If you were to guess the top challenges facing B2B companies in the current market, you would likely guess scenarios such as revenue, competition or acquiring talent. Though these are all important challenges that the typical Business-to-Business brand is dealing with, you’d be surprised that they are not the biggest issues that are raising concern. The current business, marketing and technology climate is driving new concerns for B2B marketers that are likely to continue for some time.
According to a recent report published by eMarketer, B2B International has surveyed hundreds of US and European B2B brands from various industries in order to determine their top concerns. The research points to building market share and innovation as the top two challenges facing B2B brands, followed by retaining customers and/or customer loyalty.
Though a bit surprising to be the top challenges facing B2B marketers, it is interesting to note that the focus of business brands are beginning to mirror those of many B2C focused companies. This trend is likely to continue given the expanded role content marketing, social media and social selling are playing and the growth of their consumption by end users that traditionally have been less connected online.
Top B2B Challenges Demystified
In researching this post, there were several things that came to mind regarding the top challenges that surfaced through this recent study. If you are a B2B brand facing the significant challenges that are detailed in this research, I hope you will find these thoughts interesting and enable you and your team to be more effective at squashing them within your organization.
Building B2B Market Share
Growing market share for your B2B brand has become the top challenge B2B brands state they are facing today. In fact 62% of the B2B brands surveyed stated that building market share is their number one business concern. But it is important to note that growing market share does not necessarily have a direct correlation to growing revenue.
Though growth in market share often is connected to growth of revenue, that is not always the case. Since B2B market share is related to the percentage of the overall market that it is doing business with, rather than a direct measurement of revenue from sales. Meaning that your B2B market share reflects your percentage share of the specific market you currently sell to, leaving revenue as a separate metric measurement.
Just as with sales and revenue growth, market share penetration for B2B brands consists of selling. The focus of the market share growth is usually highly targeted to a specific market segment and not combined growth of sales over all products, services and customer types. The idea is to increase the percentage of the overall market that you do business with.
For B2B brands to make significant inroads into their market share expansion, they need to have very specific tactics, goals and plans in place. More importantly, B2B marketers should first be deploying time and resources toward research that provides deep insight into their market, the customers they are trying to capture market share through and the obstacles that are present within this focus.
Without deeply understanding these things prior to making your plan of attack, man B2B brands will create more challenges for themselves as they attempt to increase their market share. You must know what you don’t know and also validate what you think you know about your market before proceeding. This is often overlooked by startup and mid-sized B2B brands, making competing with larger enterprise business brands much more difficult.
B2B Innovation
In a highly competitive B2B space, innovation is crucial to your business success and therefore it is no surprise that 59% of B2B marketers are stating it as their second most significant business challenge. Innovation within an organization is typically focused within three specific areas, all of which require data, talent and resources to make a large disruptive change.
Product Innovation – For B2B brands to really develop new, innovative products and services they must rely on data. Understanding the state of customer needs and current product availability within your market segments is crucial to developing groundbreaking innovative technologies and products. Furthermore, product innovation within your B2B company requires that you also have an understanding of what the future holds for your customer, industry and technology advancements that exist on the horizon.
Being effective at product innovation requires B2B brands to have leadership that is hyper focused on disrupting current markets and have the vision and experience to see beyond today and tomorrow, and most importantly well into the future.
Operational Innovation –
Many organizations can become stagnant internally. Sometimes this has been caused by rapid growth and the required bureaucracy put in place to set up controls and protection for the company. Other times a company becomes stagnant operationally because they lack needed talent and leadership. Regardless of the operational standoff, B2B brands need to focus on breaking strongholds that have developed within their organization that ultimately affect their ability to make decisions, changes and innovate other parts of the company.
B2B brands should look to their existing staff to uncover strategic and operational processes that need change and disruption. Management needs to create a culture of innovation internally that listens to the boots on the ground and takes decisive action on the valid suggestions team members make that can innovate your company from the inside out.
Marketing Innovation –
No matter how innovative your B2B product or service is, or how innovative your internal infrastructure, processes and procedures are, if you are not innovating your B2B marketing, you are at risk.
B2B brands need to better innovate their marketing in ways that disrupt the status quo and provide prospects and customers with what they need. Brands need to spend the time researching their prospects to better understand their needs and the messaging, platforms and methods that connect with them the most.
Finally, B2B companies need to push the envelope of their marketing away from old, stodgy marketing and toward a fresh, new and innovative style that stands out from their competition. Know what your competition is doing well and where their marketing has holes and focus on out innovating them where they are weak and matching them where their B2B marketing is stronger.
Retaining Your B2B Customers
One of the areas that many B2B brands fail is in customer retention and loyalty. They spend tons of money and resources on sales and marketing, yet waste it all by not ensuring long-term relationships with their newly acquired customers.
I can’t emphasize enough how important building customer loyalty and retention efforts are for a B2B brands success. It is no surprise that this is considered to be the third biggest challenge facing B2B marketers today. Customer retention that staves off attrition and revenue declines is an investment that will pay dividends over the long-term, when implemented properly.
If your B2B company is seeing an increase in attrition, or are currently running a higher attrition rate with your customers, you need to take heed. Invest the time, expertise and resources that are required to strategize and implement a combination of sophisticated automated and manual systems to make your customer retention and customer loyalty results innovative and effective.
To be clear, none of these three top challenges are easy or inexpensive obstacles for the typical B2B company to take on. However, since they are the top issues, B2B brands should run not walk toward establishing data driven solutions that will chip away at the problems rapidly, yet with a long-term focus of improvement.