Frost & Sullivan hosted a webinar called “Marketing to the Industrial Sector: Building a Better Online Strategy” on Tuesday, August 24th. This discussion focused on marketing online, specifically how it relates to industrial markets.
Issues & Challenges
-The manufacturing sector has historically been slower to adapt to online marketing. It has generally been a “follower” when it comes to adoption.
-The buy cycle for the industrial segment hasn’t changed, but the way potential buyers look for information has. For instance, from print catalogs and industry publications and sales calls to now being online every step of the way in the purchase process.
-As industrial online marketing acumen has increased, so has the focus on results. Results have shifted from a historical focus on volume (hits) to a focus on lead generation.
-Characteristics unique to the industrial space versus other industries are:
- Supply chain logistics differ from other industries – with a direct sales force, cross channel conflicts present themselves as product information becomes more accessible online.
- Product complexity - products more complex, and more stakeholders are involved
- Purchasing lead times - the process usually takes longer the more complex the product
-These unique characteristics contribute to the following challenges in utilizing online marketing to reach the industrial audience:
- Network and Status Quo – Engineers have a tendency to work through grass roots personal networking such as tradeshows and personal sales calls, as well as maintaining the status quo by staying with the current supplier and not wanting to try anything new
- IT Security and Privacy – Since the industrial segment has many trade secrets and complicated products, which require the utmost privacy and security, it is difficult to share much of their information on social media-type channels
- Use of Demand Generation Activities – Lack of experience and slow to adopt to CRM and online sales processes
- Website Centricity – With finite marketing budgets companies tend to concentrate on their own websites instead of using other online marketing methods. Whatever funds are left over is used in an ad hoc way for other online marketing channels.
- Provision of Fresh Content – New content is a key feature that brings the industrial audience to their favorite websites. However, it is time consuming and cumbersome for sites to keep updating their content.
Future Trending
-Despite the challenges mentioned, online marketing spend continues to grow in the industrial space as industrial marketers get more sophisticated with the tools and are able to positively quantify ROI in their online marketing activities.
-Traditional Media spend has been on the decline but has not completely gone away (print advertising, white papers, tradeshows, etc are still of value).
-Online allows for “doing more with less” and allows for improved ROI measurement compared to traditional media such as tradeshows.
-Growth of online in the manufacturing sector is expected to increase over the next 5-10 years, while offline media will remain fairly steady but on a decline trend.
The Industrial Purchase Process
-Needs Awareness-->Research-->Consideration & Comparison-->Procurement
-Differences between B2C & B2B buying
- Interest is based on real needs and problems and impulse buying is not a factor in B2B
- A lengthy, complex process involving multiple decision makers, mostly due to the risk involved, so big purchases are made under a lot of scrutiny
-The internet has made this process much easier and faster for engineers, according to the 2010 GlobalSpec Economic Outlook Survey
- 46% of industrial professionals are online 6+ hours a week for work purposes
- Search engines (78%), supplier websites (76%), and online catalogs (72%) are the top 3 information sources for work-related purposes, out of both online and offline sources
-Numerous suppliers are evaluated before purchase
- 42% of engineers evaluate 4 or more suppliers during the Initial Research phase
- But when buyers move to the last stage, only 26% will get quotes from 4 or more suppliers
- 63% of engineers get quotes from 3 suppliers
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- What this means is that industrial suppliers want to be present during all stages of the buy cycle, but especially in the beginning research stages as much as possible to be even considered as a supplier contender. This means have the relevant content to satisfy the engineers’ needs
How to capture this audience?
Get in front of them early and often by utilizing various platforms where engineers are looking online. They want content that helps educate them, improve their decision making capabilities, and increases their confidence. GlobalSpec found that to accomplish this, you should have as much relevant content online as possible since:
-83% of buyers review ≤3 pieces of content for purchases ≤$1k
-70% of buyers review ≥4 pieces of content for purchases ≥$10k
The higher the average order size, the more in depth content needed to support your sales effort. You can easily perform a content audit to see if you need more information available depending on your average order size. You could even need less if there is too much information out there that could confuse your customer further. Content is anything that describes your products or services.
In summation, the webinar suggests industrial online marketers:
-Get found early and often in the buy cycle
-Be found where the audience is looking – online
-Understand the company’s buy cycle and have content to support it
-Conduct a content audit to ensure the right content is available in the right stages
-Seek many different types of outreach – including webinars, white papers, case studies, etc, with relevant content for your audience
Is B2B your target audience? What kind of challenges are you facing? What works for you?
--Marina Chanthakhoune and Steve Schulte for FRWD
FRWD;)
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