Digitization to Transform Marketing in Manufacturing: Not the product is important, the customer is

03.09.2018

The digitization of industries is a development no business can deny. The manufacturing sector is no exception in this case. Market participants however, often struggle when it comes to moving over to a digitised infrastructure.

Many decision makers have already set the course in development, logistics and production. In marketing and sales departments though, innovative digital strategies are still hard to find and reasons for this are manifold.

Founder and CEO of German digital agency Cocomore, Hans-Ulrich von Freyberg, together with Consulting Director, Robert Petzold, outline how to avoid the three severest misconceptions business leaders can have.

Misconception Nr.1: Digital is secondary

Investing in the digitization of a business is nowadays a management issue. Decision makers in marketing and sales departments in particular are trying to understand why a digital marketing strategy is important. “After all that’s what we have our sales team for which is well acquainted with our clients.”

In some way this point of view cannot be denied. Marketing teams in the manufacturing sector usually do not only know most, but rather ALL of their clients - especially those aquiring highly specialised investment goods. These accounts, usually only a few hundred globally, represent the fuel that keeps a business going.

A B2B client’s user journey is like a pipeline which needs to be safeguarded from losing any bit of valuable customer loyalty or purchase intention. Marketeers should offer customised and relevant information to interested clients at every step of their journey.

Take, for a example, a client whose business depends on a specific machine-part critical to his business. Production will come to a standstill without it. For this client it is of utmost importance to understand how the relevant supplier organises the proactive maintenance of these machine parts. For another customer however, such a downtime of the machine part is a predictable and therefore bearable risk. This client will not invest in proactive and costly maintenance, but value a quick turnaround of the defect in case of damage within a guaranteed amount of time.

Digital touchpoints enable us to differentiate between cases like these and to develop targeted and personalised information to remain relevant for the client.

Returning to our initial thought: account managers know their clients and are in close contact with them. But do they really communicate with each and every person involved in the purchasing process? There may be co-decision-makers they do not know personally but who gather information independently and help shape company processes. They could be managers, controllers or simply influencers. In most cases these contacts can only be reached via pull or inbound measures which is why the supplier’s website plays a crucial role. In contrast to the B2C sector we can safely say that any person involved in the purchasing process will sooner or later inspect the website during their ‘evaluation journey’.

Misconception Nr. 2: Decisions are made rationally

Decisions in manufacturing are not only rationally, but also emotionally made. A purchase in the B2B environment is not based on impulse like buying a bar of chocolate at a petrol station. Quite the contrary: responsible buying centres usually prepare an acquisition well in advance.

Because of this time-consuming preparation, B2B companies are forced to create an emotional motivation for their customers. B2B buyers therefore, have to anchor the idea with head and heart that one particular supplier will deliver a solution to their problem.

Considering the role of brand recognition and recall when it comes to online search behaviour of potential clients, the significance of positive emotional reference becomes apparent. Interested parties evaluating longer and more thoroughly are more likely to use search engines.

Research studies confirm that a vast majority of B2B buyers are already using Google and other search engines for their research before contacting a supplier. However, if interested parties use generic terms when searching for a product, the sheer appearance in the search result using SEO/SEA is a necessary requirement for the supplier’s success. The latter eventually clicks if the supplier brand generates an emotional memory in the user's search result. This could add up to the crucial percentage points for conversion rate and marketing effect.

So even in the B2B market it's all about the subconscious - just like in B2C. This is best proven by using online search results as an example: The company name appears next to competitors and generic results - and the user must be able to assess within milliseconds if the click on the company name will pay off. Such a level of trust is no result of purely informative communication, but an emotional predisposition from previous contacts with this company. This even applies to engineers of automotive groups trying to find information about products of potential suppliers and who firmly belief they are acting purely rationally during the process.

Last but not least we should not forget that a decision-maker during his ongoing consumer journey will also get on if he has a fundamental sympathy for the supplier.

Misconception Nr. 3: It’s only about the product

As we stated before, industrial companies do not offer chocolate bars. Even though it could be that simple in the B2B sector: Take for example companies that sell raw materials or equipment of low complexity. In this case it is not the product itself that provides the B2B-typical "need for explanation". It is rather about solutions concerning the product and comprehensive projects, i.e. integrated systems and environments consisting of many complementary products, consulting and services.

An automobile manufacturer for example is currently designing a rather simple component for a new car model and would like a supplier to develop and produce it. The number of participants is enormous all the same, as are the decision-making criteria. In order to select the right partner, the manufacturer has to assess a rather complex cooperation extending across numerous companies, often even across national borders. Positive project factors are as important as product features, for example attracting customers’ interest or positively influencing their purchasing decisions. The communication of project factors means that the information along the entire customer journey should also involve the possible cooperation. This is particularly important in the case of a commodity product. Decisive distinguishing features can usually only be communicated at the meta-levels "project" and "cooperation".

During such a process buyers usually have very specific questions in mind the supplier should be prepared for: "Who will be my first contact, who will give us advice", “What kind of resources will the supplier bring in already at the evaluation level" or "How is the supplier positioned in terms of IT and will our systems be able to seamlessly interact with one another?”.

Marketing managers are able to address these questions in many different ways, for instance by help of videos that convey credibility and sympathy and in which real employees report on genuine projects. They should clearly emphasize tangible benefits and expertice as well as address all parties equally involved in the buying center. Mandatory references and case studies can be designed similarly to project reports illustrating the supplier’s specific methodology. Experience proves that the interested party is able to imagine what to expect which in return has a positive effect on their decision.

Mistakes Turn into Rules of Thumb

All in all, it is about doing the right thing and not just avoiding mistakes. The three classic misconceptions described in manufacturing marketing point in the direction of three rules of thumb:

  • a successful sales team needs the right digital presence
  • emotional communication does not only win over hearts, but also market share
  • context sells: product as well as project communication belong together

Heeding these basic rules marketing manager will in times of digitization remain successful in the B2B environment.

Dr. Hans-Ulrich von Freyberg

Hans-Ulrich von Freyberg is founder and CEO of German digital agency Cocomore which focuses on digital marketing, IT as well as experience design. The agency is based in Frankfurt and Cologne in Germany and Seville, Spain, and has a total of 180 employees.

Robert Petzold

Robert Petzold has been Director Consulting at Cocomore since January 2015. He mainly advises customers in the B2B sector and designs strategic measures for digital marketing ecosystems.