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Our POV: Digital transformation affects not only B2B buyer journeys, but also many B2B industries’ fundamental business models. As a result, it’s more important than ever that companies invest in B2B branding that complements the newly digitized customer experience and clarifies their transformed corporate story.
Digital transformation has as many definitions as it does practitioners. At its core, it’s the use of new, fast and frequently changing digital technology to solve problems. Cloud computing and mobile communications are two examples of transformative technologies that are having a profound impact on all segments of our economy. Because B2B industries are no less impacted by digital transformation than their B2C counterparts, B2B companies need to take a fresh look at their brands and marketing strategies to ensure that they are still relevant in a digitally transformed world.
B2B branding: Five challenges raised by digital transformation
Continuing as usual doesn’t cut it for technology, so why would it cut it for branding? B2B brands must overcome these five challenges posed by digital transformation as they reconsider how to build differentiation, equity, and loyalty.
1. Increased choice
While established players play technological catch-up, software-powered start-ups have been able to steal market share and become major vendors themselves. Think of project management start-ups like Workfront, which has received $375 million in funding in 2018 alone. While optimizing project management may have once been the purview of consulting giants, a host of software platforms are now competing with traditional players for this slice of the market. We find this across industries: a large number of our enterprise clients bemoan the threat of agile, B2B software start-ups who always seem to be nipping at their heels.
With increased competition, B2B branding can’t rely on pricing or specs — particularly when many legacy players can’t meet start-up pricing. For B2B industries experiencing digital transformation, whether carving out new space or fending off new challengers, a compelling brand story is a must.
If your market segment is being disrupted by digital transformation, which is exposing your long-term client base to a new range of choices, it’s vital to identify what enduring strengths you can communicate to withstand threats. Is it your people? Your culture? Your industry expertise? In a digital world, sometimes it’s the “analog” assets that can give you a competitive advantage.
2. Changing buyer behavior
As digital changes have broadened competitive sets, so too have they empowered smarter buyers. B2B buyers now report that, of the time they spent during a journey to purchase, 27 percent was devoted to independent online research. This means B2B brands aren’t always telling their own stories. Prospective buyers are reading analyst reports, third-party reviews, and news stories. This is precisely why brand is so important: your positive equity must outweigh any negative messaging beyond your control.
B2B buyers want to research independently and they want to do so quickly. AI, automation, and machine learning are becoming more and more popular in the B2B buying process. Some examples include chatbots, product recommendation quizzes, and cost calculators. In today’s marketplaces, a human may not be the first, second, third, or even tenth point of contact for your B2B brand. In fact, research from American Express shows that millennial business buyers are more willing than previous generations to buy a product without ever speaking to a salesperson.
With a significant percentage of a prospective buyer’s research time spent outside platforms you can control, it’s important to optimize the space you do control — as well as work actively to build good relationships with industry commentators. Make sure that you optimize every opportunity you have to tell your story without mediation. Ensure that your website’s copy reflects your brand. This means developing your brand voice, tailoring messages for core audiences, and creating compelling multimodal content such as videos, white papers, and infographics.
However, companies must also acknowledge that their reputation is shaped by actors beyond their control. Thus, B2B brand marketers must also build productive relationships with third parties, such as analysts, journalists, and industry experts. The result — positive media coverage and opportunities to collaborate on research or industry thought pieces — will help bolster the claims you make about your own strengths and expertise.
Brand-infused messaging, thought leadership, and media placements will go a long way to building much-needed equity in your brand name. However, as important as human recognition is to B2B branding, our digital era also demands we build equity among machines. Your brand needs to stand for something, but it also needs to show up at the top of search results!
Until recently, SEO and SEM haven’t frequently been thought of through the lens of brand. But as our audiences become algorithmic as well as human, it’s important to consider how your messaging, content, and web design can boost your page rankings without compromising your brand’s voice or values. Which keywords would you like to be associated with? Which would you not? What pages do you want your results directing to? When you provide value before and after a click, you improve both search results and the company’s reputation.
3. Higher B2B customer expectations
All B2B buyers are getting savvier, but as millennials take on leadership roles and Gen Z enters the workforce, customer expectations will change dramatically. Both groups are driven by convenience; according to American Express, 70 percent of millennial business buyers indicate they expect an “Amazon-like” experience from B2B brands. They’re also drawn to companies aligned to their values. A 2017 study by Merit found that 80% of millennial business buyers say that the environmental, social and philanthropic efforts of potential vendors are important factors in their consideration.
It might seem like a paradox: customers — particularly millennials — want the speed and personalization that come with automation and AI, but they also want to work with and for companies that seem “authentic” and “human.” It’s a tricky balancing act: how can your B2B branding project humanity…without any human contact? There is a growing suspicion of the data collection and analysis that allows companies to automate operations and personalize offerings. Companies must find a way to recognize the skills and personalities of their employees, as well as the tangible benefits their products bring real people. In a recent brand campaign, B2B digital transformation consultant EXL did just this, staking it’s claim around “Digital Intelligence,” a unique combination of human ingenuity and machine intelligence.
4. Emerging online marketplaces
Although still in their infancy for B2B brands, online marketplaces are likely to become major selling platforms for many B2B brands. In fact, in 2018, Gartner predicted that by 2022, 75 percent of “tail spend” (non-strategic items) will be purchased through online marketplaces such as Amazon for Business or Alibaba. McKinsey predicts that B2B online marketplaces will expand beyond non-strategic products, however. It foresees online:
- time-and-materials marketplaces (freight, travel, IT, etc)
- scope-of-work marketplaces (marketing, telecom, utilities, etc),
- corporate spin-off marketplaces (the formerly captive supply networks of large companies).
While online marketplaces may present an opportunity for B2B brands to sell in greater volumes, they do present potential challenges for maintaining equity in the marketplace. By selling products on another company’s site, brands relinquish control over a large portion of their customers’ experience. Marketers will have to reckon with many thorny problems: How to tailor messaging for online marketplaces? How to best use imagery and design within limited space? How to shield brand reputation from the risk inherent in a partnership? Most importantly, how to make sure equity is built around the product or solution brand, rather than the online marketplace?
5. Fundamental business shifts
The most evident B2B branding challenge posed by digital transformation may also be the most daunting: as technology fundamentally shifts companies’ business models and offerings, so too does it shift brands’ points of differentiation and marketing imperatives. For example, DeSantis Breindel worked with a major employment law firm that had begun to derive a large portion of its revenue from software solutions. While this firm had been comfortable with professional services marketing, it was out of its depth when it came to technology product marketing. What’s more, it wasn’t sure how to incorporate messaging about its software solutions into its overall brand positioning.
Cases like this are becoming more frequent. Even companies accustomed to technology product marketing must pivot as software platforms or cloud solutions further disrupt industries. The takeaway is clear: major changes in business may require major changes in branding. However, because change is incremental, often the need isn’t apparent until a B2B brand’s messaging and product portfolio are already a mess — or worse, at odds. To avoid this scenario, companies must consider each strategic shift’s implications for the brand and be willing to devote the resources necessary to evolve it at the same pace as technological innovation.
B2B branding: don’t get left behind
B2B brands experiencing digital transformation have a lot on their plates. From major technological expenditures and implementations to painful decisions about restructuring and staffing, marketing may get bumped down to a secondary priority. However, inflections points are exactly the time that brand can have the most positive effect: clarifying offerings, inspiring employees, and exciting customers. Branding B2B digital transformation brings unique challenges, however. In addition to requiring a second look at purpose and differentiation, it also demands marketers reckon with new platforms and audiences — some of which are nonhuman! If digital transformation has taught corporations anything, it’s that failure to react to innovation will only lead to a later scramble to catch up. The same goes with B2B branding: future-proof now to ease transitions and maintain equity later.
To learn more about B2B digital transformation, contact us.
