B2B Marketers, Please Stop Asking: ‘Does it Scale?’

Jul 11, 2022

Somewhere along the way, business-to-business marketers have become ‘consumerized.’ I’m not exactly sure when it happened, but I do know where to place the blame – MarTech companies, writes Carbon Design founder Scott Gillum. He explains what bad habits B2B marketers must squelch immediately.

Lacking the ability to prove that their technology can actually improve the performance of marketing programs, B2B marketers have too often traded on the ability to do more. Their value proposition basically follows the line that in order to reach performance targets, you must go broader and more often. If you’re getting a 3% response rate, you need to reach the largest audience possible.

Stop sign

Gillum urges marketers to think less about ‘scalability’ and more about ABM plans

So, let me help remind marketers that in B2B, it’s not always about reaching a broader audience. In fact, most times it’s not. After spending a dozen years in the consulting business analyzing customer revenue, I can safely say that in B2B, the Pareto principle is always true – 80% of your revenue is coming from 20% of your customer base.

If you’re in certain industries, like financial services or one that targets the enterprise segment, 90/10 may be the case. In fact, if you evaluate the “long tail” of customers you will most likely find that the smallest segment of customers (20% or less of your revenue) is most likely unprofitable. This begs the question, why do we need a platform to reach our smallest, least profitable customers? You know the answer; it’s because we need the largest list to hit our numbers.

We are at a crossroads.

We are investing in going another mile wider, rather than going an inch or two deeper. To get the greatest return on our marketing dollars, we should focus on the largest accounts, but we have acquired tools built for scale. As a result, any success we have at improving conversion is always met with the same response: “Will it scale?”

Here are some other data points to help us guide ourselves back to the real world of B2B. Between 85 and 90% of your revenue comes from the sales channels, meaning only 10-15% of the year’s revenue will have been sourced by marketing.

So, what is all this investment in scaling us? It keeps our performance metrics low because of the size and volume. Most of our content marketing engagement efforts are with non-decision makers, and if we’re lucky enough to snag a buyer in mid-cycle, it only accounts for potentially 10-15% of revenue.

Because sales is smart enough to avoid small customers, we may end up creating a lead in an account that is actually costing the company money. Bottom line, the focus on scale often devalues marketing’s impact to the organization.

What marketers should do

Marketing should be exploring better ways to motivate targeted audiences to act. Everything we do as marketers is about getting someone to do something, whether it’s opening an email, registering for a webinar, or downloading a report. None of our existing “scaling” tools help us understand how to make that happen.

To do this, we must understand audiences at a deeper level, beyond the “offer,” which is most often not aligned to buyer preference. Let’s break this down into simple steps: A response is an action; an action is created by motivation; motivation varies by individuals, based in part on their interest, but mostly on their personality.

Knowing a buyer’s motivations and behaviors by understanding their personality type is the key to understanding how to get them to act. It’s that simple, and it gets even easier when you know that in every industry we assessed (nine so far) there are one to two dominant personality types that make up 65-75% of that audience.

Now to bring it all together: for most companies, the top 20% of accounts easily represents more than half of the yearly revenue goal. If you are targeting the enterprise segment, it will be higher. The top of the customer pyramid is often less than 50 accounts. Focusing on going deeper into finding ways to connect with one or two personality types in less than 50 accounts doesn’t require scale – it requires strategy. It’s about being smarter and building a customized ABM plan for each account.

Embracing this approach offers B2B marketers a huge new opportunity to redefine their value to the organization – in particular, sales. Having success in those accounts far outweighs anything that requires scale.

Yes, many of the tools in the MarTech stack are useful, but they are not the answer, and unfortunately we’ve let them influence our behavior, decisions, and activities too much. It’s time to refocus our efforts from all potential contacts to better understanding buyers in your largest opportunities. And it’s time to stop resisting and deflecting opportunities that take effort to make real improvements by asking the question, “Will it scale?” Unless of course, you’re Microsoft or Google targeting the SMB, then it’s perfectly fine to ask.

By Scott Gillum