Why Branding Doesn’t Work on B2B Customers

JOHN-WANAMAKER

I’m not a believer in branding being a primary driver of B2B success, which surprises most people, given that my business is all about marketing. But when it comes to closing a B2B deal, I don’t see any hard evidence that branding alone will convince a customer to buy. It is often even questioned in B2C markets, as John Wanamaker (founder of Wanamaker’s department stores) used to say, “Half the money I spend on advertising is wasted. The trouble is, I don’t know which half.”

Of course, branding has its place — particularly for business-to-consumer (B2C) markets. That’s because consumer branding often involves convincing people of things that aren’t necessarily true. B2C marketing efforts are frequently driven by such irrational factors as image, self-satisfaction, fashion, the need to be cool, sex appeal, etc. That’s why consumer marketing generally lives and dies by advertising. Very few consumer products or services can survive without it. Consumer ads, promotions and other image projections often establish the product’s value and create the demand for it.

The B2B world, by contrast, is rooted in the rational. Branding that appeals to irrational or perceived needs just isn’t going to work, because in the end businesses will not buy nor continue to buy things that don’t actually help their business. Marketing your business products and services to business customers demands a different way of seeing the relationship between your product and the prospect, including the hierarchy of benefits — real and perceived.

That’s why we in B2B marketing must rely on a more fundamental tool: compelling business value. The value that you create for a customer is your best asset for appealing to the B2B customer, because the B2B customer believes in facts (aka, verifiable financial proof in the form of ROI).

The task for B2B marketers is to understand what constitutes value for their customer and to create a truly compelling value proposition that a prospective customer will recognize and respond to. The value proposition must be relevant to their actual needs, and expressed clearly and directly. And it must position your offering against your competitors’ in terms of business value, and not features, flashy advertising, or other factors subject to rapid oblivion. Go for substance. If you’ve got numbers, use them. Leave trying to convince people that they will be more attractive if they buy your product to automobile advertising.

Once you have a compelling value proposition, stick with it. Continue to prove it and strengthen it. If it rings true, make it ring louder, make it ring for a wider audience. Even if you get tired of hearing it, your target audience won’t.

In B2B, a brand is built by delivering on the actual value behind your value proposition. Staying true to the promise is really what creates a B2B brand and sustains it as fleeting trends come and go. There’s no better way to increase return on your marketing investment. In the end in B2B, advertising won’t help you create your brand. Once a brand is established, you can advertise to promote it, but a B2B brand is born from your product or service.

What are your thoughts about building a B2B brand? Post your comments below.

16 thoughts on “Why Branding Doesn’t Work on B2B Customers

  1. Very Intriguing and Very Interesting: about Branding and the B2B vs B2C angle.
    However, I think like a business too…and if I have a Bugatti or a Maserati, I don’t need a Lovely Woman to stand in front of it or even near it…I just want the Car…Period!

  2. I pretty much agree with you Darrin; but what qualifies “success?” How much money does a company have to make to be considered “successful?” Unless they have captured 100% of a market, there is room to become more successful.

    Not only that: but I know of many cases where an established industrial brand’s product continues to be purchased despite the fact that there is a better alternative. Better = better delivery times; better servicing of the product after the sale; more reliable; more innovative technology. Branding plays into this, as well as human feelings and emotions.

    A brand strategy may not be AS important in the B2B industrial world, but it definitely has its place and in my opinion, along with a strong product or service, can help to grow a MORE successful company.

  3. Darrin, I agree, up to a point. I do think that brands can play a more significant role in the success of industrial brands than ever before, if applied properly. Allow me to explain.

    With the pervasiveness of the web, social media, integrated marketing software, changing search algorithms, etc. etc. … a strong brand statement and theme can mean the difference between being picked rather than your competitor.
    I agree with you the brand needs to be backed up by real data and accurate product information. The industrial brand also needs to be rooted in the core values of the industrial company. The brand theme is not flashy or sexy…it is based on the customer’s emotional after taste after they have had a positive experience with an industrial product or service.

    Once the brand theme is developed then that strong theme can be woven into the entire marketing mix including all the new content that is now required by Google and others. This makes the task of content marketing, inbound marketing…whatever you want to call it, much easier.

    Just a couple quick examples of great industrial branding:

    We are working with a specialty, precision CNC manufacturer. After talking with employees, management and many customers we soon realized that our customer was not just another CNC manufacturer. Many of their parts were used in critical medical applications. Also much of their work is devoted to critical aircraft parts. A .0001 mistake can mean an F-18 falls from the sky.

    With strong data and real-world applications we deployed a new brand statement and theme, “Life-saving Precision”. This brand theme will weave itself through newsletters (Precisely Speaking) and videos.

    We also work with a company that manufacturers special carbide taps and dies. They make precision drill bits and saws that cut metal. This company has been known for years for the quickest delivery and best customer service in the industry. Perfection is a core value of this Midwest manufacturer. Again, using information gleaned from surveys from their sales reps and major distributors we will deploy a brand theme rooted in the core values of this industrial marketer, “When Excuses Won’t Cut It”.

    We will use scripts in video of craftsmen on the plant floor, “Our customers won’t accept excuses and neither will I when it comes to making this carbide tap”. Or an interview with a customer service rep, “When our customer needs a carbide tap overnight…excuses will not cut it”.

    Each of these brand themes can also be internalized to the employees for better performance and enhanced morale.
    In a commoditized and time-crunched world a strong brand theme can make the difference between your company getting a phone call versus your competitor. However, the brand, as Darrin suggests must be based a real value in the market place. No BS!

    “By Tom Repp”

    • Very thoughtful analysis Tom.. I fully agree with your point of view. Though branding is not a primary driver of B2B marketing, it will certainly help in differentiating from the competitors and hitting the customer where it hurts!

  4. Kerry and Tom,

    Your examples provide great insight. However, I don’t think they prove that brand has any place in B2B. Rather, that value communication is of the utmost importance.

    From Kerry’s comments, “Better = better delivery times; better servicing of the product after the sale; more reliable; more innovative technology.” These are all examples of product features, which can be translated into real, quantifiable business impacts (or value drivers). Granted, some value drivers are easier to quantify than others. But each of these examples as a definite impact on your customer’s bottom line, and it is imperative that they understand that value in order not only to make the sale, but to achieve better margins.

    From Tom’s comments, I see these examples not as industrial branding, but as effective communication of the products’ value to customers. I say, job well done!

  5. There were several discussion threads in LinkedIn groups and here was a reply that I posted in one of the groups.

    This post really generated a lot of energy and a spirited debate. I love all of the passion and always learn from these types of interactions. I have tried to reply to comments earlier but had issues with my posts going through.

    In my post, I tried to clearly differentiate two concepts: Brand and Branding.
    • Brand (a Noun), as Joe articulated summing up most of your comments extremely well, and with which I totally agree, is “the sum total of a prospect’s impressions and experiences with a company.” I don’t believe that there is any disagreement on the concept nor the value of a strong Brand.
    • Whereas Branding (a Verb), is the act of attempting to create or define the perspective that a target audience (customer or prospect) has of the company or of its products.

    Given that I believe that we almost all agree on the first point, let’s focus on the second point around the act of “Branding.”

    Here is my belief – B2B Branding in the form of any and all of the following items (positioning, messaging, colors, slogan, logo, advertising, brand strategy, or any other form of promotion and I’m sure I have missed many items) will only be effective in the long run if it supports your TRUE value proposition delivered to customers relative to their next best alternative. There have been numerous examples cited where a company promoted their brand, but in the end every one of the successful examples had a truly strong value proposition to start with and it wasn’t the Branding that created the success.

    I will even take it one step further in terms of Brand promotion. Even if you have a very strong value proposition, the act of trying to promote it through a “Branding exercise” is cost prohibitive for all but the largest or best funded companies.

    Several have also mentioned that people buy, not companies, and that people make decisions based upon emotions. I agree conceptually and on smaller purchases, but in the end companies have worked hard to put both processes and people in place to limit individuals from making decisions based upon emotions and without business justification. Why do you think that CFO’s are so involved with significant buying decisions? That is not to say that there are not emotional factors that play into the buying decision, but prospects are working hard to minimize them.

    Here is how I would test my premise. For simplicity let’s break it into just two components: 1) the product/service and its associated value proposition and 2) the Brand, promotion, and/or mar-com for the company and/or offering.

    The test is whether either of these things is a) sufficient and b) necessary for a company to be successful. There are many cases where a company has a strong product and/or service without a clear Brand strategy and without any advertising and yet is still successful. The converse is not true in B2B. There are few, if any, examples of successful companies that have poor products lacking a strong value proposition even if they may have a strong Brand strategy and lots of promotion. All Branding and promotion will do in that case is accelerate the demise of the company.

    Therefore in B2B, it is much more important to have a strong set of offerings that fulfill a specific set of needs in the market creating value for a segment of customers than it is to have a strong Branding and/or promotion strategy. However, provided the company has a strong value proposition, I do agree that a good Brand strategy and effective promotion can help to accelerate and amplify success, but a Brand strategy is not sufficient nor is it necessary to be successful.

  6. Darrin, your conclusion is the opposite of your opening sentence. And I agee with your conclusion. What you are really saying is that advertising doesn’t make a brand, the value proposition and actual customer experience make the brand. I think the difference between B@B and B2C is the element of aspirational advertising and value proposition in B2C whereas in B2B, you need to deliver the goods or you lose your brand and market.

    • Mike, thank you for the comment! I don’t agree that my conclusion is the opposite of my opening sentence. The opening sentence was challenging the assumption that branding (the act of building or promoting a brand) is a primary driver in B2B success. The conclusion is that a B2B brand is built by delivering on a strong value proposition and that Branding (the act of building or promoting a brand) can help to promote or accelerate the success of the Brand, but it can not create a successful B2B brand. I do think that we are in agreement though.

  7. I totally disagree that a B2B brand can only be built by delivering on a strong value proposition and that branding cannot create a successful B2B brand. Whilst the former is obviously the ideal there are endless examples of inferior B2B products and services that have undeserved market leading positions due mainly to saturation spending on branding, sad but true.

    It’s also not the case that all business decision makers behave logically as you suggest. Too many B2B marketers ignore the emotional and human dimension of B2B decision making, they are not robots and they are influenced in many different ways including established branding techniques.

  8. Pingback: What is More Important in B2B: Value or Branding? | B2B Strategy and Value-Based Sales and Marketing

  9. Changing a company logo and adding a new catch phrase doesn’t replace poor customer experiences. SERVICE and word of mouth referrals are the key to a company’s success. Apple never changed their logo, yet they are known for easy to use products that work. They managed to go from a Macintosh that had limited applications, to the iPhone, iPad with numerous apps that people like, can use and want.

  10. Darrin
    For the most part I’m in full agreement that brand in the B2B world us near useless for most of us.

    The exception being, firms like IBM as evidenced by the old saying that “nobody ever got fired for buying IBM”.

    But unless you’re in the elite few, your wasting your time an money. You have to be a “heavyweight” to such an extent that you leave a “bootprint” for customers to follow. You need to ask yourself if you really are that much of a heavyweight and not let your ego color your opinion.

    Most of us are not real heavyweights, so take pride in your pretty logo and letterhead and move on to the important stuff.

  11. Ok… I’m not sure there’s a great deal of understanding of what the branding process does for a company, which is why there’s a belief that ‘branding’ has little value among small businesses. From experience it’s usually because small business’ hire (cheap) designers who don’t understand the full properties of branding beyond visual aesthetics and therefore, what they deliver has little commercial value (looking pretty just doesn’t cut it, especially in B2B).

    Let’s see if I can sum this all up in one sentence.

    The branding process is about a company discovering it’s unique characteristics (big idea/positioning… there’s a dozen words for it) and then visualizing / verbalising those properties as positive attributes to the desired consumer base.

    So yes, obviously there has to be SOME value somewhere. To truly benefit, you need to undergo the full self-analyses and market analyses that is required for the sort of effective branding used by top-tier companies. This is all done to simply sway decision making in your favor, by having a more positive perception than your competitors. (Though anybody who think they can control people’s decisions through branding is just delusional)

    But don’t think for a second B2B isn’t susceptible to similar perception tricks used in B2C marketing.. because behind a B2B company is just another person, who is just a regular consumer, who (like everyone on this planet) is just one more victim of PR.

  12. Pingback: What is More Important in B2B: Value or Branding? | Stratavant Blog

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