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Business to Business CRM – overcoming the great sales/marketing divide: part one

4th May 2007
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By Jennifer Kirkby, consulting editor

When the careers advisor says “go into marketing, young man”, few picture business to business (B2B) marketing. B2B marketers have always felt themselves to be the poor relations of their business to consumer (B2C) cousins. And nowhere more so than in CRM. This is particularly ironic considering that CRM started in the late 1980s as B2B relationship marketing; the investment in personal relationship a vital ingredient in what used to be known as 'industrial marketing'.

But the advent of database technology, combined with Peppers and Rogers' revolution in '121' in the early 1990s, hijacked relationship marketing for B2C, resulting in CRM.
It was perhaps also the case that classically-trained marketers being recruited into financial services were more prepared to develop new techniques than their B2B counterparts. Additionally, B2B marketers frequently had to contend with a powerful salesforce for their place in the corporate sun.

But whatever the reason, B2B marketers have long complained about the dearth of case studies, research and support for their particular issues and situations. And so this month we want to concentrate specifically on CRM in the B2B world.

Is B2B CRM really different to B2C?

So just what is the difference between B2B and B2C marketing? Perhaps it can be summed up as relationship knowledge. B2B has a huge reliance on the detailed knowledge of people in an organisation; their roles in decision making, their issues and goals, their market, and their personal attitudes, aspirations and supplier relationships.

This knowledge has to be gathered and distilled to all relevant people in the marketer’s own organisation and supply chain. So in B2B, every customer transaction is an investment in the relationship – a fact well known by the salesforce. Huge contracts have been lost on account of one e-mail (see the Vineet Kalucha interview).

Specifically, the differences are of complexity and degree, which doesn’t negate B2C marketing techniques in B2B, it just means they have to be adapted. B2B marketing characteristics and its related issues include:

• Greater relationship investment is needed at every interaction. "How do we market to senior managers with huge time constraints and gatekeepers?"

• Brand image is bound up in personal relationships, making corporate culture very important. "How do we create a value proposition for international corporates and/or SMEs?"

• Strategy has to be more adaptive to the forces of market networks. Some business customers are end users (eg finance, labour, energy, professional service) and some are part of a supply chain (raw materials, components, services). "How do we find out who supplies who in the market, and the level of relationship? Who do we partner or outsourcer with for enhanced capabilities?"

• There are more complex channels – often through intermediaries, and in alliance with others - but fewer direct retail outlets. "How do we generate leads for customer acquisition in hi-tech markets?"

• A more complex buying ‘unit’ exists, with purchasing processes and political agendas, plus the addition of professional procurement to ensure profitability. It is a myth, however, that the decision making unit (DMU) is less emotionally driven, even with procurement in tow. The ultimate ‘correct’ decision is frequently based on the quality of interaction, however complex the scoring criteria – people buy people. "How do we bring ourselves to the attention of decision makers, users and influencers? How do we market to procurement?"

• It is often a much longer buying process, making acquisition more expensive. "How do we follow through a two year decision making process?"

• Pricing is often based on relationship value. "How should we construct risk and reward contracts?"

• Service is an integral part of the proposition, because of the greater degree of interdependence. "How do we deliver to each decision influencer the right compelling service at exactly the right time?"

• From the very start, the relationship is lubricated by the transfer of and collaboration in knowledge – hence a greater use of techniques such as white papers. B2B product development is often driven by technical progress rather than fashion and trends as in B2C. For the business customer a deeper knowledge of the supplier and their skills reduces risk and so has value. "How do we build strategic relationships with our customers?"

• Yet there is a much lower use in B2B or research and data analytics. "How do we get a better understanding of our customers from all this data?"

• There is much more personal promotion and greater use of face to face, eg account management, trade shows, events. "How do we build key account management techniques? How do we get business people to breakfast seminars?"

Part two, 'From prospecting to customer partnerships', click here.

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