by Julie Schwartz, ITSMA
B2B services marketers appear to have gotten the memo. Their marketing priorities and budgets are shifting as they try to keep pace with changing buyer behavior. But that doesn’t mean the lag has totally disappeared. For a variety of reasons, marketing budgets are always slow to change. Unfortunately, not every marketer has given up on those hard copy brochures (you know who you are!). Still, I was very impressed with the changes marketers are making to their 2013 programs and strategies.
Budget Inflows and Outflows
According to the B2B consulting and technology services marketers who participated in the 2013 ITSMA Budget and Trends Survey, budget is flowing into:
- Demand generation and lead management
- Content development
- Brand and communications
- Sales (channel) enablement and support
Given the changes in how buyers buy, these budget movements make sense. The top marketing priority is thought leadership content development and dissemination to drive revenue. However, this group of marketers doesn’t report decreasing spending in any areas. That can only mean that marketing budgets are growing. And in fact, B2B services marketing budgets are on the rise.
B2B Services Marketing Budgets Are Growing
One out of every two marketing organizations report an increase in the 2013 budget, and that increase is significant—on average 17%. The average B2B services marketing budget is 1.5% of revenue and holding steady as revenue grows 12%. (Historically, ITSMA members grow faster than the market. The growth reported by ITSMA members is typically 2 to 3 times what the industry analysts forecast—membership has its advantages!)
Pipeline Acceleration Trumps Lead Generation
The nuance around demand generation and lead management is interesting. Marketers are modifying their priorities from lead generation to pipeline progression. The focus is no longer on filling the pipeline. Instead marketers are emphasizing pipeline progression—collaborating with sales to move sales accepted leads through the pipeline. 2/3 of marketers are increasing their spending on pipeline progression. Marketing recognizes that it needs to work with and support sales to build ongoing dialog and strengthen relationships. Generating leads is not enough. Marketing also needs to contribute to revenue.
The Digital Marketing Revolution
The most dramatic changes we see in the marketing budget are in the delivery channels and formats marketers are using to communicate with buyers and influencers. Marketers today now have to reach two very different types of buyers: the B2B Social Buyer and the Traditional Buyer.
- Traditional Buyers prefer face-to-face events and meetings
- Social Buyers are plugged into social media networks and communities
- Both types of buyers rely on solution provider websites & SEO, solution provider subject matter experts (SMEs), and even sales calls and private briefings
75% of B2B marketers are increasing their digital marketing budgets. In particular, they are pouring money into:
- The corporate website
- Search engine optimization (SEO)
- Public online communities
- Email, email newsletters
- Online video
Despite the impressive inflow of budget and resources, the B2B services digital marketing budget is but a pittance of the overall marketing budget—only 4.7%.
B2B services marketers are also increasing their spending on direct marketing (email and snail mail) and private events, seminars and conferences. When it comes to the marketing mix, budgets are actually constrained. Doing more of some things means doing less of others. What are marketers dropping? No surprises here: public trade shows, sponsorships, and traditional advertising.
Account Based Marketing is Hot, Hot, Hot!
Account Based Marketing (ABM), also known as key account marketing, is on fire! B2B services marketers who practice ABM are planning to double their ABM budgets in 2013.
Why? Because Account Based Marketing works. Buyers want to work with companies who know them and understand business issues, and therefore can bring them innovative solutions.
Members of ITSMA’s ABM Council can attest to how ABM has helped them broaden and strengthen their account relationships, bring greater business value to their key accounts, increase awareness and demand for their services and solutions, and ultimately sell more.
How are you changing your marketing priorities and budgets in response to changing buyer behavior?