Social Media Supports Changing B2B Buying Landscape

B2B marketers understand that they are operating in a different environment for a variety of reasons. These include a tighter economy, more rigor around business decision-making and the growing importance of social media in all B2B industries.

Two recent charts with survey data from Marketing Sherpa show a changing landscape of B2B transactions. The first shows the change in average deal size from 2010 to 2011. More than half of the deals closed by B2B companies are under $10,000, with the largest number of them (32%) between $1,001 and $10,000. This indicates that many of the larger deals, sometimes thought of as the hallmark of B2B sales, are not happening in the same numbers as before. It is easy to speculate that this is partially the result of the economy, and companies are just not spending the way they have in the past.
B2B-sales-deal-size

The second chart shows that the length of the buying cycle is shorter. This is defined from first lead inquiry to purchase. While the most common cycle is 1-3 months in both 2010 and 2011, the number increased in 2011. The number of responses of less than a month also increased. There were fewer in the ranges of 4-6 months and 7-12 months in 2011, and only cycles of more than a year held steady. This follows the first chart pretty naturally. If sales are down then the time to complete those sales is shorter.
B2B-sales-cycle

B2B Social Media Marketing Takeaways:
1. If you sell an expensive, complex product, it is more important than ever to embrace social media. With fewer sales in 2011, does 2012 look any different? This means that every customer and prospect is more important to your sales conversion. You need to work harder to discover new leads and work harder to retain customers. Social media can assist with both discovery and retention.

2. Consider expanding service offerings or other smaller sales to support larger customers. If buyers are not upgrading products or systems, they will require more support in the near term. Look for ways that social media influenced content (ebooks, custom videos) can support those relationships in the absence of enhanced paid support models.

3. One of things that we have learned about the buying cycle in the social media era is that prospects contact a sales rep after 60% of the cycle is complete. This means that a company no longer contacts you for general information, but they seek it out themselves from the web, including social media platforms. This makes a social media presence an important part of reaching prospects. Your B2B company needs to demonstrate expertise by sharing valuable information to be included in the consideration phase of the buying cycle. This is no longer a linear process and there are many stops along the way.

How have your B2B buying cycles changed and are you able to use social media to address these changes?

Converting B2B Sales Data into Social Intelligence

Given the explosive growth in business and social data, it would be natural to assume that B2B sales and marketing professionals have access to a wealth of new information to learn about and engage the savvy, social buyer we call Customer 2.0. However access to so much data comes with a hefty productivity price tag. Finding the relevant nuggets is a lot like looking for a needle in an ever growing haystack – not to mention the effort required to reconcile all the data inaccuracies and conflicts that inevitably arise from the multiple “sources of truth.” So the question for the B2B professionals should not be how they can gain access to even more prospect data, but rather how easily they can distill this mountain of data into actionable intelligence to engage their prospects in a meaningful manner.

So how is sales data different than sales intelligence?

Sales data, refers to the quantifiable facts and figures about prospects, including company and contact details as well as financials, that can be pulled from a variety of editorial or user-contributed sources. Online Sources of B2B Data: A Comparative Analysis (pdf) and its sequel (pdf), compares several B2B data vendors based on three criteria: volume (how many good contacts can I retrieve from this system?), completeness (can I get every field I want?), and accuracy (is the contact information correct?). One interesting takeaway from this analysis is that though there is a great deal of prospect-related data out there, it isn’t easy to assess accuracy or completeness of account or contact details given the preponderance of sales and marketing data sources.

Intelligence, however, is about making sense out of this ubiquitous and sometimes conflicting mass of data and turning it into actionable insights to engage the prospect. In other words, intelligence is about synchronizing “what you know about who you know” with “when and where you should know” it to ensure you engage the right people at the right time with the right message! The Web is providing billions of new data points and opportunities to gather unique insight via social communities, search queries and purchasing behaviors. Opportunities to gather data are abundant, but what is truly important is how a company, or sales rep, will learn from such information for the purpose of increasing sales. Intelligence goes far beyond the basic facts and figures about companies and creates a broader view in the prospect that incorporates recent business events, social conversations as well as social relationships. It becomes the essential piece of the social selling puzzle.

Data can also be misleading. A statistic, without context, may throw a company in a tailspin if applied before cross-referencing other pieces of data that influenced the specific finding. David McCandless, data journalist and author of The Visual Miscellaneum, recently named his speech at TED, The beauty of data visualization (I highly recommend watching this presentation). David emphasizes visual data and data comparison for greater intelligence, rather than static and out-of-context analytics.

Community + Data = More Clutter

Online communities provide platforms for customers and prospects to pose questions and gain new insights into the products, services and companies they are considering. As people become more comfortable sharing information online than ever before – even when this means visiting a company’s community to express their angst with the vendor’s product – data about companies, people and products proliferate.

This of course provides sales reps the opportunity to monitor such communities, listen to conversations and pull data about which products, initiatives or personnel are – or are not – successful. However, the number of social communities is enormous, and continues to rise as global adoption of the Internet increases. A better solution must be put in place for easily accessing and making sense of this data to accelerate the sales cycle without costly productivity impact to the sales and marketing organizations.

Social Intelligence

The solution: Social intelligence. With such an abundance of data, companies that find the most resourceful method of distilling relevant intelligence from available data are those that will reap the greatest rewards. Of course, companies have begun realizing this, and vendors are answering the call. The question is not “if” but “when” your company will join the intelligence tea party. Whether the solution is infographics that extract trends and patterns from data or technologies that aggregate online community insights, or augment traditional business insights with social perspectives, organizations must realize the massive productivity promise of social intelligence.

What are your plans for shifting your sales and marketing organizations reliance on static data – and turn them into productive consumers of dynamic business and social intelligence?