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Miguel Afonso Gonçalves
– Copywriter e Travel Blogger

Understanding digital in a B2B environment

Introductory Note:

The article I am presenting is inspired by the research developed for my master’s degree thesis, entitled “The channels of communication and marketing in a business-to-business context”, in the context of Communication Sciences – Marketing and Advertising by the Portuguese Catholic University (defended in January 2021, and passed with a final classification of Very Good).

Miguel Afonso Gonçalves
– Copywriter e Travel Blogger

Understanding digital in a B2B environment

Introductory Note:

The article I am presenting is inspired by the research developed for my master’s degree thesis, entitled “The channels of communication and marketing in a business-to-business context”, in the context of Communication Sciences – Marketing and Advertising by the Portuguese Catholic University (defended in January 2021, and passed with a final classification of Very Good).

Digital communication and marketing channels are usually linked to brands that work primarily in the B2C segment, but what impact do they have on the B2B sector? What use do the brands of this sector make of these tools? And what variables lead to a smaller or greater use of digital channels?

There is, however, one certainty at the outset:  the pandemic has allowed the B2B segment to develop a more assertive and instantaneous digital strategy, breaking down barriers that were once thought insurmountable.

To be Business-to-business

This designation has integrated the lexicon of the business world for several decades but has never truly attracted the attention of a majority of marketing theorists. Because it is a segment that is characterized, above all, by the relationship between brands, companies, businesses, institutions, among others, where a formal and conservative environment has developed from an early age, where structural changes are, consequently, time-consuming, and complex. Proof of this is that in 2019, at a time when the digital transition was already a given in the B2C segment, the adoption of different channels in B2B was still something to be talked about and studied (loom.ly/ZKRNw9U).

Business-to-business marketing has been grounded in a more traditional logic, in which proximity, personalization and direct contact are criteria that are indispensable to the strategies outlined and which at first glance seem to be incompatible – or more difficult – factors in the transition to digital.

However, brands and companies live, mainly through people – whether employees, suppliers or customers – so the agents of the B2B sector are also key parts in the development of the B2C segment – business-to-consumer – where strategies and standards are substantially different.  What path is there for this digital transition, knowing beforehand that the logic of relational marketing is central in this segment?

The path to digital

We have always been used to hearing expressions associated with the business universe – understood to be the B2B sector – such as “business meeting”, “business lunch”, “corporate events”, among many others. Unsurprisingly, they all satisfy the three main pillars of communication and business-to-business marketing: proximity, personalization and direct contact which are all common factors. What place do websites, webinars or social networks have and how will they be able to overlap the traditional media in this segment?

Despite having seen a growing global digitization for several decades – particularly since the Internet boom in the 1990s – only in 2020, has the business world been forced to redefine communication and marketing strategies based on an (almost) entirely digital logic, due to the constraints imposed by the pandemic situation.

At this point, different questions arise which we would like to clarify. Are all companies and brands equally susceptible to the full adaptation of these new channels? What criteria of differentiation, or segmentation, can help design more effective strategies? How do you know if digital channels are appropriate for the communication and marketing of your brand in a business-to-business context? And for which customers are digital mechanisms most useful?

Let us start by looking at this issue from a different point of view – one of the main advantages of digital platforms is that they are available to everyone more quickly and instantly, as well as having a lower financial cost.

In theory, any company, or brand, may use these tools within the framework of its B2B communication and marketing strategies. There is, however, a wide range of variables that need to be analyzed in advance to develop an effective digital communication and marketing plan. Which ones?

The B2B market, unlike the B2C segment, is characterized by the survival of brands with fewer customers, but with a higher individual financial value. Turnover between organizations is therefore one of the most relevant variables. But not only. Because it is a segment where change is typically slower, the type – or situation – of buying also varies less often – the purchase tends to be more repetitive, so the processes associated with it will not be more demanding so frequently. Let’s see each of them separately.

Turnover: a key indicator

Before it’s too late to safeguard preconceived ideas, let’s start with a disclaimer: all customers are important to any company, business and brand. But, even unconsciously, they are labeled with varying degrees depending on the financial weight they represent to a company.

In this sense and recalling the three pillars of B2B communication, we realize that traditional channels are more prevalent in communication and marketing strategies with customers who represent higher business volumes. On the other hand, digital channels and strategies help consolidate communication with customers who represent lower billing figures – which, at the outset, in total number of companies will exceed the previous ones.

Purchasing situation

Let us remember that in the business-to-business segment different purchasing situations are identified – whether a whole new purchase type (“new-task”), or  repeated purchases that may or not, have small changes in the face of previous purchases (“straight rebuy” or “modified rebuy”), as indicated by the main theorists of this matter.

As the purchasing decision process in this sector is more complex, calculated, and dynamic, any new purchase requires a closer, personalized and direct contact, so the channels and traditional strategies become more relevant, bridging the difficulties presented by the complexity of the purchase process (as illustrated in the image presented, inspired by the approach of Johnston and Lewin (1996)).

If the purchase, however, is similar to previous ones, not only do the agents know the procedure and requirements, but the process is faster by cancelling several stages of the purchase process. Digital media in these cases have a stage to emerge and contribute to the communication and marketing efforts of B2B organizations.

The world of variables

The table above exposes the wide range of variables capable of influencing organizational purchasing behavior. Subsequently, in each group of differentiating characteristics, there will naturally be occasions to foster the use of digital strategies. One can also say that due to the size of organizations that micro and small enterprises tend to risk and potentially rely more on digital tools – given the lower associated costs – than medium and large enterprises. However, digital always appears as a relevant complement to the so-called traditional strategies.

The geographical component, on the other hand, also influences the strategies applied. Of course, the greater the geographical distance between the companies concerned, the more pressing the use of digital channels will be. And it is at this particular point that the pandemic has proven that in the business-to-business segment there is also space to bet more on digital –the (little) geographical distance is less and less a factor that leads to the mandatory adoption of traditional channels!

gráfico sobre as formas de interação

gráfico sobre a eficácia do novo modelo de vendas

Source: McKinsey

In a recent McKinsey study, we understand that digital increasingly assumes a major role, especially in the next post-pandemic phase, where new reasons for the use of digital come into   question – as is the case with security. The only certainty: at present, is the path is already being trodden.

Reflection 

Talking about communication, marketing or business through digital channels in B2B implies recognizing that there are two distinct eras and that 2020 is the year of transition. Until 2020, the segment, clearly conservative and traditional, was based on a logic of great complementarity between traditional and digital strategies, but where traditional tools – telemarketing, face-to-face meetings, events, among others – still represented the largest share of B2B communication and marketing efforts.

Forced to change the way they act, organizations have adapted to a model – in some cases – 100% digital for months, if not years. Although the figures show that only about a third of companies do not believe in the digital path in this segment, in fact it is necessary to look at all the variables already analyzed (and the other existing ones) and understand that in the business-to-business market, the path will be unequivocally complementary between the two fronts: traditional and digital.

The specificity of the market leads us to understand that each situation must be viewed in a unique way and the choice of the best type of approach based on the characteristics of each company – issuer and recipient!