The Increasing Importance of Building B2B Brands in the Digital Era
Much has been said and written about shifting paradigms in the world of B2C brands in markets increasingly powered by the Internet, social media and e-commerce.
Further over the past couple of years as AI has emerged from the labs into everyday word, B2C marketers are prognosticating its effect and in some cases already bracing for it.
What about B2B marketing?
At one level B2B sales and purchase processes are much more rational and granular than decision-making in the B2C context.
B2B sellers must work almost on a case-to-case basis to optimize prices, meet specifications, comply with regulations and follow ethical practices.
B2B buyers, again on almost a case-to-case basis, must rigorously evaluate vendors, run total cost-of-ownership models while developing and applying quantifiable criteria to find the sweet spot on the price-performance curve.
Beyond the rational process however , subjective and emotional factors do play an important but secondary role.
In the Industrial Age the rationale evaluation process was drawn out and lubricated by many across-the-table meetings. This lead to development of human-to-human relationships between buyers and sellers and these relationships provided the subjective and emotional context to B2B selling and buying.
In such a scenario for most B2B transactions brand equity of the B2B seller played a secondary role in the decision-making process. Except in some exceptional cases. For example the brand equity of IBM in the early days of computing was seen by purchase decision makers as a sure and universal hedge against blame!
With the coming of the digital age and its concomitant communication and computing revolution the rationale part of the B2B selling and buying process has become simpler, faster and in many cases automated.
Combined with the increasing complexity of the business and industrial world this has led to a much lower frequency and intensity of human-to-human interaction in most B2B selling and buying processes.
Given this the onus on brand equity to supply the emotional ballast in swinging a B2B purchase decision increases in importance.
Eric Almquist, Jamie Cleghorn and Lori Sheres of Bain & Company in an HBR article titled “The B2B Elements of Value Pyramid” identify five hierarchical value sets driving B2B transactions. Starting from the bottom they are:
- Table Stakes
- Functional Value
- Ease of Doing Business Value
- Individual Value and
- Inspirational Value
Systems selling driven by intra-company and inter-company communication and computing platforms and other digital assets are increasingly the principle means of selling and delivering the three base value sets of Table Stakes, Functional Value and Ease of Doing Business Value.
Given that context it is my belief that B2B brand equity has to be principally developed on the two value sets that are at the apex of the value pyramid — Individual Value and Inspirational Value.
Needless to say that any initiative to develop a brand equity on these higher order values without making sure that the organization substantially delivers on the three base values would be counterproductive and lead to a teetering, unstable pyramid.
Let’s examine the two higher order value sets for insights into efficient and effective B2B brand-building.
In the Bain pyramid the Individual Values set has two sub-sets:
Under the Personal sub-set the four specific values identified are:
- Design & Aesthetics
- Growth & Development
- Reduced Anxiety
- Fun & Perks
Design & Aesthetics is a classical area of branding. It is an exercise between optimizing for wide spread appeal and a distinctive personality in consonance with the brand’s positioning.
The other three values — Growth & Development, Reduced Anxiety, Fun & Perks — are driven by increasing the interface between individuals in the purchase decision making process and the brand. The brand has to be careful in doing so mindful of the risk of transgressing legal and personal boundaries.
One creative and safe way to do that is for the brand to create exclusive online and digital assets that engage individuals in rewarding ways. In an area of increasingly crowded field of options vying for an individual’s attention this is easier said than done.
Under the Career sub-set the three specific values are:
- Network Expansion
- Reputational Assurance
I believe that delivery on the values of Marketability and Reputational Assurance is linked to excellence in the base value sets of Functional Value and Ease of Doing Business Value combined with efficient communication of this excellence.
The value of Network Expansion can be delivered through an active on-the-ground program of hosting offline and online events and talkfests.
The true domain of B2B brand-building in the digital age I believe lies in the value set that is highest in the hierarchy — Purpose.
The specific values listed under Purpose are:
- Social Responsibility
At issue we must remember is that of B2B brand-building. How does one business convince another that it offers a vision of and hope for a better future and is socially responsible?
To my mind when it comes to these highest set of values a B2B brand is essentially addressing individuals — people in decision making roles in the other businesses be it clients, customers or associates, individuals in regulatory bodies and the media. And importantly individuals in talent pools that are critical to the B2B business.
In the digital era we have seen giants like Apple, Amazon, Google and Facebook emerge as strong brands not just in the B2C arena but among other businesses, the media, regulatory bodies and most importantly individuals in talent pools key to their success.
Core to the success of these brands were larger-than-life entrepreneurs articulating larger-than-life visions.
Over the past couple of years however these strong brands are seeing a precipitous fall in their brand equity as the world begins to perceive them as not just coming short on Hope and Social Responsibility but actually as power-hungry villains.
The question is how does a B2B brand safely build its equity on the values of Vision, Hope and Social Responsibility? Well there is a magic formula.
Just be it! Strive to actually offer vision and hope and be socially responsible!!
Last week (3rd week of August 2019) a group of 180 corporate bosses in the US including the chiefs of Walmart and JP Morgan Chase declared that maximizing shareholder was no longer their primary goal and that instead serving customers, staff, suppliers and communities takes primacy!
However, mere words or declarations of intent will not stave away the scrutiny of the young across the world who are increasingly concerned with rising income inequality, the threat of climate change and the increasing economic heft of oligopolies and cartels.
To summarize here are the two key points when it comes to B2B brands in the digital era:
For B2B brands to create and sustain competitive advantage in the digital era there is an increasing need o build themselves on the higher order values of Vision, Hope and Social Responsibility.
And in a world where the means of deep scrutiny are widely available and with a generation that is increasingly critical of the rapaciousness of big business it is no longer possible to get away by merely professing these values through clever advertising and PR spin. One must actually offer real hope for and a vision of a better future and actually be socially responsible even, if need be, at the cost of short-term profitability.
It is my hope that the above double-edged challenge will over the next couple of decades drive businesses to lead socio-economic reform that enables the world to successfully combat the rising ills of inequality, climate change and monopolistic rapaciousness.