B2B Digital Transformation - marketing's gaping void

Ed Marsh | Oct 21, 2013
This is the first in a two-part article. Today we’ll try to tease important insights from recent research, and tomorrow we’ll explore how those insights can be applied to B2B marketing challenges for SMB manufacturers.

Re digital evolution….“There is too much hype. I can’t push harder because of all the hype and the overselling from suppliers. I lose my credibility if I push it too hard. So we take a slower approach just to make sure we don’t give the naysayers their way.” says one CEO (quoted from the MIT Sloan Management Review article cited below)

“Call me a relic, call me whatcha will”

Conversations about B2B marketing with senior executives, particularly manufacturing folks, have several common themes.
  1. “We need to change our business development strategies and tactics. It’s getting harder to find new customers. The traditional methods aren’t as effective as they used to be.” 
  2. “I’ve had lot’s of experts, who all speak in jargon, promise huge results with the internet. It’s always ‘you’re missing the key piece’! But none of it has worked.”
  3. “I’m not convinced any of the ‘experts’ really know what they’re talking about. We’ve built a company; we’re smart enough to figure this out ourselves. And frankly, we probably understand what needs to be done as well as they do.”
It’s really uncanny how so many unrelated conversations with executives at various size companies across diverse industries follow the same pattern. Clearly there’s a common experience and shared skepticism of B2B internet marketing.

Today’s new marketing “rock and roll” hasn’t convinced many in the manufacturing world. And as this recent Adobe ad illustrates, one can empathize.


Three studies say they’re right AND they’re wrong

As the fall marketing conference season winds down, the reports, studies and surveys are flying like the leaves here in New England. There’s no shortage of hyperbole and grandiosity. But there’s also some fascinating research that confirms the gut feeling of all those skeptical executives with whom I speak– AND it simultaneously refutes their conclusion.

Embracing Digital Technology: A New Strategic Imperative - is an MIT Sloan Management Review look at enterprise wide adoption of digital technology and the risk of competitive obsolescence. It focuses on organizational risks of, requirements for, and obstacles and avenues to adoption of digital technologies. It isn’t focused solely on marketing, but to the extent that marketing is increasingly digital, many of the insights apply.

Digital Distress: What Keeps Marketers Up at Night – reports research conducted by Adobe in conjunction with Advertising Week. As one might expect it’s somewhat less strategic in scope than the Sloan study. Rather it’s a series of data points presented in attractive graphs and illustrations. But, wow! Some of those data points are telling!

Marketing2020 – a study prepared by the Association of National Advertisers, World Federation of Advertisers & EffectiveBrands, with Forbes partnership, looks at organizational structures that will generate successful marketing in coming years. (read more from @jenny_rooney)
b2b internet marketing
Several themes are consistent across the three studies:
  1. Marketing is changing – regardless of whether that change is welcome
  2. The marketers are as confused as anybody else (and skeptical of each other and their companies)
  3. The role of marketing is changing (and ‘advertising’ is increasingly a vestige of days of yore)
  4. Success will require competitive advantage which is increasingly conferred through foresightful digital strategy and relentless execution 

Sampling of key points

The more things change, the more they...change

  • “IT and digital is pervasive in people’s lives now. So the advice I would give someone starting it now is, think of yourself like a consumer technology company.” Curt Garner, CIO Starbucks
  • 2/3 of marketers say that the practice of marketing has changed more in the last 2 years than in the last 50!
  • Companies face a “digital imperative” to adopt new technologies effectively or face competitive obsolescence…yet leaders often lack urgency
  • 65% of companies won’t succeed (survive) without digital marketing
  • “today’s emerging technologies, like social media, mobile, analytics and embedded devices, demand different mindsets and skill sets than previous waves of transformative technology.”
  • only 18% believe their companies will increase competitiveness when leadership is not focused on digital
  • “almost no organization is sheltered from the competitive disruption wrought by the widespread adoption of digital technologies…they must succeed in creating transformation through technology, or they’ll face destruction at the hands of their competitors that do”
  • >50% say digital marketing is evolving through ‘trial & error’ – you might be ok with the trial part, but the error?
  • 65% think digital transformation needs to be more important to the CEO’s agenda than it currently is
  • “Inertia and complacency are deadly in the world that we live in today”
  • Content and digital marketing are now the two key drivers of biz dev success
  • “Digital” is a mindset that drives how to work internally and how to relate to prospects and customers
  • myths slow adoption – such as “the belief that digital technologies are not that effective yet in our marketplace” and “The organization has a long history of success…the need to change is not clear to some members of the old guard.”
  • “(digitally immature) companies’ probably use email, internet and various kinds of enterprise software. But they have been slow to adopt or are skeptical of, more advanced digital technologies like social media and analytics.”
  • Aside from reaching customers, simply understanding what works, proving effectiveness and measuring ROI are now marketing imperatives 

Inmates running the asylum

  • < ½ of marketers are proficient in digital marketing (has anyone among all those experts fessed up to you that they aren’t?)
  • 82% of marketers have learned digital as they go, on the job – there’s no way to discern competence through formal credentials
  • perception of urgency of digital transformation is vastly different between CXOs and boards (who think pace of change is right or too fast) and employees (who feel it is too slow)
  • only 9% agree strongly that their digital marketing is working
  • only 40% find their colleagues capable of meeting today’s marketing challenges
  • internal marketing decision makers acknowledge that they turn to those same colleagues (in only 40% of whom they have confidence) for decision support
  • “’There are two wrong ways to approach (digital transformation), MIT’s George Westerman (said) ‘One is to say, ‘just go off and do something. And we don’t need to worry about coordination.’ Another is to hire a bunch of people and say ‘make this happen. I don’t need to be involved.’”

Marketing rules the boardroom...almost

  • Silos (strategy, PR, market research, events, etc.) will finally disappear and an integrated organization will emerge
  • Evidencing the ascent of marketing, the new role of “Chief Experience Officer” will be filled by either CEOs or CMOs
  • IT, HR and other responsibilities will increasingly be shared by marketing
  • Engineers are now filling marketing roles

Strategy AND execution

  • Only 38% believe digital transformation was a permanent fixture on their CEO’s agenda (62% are just floating? Or not articulating the strategy?)
  • Think, Feel & Do (analytics, engagement & execution) approach will require actionable strategy – or as Aman Govil, the engineer who heads Google’s advertising arts team recently described it, “Art, Copy & Code”
  • There are internal benefits too – “respondents said internal communications are sharply improved, especially through using social media.”
  • Only 40% of marketers think their company does digital well
  • KPIs and ROI are a hurdle because “companies have trouble defining how to successfully define KPIs, lack of management skills to carry through on KPIs, and needing cultural changes to make KPIs work”
  • 70% are struggling to show an ROI for their marketing spend
  • there’s a huge gap between business need and actual performance in key areas of measurement, content & creativity
  • a clear correlation exists between effective digital marketing and high performance (growth & revenue)
  • using digital to reach untapped opportunities through targeting is broadly valued and poorly executed
  • “’the vexing thing about innovation and disruption is, they don’t stop once you do it.’ Neither will competitors.” 
As the MIT Sloan Management Review article concludes, “The only wrong move for executives, then, would be not making any move.”

And tomorrow we’ll take a look at how this data (any of it resonating with you?) should impact the way you approach the challenges.