For technically complex B2B products and services there are very few benchmarks for how split your marketing budget between Owned, Earned and Paid. Complex B2B markets may include categories such as herbicides for commercial agriculture and mobile phone systems for remote mines. My greatest mentor preached 'To find a better answer, find a better question'. So switch the question from 'What is the budget split?' to 'How do we improve the customer experience of the first search-to-buy journey?' (Maechler 2017). This methodology will drive your team to track customer delight and despair then spending the budget accordingly.
One conceptual solution is labelled the 'Advertising Intensity Curve' (Jones 1990) and typically concludes that smaller and lower ranked brands have to spend more on advertising. The surveys produced a number of useful if very high level benchmarks. More recent studies reinforce that advertising intensity shows a similar pattern with Owned and Paid media, and again that smaller and less successful brands spent proportionally more (Jayson 2018). Also, there is commonly synergy between all marketing channels (Jayson 2018).
In contrast, an extreme case of Earned and Owned but zero Paid is Elon Musk and Tesla who 'do not advertise or pay for endorsements'.
Marketing non-Spectacular Products
If you do not sell rocket ships, luxury electric cars, and are not a USA Presidential candidate with a background in reality TV but rather sell mundane industrial products then marketing is generated by marketing investment. To illustrate a product where Earned is hard to come be, imaging your task is to create interest, sparkle and positive comments for a preowned Caterpillar 988F (see below the large yellow digger).
B2B Industrial products are rarely spectacular thus require direct investment.
B2B complex products have some unique challenges
Traditionally, winning in the B2B arena has been a matter of being in the right markets, offering superior products and services, or being the lowest-cost producer. As these advantages are threatened by increasing global competition, many players have differentiated by invested in the purchasing customer experience (Maechler,2017). This is not easy because B2B customers buying expectations are influenced by B2C platforms and these have much larger budgets for example eBay or Amazon with their US$23 billion R&D budget.
Another challenge with B2B is relationships are deeper, more complex, involve many people, include extensive customisation and the stakes are far higher (Maechler,2017). These factors tend to obscure marketing directions with clouds of complexity. A critical role for the marketer is clarifying the picture for the rest of the team.
Hubspot have an intimate relationship with their customers and online visibility of their customer data yet the 2020 Business Survey was only able to segment the B2B benchmarks into 6 categories. For complex B2B perhaps 6,000 categories would have been more useful
Focus on the customer buying experience to guide your spend
Instead of seeking arbitrary benchmarks of spending consider this. B2B sales are extremely dependant on very few key buyers with few strategic experiences. So focus on these customer purchase experiences with paid search ads, advice blogs, online ordering, white papers, conference papers, branding ads, sponsorships, word of mouth, discussion forums, break down support, re-ordering, training and general buzz are massively influential.
To move forward and simplify an otherwise complex world, wrap you Social Media budget around the buying pathways listed below (Maechler,2017).
Identifying products and services: B2B customers often find it challenging identify the optimum product or service in a sea of repetitive technical phrases. A recent client found nothing on search because they typed gas injection skid rather than metering injection skid.
Selecting a supplier and making an initial purchase: B2B buyers often struggle to compare suppliers in a timely manner due to multiple criteria.
Codeveloping products with a supplier: This is a critical journey in innovation-heavy industries but keeping projects on budget and target is complex.
Dealing with unexpected events: Equipment breakdowns or missed deliveries can make-or-break the clients experience
Re-ordering and planned maintenance: This final journey involves reordering a well-known product or service
Listen again to your customers through this framework and ask if there are holes in your customers purchase pathway.
REFERENCES
Jones, J. P. “Ad Spending: Maintaining Market Share.” Harvard Business Review, January–February 1990.
"Finding the right digital balance in B2B customer experience." Nicolas Maechler, Adina Poenaru, Thilo Rüdt von Collenberg, and Patrick Schulze, McKinsey & Company, April 2017
"How Synergy Effects of Paid and Digital Owned Media Influence Brand Sales Considerations for Marketers When Balancing Media Spend" Rob Jayson, Martin P. Block, Yingying Chen, March 2018 JOURNAL OF ADVERTISING RESEARCH
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