I talked to dozens of CEOs and marketing leaders over the past two years.
And there is one fallacy that I encounter repeatedly.
Most organizations unconsciously set up their marketing operations as if everyone who is a potential customer is also ready to buy — if we only convince them enough.
Many B2B marketers seem to think that marketing works through persuasion, ‘pushing’ buyers down a funnel by explaining the product benefits.
But especially in B2B and for more expensive purchases in general, this is simply not the case.
For example: Alexandra, while a big Tesla fan, won't buy a Model S in the next couple of years because she bought herself a used Chevy just 18 months ago. She might one day, but not right now. No matter how much you try to persuade her.
Another example: Frank reads a ton of blog posts from HubSpot and totally buys into their inbound marketing philosophy. However, his company currently uses a different marketing automation software that over the years has been entangled into many other systems used by finance and sales. He might like to switch to HubSpot at some point, but that actual purchase is years out.
There are only so many people currently ready to buy
Even if we are generous and say 15% of people are ready to buy from you right now or have the intent to do so in the next couple of months, it does not justify that 90% of your budget goes to performance marketing trying to convert strangers to customers.
But that is the reality in most marketing departments today. Performance marketing aka "online sales" rules the world, because you can directly attribute how much you spend to generate a certain amount of leads (even if those leads show no buying-intent for years to come). And those leads with no intent to buy anything from you will then be "nurtured" with annoying product messaging that has no relevancy to the situation they are in.
So what can we do instead?
What makes much more sense, is to set up a performance marketing system that captures the existing demand through paid search, review sites etc. and optimize the conversion rates on your websites that lead up to a purchase or sign-up.
Once that system is in place however, we switch gear and focus on the 95% of buyers that are out-of-market.
Effective marketing increases future sales in future buying situations. How? By increasing the probability that the brand comes to mind when the buyer goes in-market. Simply put, the brand that gets remembered is the brand that gets bought. You can’t push buyers down a funnel, but you can, to quote Professor Jenni Romaniuk, “catch buyers as they fall”.
This is similar to how Les Binet and Peter Field’s 60:40 rule states that the optimum marketing effectiveness is reached with a mix of 60% for brand building and 40% for activation of buyers. So to summarize these two trends, the marketing team should stop forcing all potential customers down a buyer-funnel and instead:
- Expect sales results mostly in the long-term, not in the short-term.
- Develop creative that will be remembered mostly by future buyers, not current buyers.
- Maximize reach mostly against out-of-market buyers, not in-market buyers.