support end-to-end workflows instead of managing the organization as discrete units, each with its own charter and proprietary data. As a result, today’s Web-based enterprise applications place an unprecedented amount of customer information at the disposal of the enterprise. The real challenge is putting the information to work.
In the future, organizations that restructure global operations to embrace the nuanced, multi-layered nature of business decision-making will find success. Companies already using this model have adopted a multi-tiered model of lead generation. Instead of studying only the activities of key individuals, they profile the entire organization and its unique purchasing process — in much the same way an entomologist studies the activity in a beehive.
The activities can range from requests for information, Web site searches, event attendance, telesales interactions, downloading white papers, quarterly earnings or product collateral, and responses to promotional activities (i.e., click-to-banner), etc.
By analyzing the breadth of customer activity across an operation, a marketer identifies not only decision-makers but also that far more elusive group of company influencers. If a company is part of a targeted marketing initiative, how did the organization respond?
In the past, a company might have tallied the number of leads generated and then sent the names to its sales force as qualified prospects. Now, that same company looks for signs of activity across the enterprise. The finance department might be asked to look into a vendor’s fiscal status and download financial reports. An IT employee might print technical information from the Web site. Human resources might research what skill sets and knowledge bases are required to support the technology.
Smart companies develop statistical models and timelines of these actions to understand how different individuals and groups within the organization shape and inform the buying process. In addition to establishing the chain of command, this allows them to map organizational behaviors as a series of steps and helps them understand the groups they must engage. As a result, companies can develop more effective marketing and demand-generation programs.
“Successful business-to-business companies recognize that the business-to-consumer model of marketing to individuals is not optimal for their business,” Walter Janowski, a research director at Gartner Research, said in a recent conversation. “Individuals may only influence decisions within their own realms, but not across the enterprise. For instance, more often than not, the buyer is not the actual user. So organizations need to understand the customer as a whole to develop a broad view and understanding of the company’s processes and needs. Putting together the big picture leads to more effective BTB marketing.”
Not only does technology exist to support this “hive-like” model, the solution consists of standard, Web-based enterprise software solutions with built-in business intelligence and analytical tools for coordinating marketing, sales and CRM activities across channels, geographies and lines of business.
The foundation of the solution is a single data model, a structure in which a computer program stores customer information and relates it to other information, like products and services purchased and accounts receivable.
This gives marketers two strategic advantages. First, instead of making business decisions based on stale, aggregate data — i.e., third-quarter sales revenue numbers for Europe — the company has access to granular, real-time information. Managers can then assess in detail, say, the impact of a promotional campaign on retail sales in a metropolitan market over a given timeframe.
Second, advanced analytical tools now enable companies to “connect the dots” across a customer organization. That is, they can monitor and analyze all transactions and activities across departments, geographies and practice areas — and then “slice and dice” the data to perform high-level statistical studies.
Numerous benefits to an organizational model. Employing an organizational model is far more predictive than looking at individual behavior. And just as no two companies are exactly alike, there is no homogenous buying process. Therefore, rather than projecting your own goals onto an organization, it is far more constructive (and ultimately, profitable) to build a marketing strategy that maps to that organization’s real-world needs and decision-making process.
Obviously, the more you know about a customer, the better you can anticipate their needs. At Oracle, our customer-facing systems are directly linked to back-office functions: finance, supply chain management, enterprise resource planning, manufacturing and logistics. This enables us to build individual customer strategies leveraging what we already know about them — which, when aggregated from across the enterprise, is quite a lot.
A customer’s satisfaction level can be gleaned from customer service and technical support records. Account management and consultant reports will note if an installed system is under-utilized or optimized. In mapping a sales strategy, it’s essential to review all existing service, licensing and/or payment agreements and check whether the account is up-to-date.
Increased knowledge about your customers brings the ability to analyze their next logical purchases, pain points and issues; and identify upselling and cross-selling opportunities. Like any good business partnership, this helps your customers achieve their goals while serving your own.
Adopting this organizational model lends a company greater insight into the power dynamics of a sale. For instance, the sooner C-level executives are brought into the sales process, the higher the revenue potential. When a purchase has the strong backing of the chief executive officer and other high-ranking officers, the company is more likely to commit to a new solution, rather than phasing it in or doing a trial program.
Particularly in industries like technology, top-level support is critical to drive business process change. Therefore, it is important to craft messages for top executives that demonstrate real-world business benefits, such as faster time-to-market and daily access to accurate business intelligence.
With a broader constituency, a customer account also is more stable. When the fate of an account rests on the goodwill of one or two proponents within the company, their departure can be disastrous. However, if the decision-making process has broad support and is based on a shared understanding of the products’ benefits, the partnership usually can survive such a loss.
The organizational view of customers now informs all facets of our marketing at Oracle, and it has led us to rethink many conventional notions about our campaigns. We saw that many individuals at one company work behind-the-scenes, collecting information and contributing to the decision-making process. Yet by analyzing their activities and behaviors as a collective, we learned how that company manages a purchasing cycle.
In response, we’ve broadened our marketing and advertising efforts to address different groups of influencers. In our 2003 “Manage by Facts” national campaign, we targeted executives in different departments, speaking directly to their interests and job responsibilities and building support beyond the CIO and IT manager alone. As a result, we achieved a response rate of over 46 percent across some of our key segments.
As the economy shows promising signs of a recovery, companies will be eager to rejuvenate their budgets and seek new investments in the coming months. Now is the time to rethink sales and marketing strategies to parallel your customers’ decision-making processes and chain of command. As we have experienced, the information to support this model already exists; it’s just a matter of putting an organizational understanding of that information to work.