Contact Us
Contact Us

Uncategorised

How should you budget for the right balance for brand and sales activation campaigns when targeting a niche?

Barry Lemon

30 Oct 2023

  Over the years, there have been many B2B marketing studies that changed the industry’s thinking. You’ll be familiar with their headline results but often keen to know more – and to review the original source. This series of articles provides an overview of the research and how they apply for B2B marketers targeting a niche. Not just great, SEO-friendly evergreen content, this is part of our commitment to help marketers in our sectors craft B2B marketing that they are proud of.

Headline finding: LinkedIn Study shows the optimal blend is 46 brand activity:54 sales activation for B2B budget allocation.

There are many myths and laws of marketing. Yet, for most of these, their evidence base is B2C activity. With some activity driving immediate results, and brand building driving longer-term impact, is there an optimal balance for niche B2B marketers? A study by LinkedIn suggests the balance should be 46:54 in favour of sales activation. Research by a LinkedIn-funded think tank, ‘the B2B Institute’, thinks you should. Research led by Les Binet and Peter Field for the Institute has studied some core B2C marketing principles within the B2B market to see if B2B marketing behaves in the same way. Whilst the sample size of B2B case studies used for their research was small (under 50) and spans multiple sizes and categories of business, it would seem to indicate that B2B marketing does behave in a similar way to B2C. As a B2B marketer, the study brings some interesting data-led learnings around marketing effectiveness for our world.

Want to read the original research?

The 5 Principles Of Growth In B2B: https://business.linkedin.com/marketing-solutions/b2b-institute/marketing-as-growth

B2B product growth follows a pattern

The study focused on driving business growth. As B2B niche marketers, this is likely to be a goal at the top of your priority list. But how should you blend brand awareness, sales activation, and loyalty campaigns in order to grow your market share – particularly when high value niche purchases take time to be researched, evaluated, bought and then last for years? The starting point is that, in order to drive growth, both brand and direct response or sales activation marketing is needed. This is based on the Bass Diffusion Model (developed by Frank Bass in 1969) which shows that market growth of a new product is ‘S’ shaped. Starting slowly, then gaining momentum with early adopters who drive word of mouth activity. With a good salesforce and solid pricing strategy, a business can grow on this alone. But, at some point, this ceases to be enough and the initial growth will slow and plateau. This is where brand advertising can help drive further growth. Bass’s research showed that advertising early increases growth rates and maintains sales, and, when the plateau is reached, investing further can help your business grow again.

What are the B2B drivers of growth?

Sitting alongside this principle that brand advertising has a role to play alongside direct sales activation, the B2B Institute research looked at 5 drivers of growth in B2C markets and found that they all to apply to B2B marketing. These were:
  • Brands with a bigger share of voice than their share of market will grow
  • Balance brand advertising and sales activation activity to drive growth
  • Emotional and rational messages drive B2B growth too
  • Maximise the mental availability and fame of your brand
  • Growth is driven by customer acquisition, not loyalty
Looking at this list, some may seem logical, and others more surprising, but how can you use them in B2B? And how should you balance the relationship between brand and sales activation?

Share of Voice correlates to Share of Market

Studies have shown the relationship between share of voice (SOV) and share of market (SOM) where SOV is measured by the total expenditure on brand advertising. Companies with the most growth are those who have Extra SOV, which is where SOV is greater than SOM. In the B2B world, 10% Extra SOV will increase SOM by 0.6%. The Institute’s research indicates that B2B markets behave similarly, with 10% extra SOV increasing SOM by 0.7%. With this as a basic rule, you can calculate roughly what expenditure on advertising you need to invest in order to grow your market share.

A blend of both is needed

Both B2B and B2C marketing needs to move customers through the marketing funnel, starting with brand awareness at the top, and moving to sales activation at the bottom. But how should you split your budget between the two? For B2B, indicators predict a 46% brand and 54% sales activation approach works better – although it must be noted this is a very broad brush statistic based on a small pool of data. Despite this caveat, the importance of blending brand and direct response activity still applies.

Emotional messaging

Within your brand and sales activation activity, there are also indicators that the type of messaging needed is different. Emotional messages drive growth in B2B. Think of the VW adverts from the ‘Working with You’ campaign. These focused not on the features of a VW van, but on who cares about the small business owners, and this increased brand awareness by 30% and led to the highest UK sales and market share for over 60 years. Brand adverts need to ensure that your audience associate your brand with positive emotions and feelings, whilst the sales activation adverts need to focus on the core product offerings and tangible benefits in order to drive the sales conversions.

Brand strength comes from being memorable in B2B, which needs creativity and frequency of marketing

In turn, this leads to the principle of mental availability driving business growth. This is a term which simply means that your brand needs to be memorable. Not necessarily different. Research has shown that familiarity with a brand will increase the likelihood of both clicking on an advert or purchasing the product. Keeping your brand activity live all year round – or frequently during a year – is critical to ensuring you drive that mental availability. Planning B2B Marketing that is effective is not easy. We work with technology, industrial and professional services companies on exactly this. Every day. Learn more about how we do this with our B2B services here.

Barry Lemon

We’re niche by choice. Just like you.
You’re in the right place.

Meet our team of specialists Learn from our learnings Get in touch with us