BUSINESS BUYER 2013 INSIGHTS

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1 BUSINESS BUYER 2013 INSIGHTS

2 BUSINESS BUYER INSIGHTS As a professional in B2B marketing & sales, business buyers give you a hard time more and more often. It no longer suffices to be present at trade shows, spend part of your budget on direct marketing and have your sales force travel the country. Conversion rates of telemarketing continue to decline, trade shows do not offer you an increased number of leads and your sales managers are anything but able to compensate for this trend. Moreover, you come across buyers who have done a great deal of homework before coming to you. In fact, occasionally a buyer has more knowledge with regard to the offer in your category than your sales manager does. So how do you make sure that your marketing and sales strategy is critically aligned to counter all this? Where do you find the vital insights you need? Surely you can turn to a countless number of gurus, specialists, blogs and communities in the field of B2B marketing & sales. Valuable as all these sources may be, it is much more important to turn to those who can provide you with the right answers: your target group. How do they actually go about it when considering buying a business service or product within your category? To what degree do they make use of white papers, online videos, word of mouth, professional advisors and so on? How long does the buyer journey actually take and at what moment do they approach suppliers? Such insights are vital to enhance your commercial success. 2

3 WE FILL IN THE BLANK SPACE Up until now, dependable insights into business buyers were not readily available, especially not when it came to the Dutch market. SpotONvision and TNS NIPO have taken the initiative to fill in this blank space. After offering you the B2B Marketing Barometer in 2011 and 2012, we now introduce Business Buyer Insights, the first ever comprehensive study on the behaviour of business buyers in the Netherlands. Results were presented in March 2013 at the annual B2B Marketing Forum in Amsterdam. We bring you Business Buyer Insights in order to help you become more successful as a marketing or sales professional. Ingrid Archer spotonvision Reg van Steen TNS NIPO Graphs or data from this report can be freely used, provided the source is mentioned: Business Buyer Insights 2013 by spotonvision and TNS NIPO. Free downloads at and

4 CATEGORIES COVERED Business Buyer Insights covers 18 different categories of products and services that can be purchased by organisations. It shows what these buyers actually did when they explored the offer, considered suppliers and finally made their choice. ACCOUNTANCY OFFICE EQUIPMENT ENERGY MAINTENANCE CONTRACTING FLEXIBLE WORKFORCE CLEANING PAYROLL SERVICES BROADBAND SERVICES SECURITY MOBILE PHONE / INTERNET CATERING COMPANY LOSS INSURANCE STAFF TRAINING COMPANY HEALTH INSURANCE EXPRESS MAIL COMPANY PENSION INSURANCE PARCEL MAIL CONSULTANCY ON ONLINE MARKETING This study offers insights into Dutch business buyers of organisations with over 10 employees. Both profit and non-profit organisations are included. We interviewed a total of 731 business buyers who in 2012 in the course of a buying decision explored the offer of at least one of the business services or products that are covered in this study. In other words: we focus on actual buying behaviour in the preceding year. Fieldwork took place in January 2013, making use of TNS NIPO Businessbase, the direct access panel of business buyers of TNS NIPO in the Netherlands.

5 BUYER JOURNEY DIMENSIONS Business Buyer Insights focuses on various aspects of the buyer s journey, such as: How often buyers orientate on a certain category How many suppliers they consider during the buyer journey How loyal they are How long the buying process actually takes Which online and offline sources of information are used Which sources of information are considered to be valuable, and which ones less valuable At what point, during the process, do buyers contact a supplier Variation in conversion rates of suppliers Budget spent annually on a category This booklet describes a selection of relevant findings, without pretending to give a full view of the B2B buyer journey. In fact, Business Buyer Insights clearly points out that there is no such thing as the B2B buyer, as variation across categories is highly substantial. If you would like to receive detailed information about your specific category, please contact TNS NIPO. 5

6 THE BUYING CYCLE How often does your target group embark on a buying journey? As one can imagine, buying cycles vary from category to category. From this fact we can deduce that there may not always be a clear start to this journey. Having said that, if you are a professional in the marketing or sales of office equipment, staff training or mobile services, you have a statistically better chance of approaching prospects who are in the window of opportunity. Organisations are relatively more often looking for (new) offers in these industries, most of them doing this at least once a year. However, when you are a supplier in categories such as security, accountancy or cleaning services, the window of opportunity regarding a single prospect opens significantly less often. This is relevant information for your commercial strategy. The hit rate of direct marketing activities for instance is highly dependent upon the chance of reaching your prospect at the right moment. From this point of view, it makes less sense to use DM in accountancy than in mobile telecom services. THE WINDOW OF OPPORTUNITY DOES NOT OPEN EQUALLY OFTEN FOR EACH CATEGORY read: 54% of energy business buyers have (re-)considered the offer of suppliers in ACCOUNTANCY SECURITY CATERING ENERGY OFFICE EQUIPMENT MOBILE TELECOM STAFF TRAINING

7 SOURCES OF INFORMATION USED Business buyers can draw on an increasing number of sources when exploring the offer in each category. We have assessed ten online and ten offline sources in this regard. Looking from a distance, it will come as no surprise that online sources are definitely on the rise. Business buyers point out that they increasingly make use of search engines, supplier websites and LinkedIn. On the other hand, some offline sources are losing ground: trade shows and exhibitions, brochures and unsolicited information by phone will need to be reinvented to become more relevant to buyers. ONLINE SOURCES OFFLINE SOURCES SEARCH ENGINES (GOOGLE, BING, YAHOO, A.O.) TRADE SHOWS AND EXHIBITIONS WWW COMPANY WEBSITES CONGRESS / SYMPOSIUM / SEMINAR COMPANY S BLOGS LINKEDIN COMMUNITIES OTHER ONLINE COMMUNITIES SPAM SPAM BROCHURES / FLYERS UNSOLICITED BROCHURES / FLYERS REQUESTED UNSOLICITED INFORMATION BY PHONE REQUESTED INFORMATION BY PHONE TWITTER ADVERTISEMENTS FACEBOOK SALES FORCE ONLINE VIDEOS OTHER SOCIAL MEDIA INDEPENDENT PROFESSIONAL ADVISOR WORD OF MOUTH

8 USAGE OF INFORMATION SOURCES VARIES STRONGLY BETWEEN CATEGORIES General findings with regard to the use of sources of information are actually not all that relevant for each individual category, as we witness a strong variation in this regard. For example: supplier websites are significantly more important when business buyers are checking out the offer of staff training programmes: two out of three make use of such websites. This is quite unlike the situation in the field of accountancy services, where just one in four business buyers take the time to see what websites of accountancy firms have to offer. 67 Another ironic example can be seen in the field of advice on online marketing strategies, where business buyers very often turn to an offline source: the sales representative (61% of them do so). This compares to just 33% of energy business buyers who do the same thing. Does all this mean that a sales force is not important in the energy industry? No, it does not, but it does show that it merits a tailored approach for each category STAFF TRAINING ACCOUNTANCY ENERGY CONSULTANCY ON ONLINE MARKETING SUPPLIER WEBSITES SALES REPRESENTATIVE

9 PERCEIVED VALUE OF SOURCES It will come as no surprise that business buyers value information received from an actual person the most. This becomes clear if we look at the three most valued sources of information. It puts the rising use of online sources of information into perspective. Ultimately, most business buyers want to be able to look someone in the eye (admittedly, word of mouth can also be received online). On the other side of the table, three sources of information stand out as being least valued by those who made use of it: telemarketing, direct mail and advertisements. It calls for a serious evaluation of such marketing instruments. With a decreasing ROI of DM, one may wonder whether it is worth exploring alternatives such as inbound marketing instruments. APPRECIATION OF SOURCES OF INFORMATION (BASE: THOSE WHO USED SUCH A SOURCE) MOST VALUED LEAST VALUED INDEPENDENT PROFESSIONAL ADVISOR UNSOLICITED TELEMARKETING WORD OF MOUTH ADVERTISEMENTS SALES FORCE UNSOLICITED DIRECT MAIL 9

10 STILL A SMALL ROLE FOR SOCIAL MEDIA The TNS NIPO B2B Marketing Barometer of 2012 showed marketeers investing heavily in company websites. And rightly so, as Business Buyer Insights is showing a strong rise when it comes to usage of websites and search engines. Despite a perceived increase in usage, the likes of LinkedIn, Facebook and Twitter are still in their infancy. In fact, business buyers make very little use of Facebook or Twitter within each specific category. LinkedIn is a modest exception to this rule, though fewer than one in ten business buyers make use of LinkedIn when it comes to gathering any sort of information on a category. Within some categories such as company loss insurance schemes, LinkedIn is not even used at all. % BUSINESS BUYERS CLAIMING TO USE MORE OFTEN WWW TWITTER FACEBOOK LINKEDIN SEARCH ENGINE SUPPLIER WEBSITES 10

11 A HIGHER DEGREE OF SHOPPING BEHAVIOUR DOES NOT NECESSARILY IMPACT LOYALTY In certain categories such as mobile telecom and staff training, business buyers more often check out what the market offers. This does not appear to be related to loyalty however. In fact, security and accounty services witness shopping behaviour that is less strong, but also a lesser degree of loyalty when a customer does take the time to see what the best offer is. 100 LOYALTY % staying with present supplier 75 ACCOUNTANCY COMPANY PENSION INSURANCE COMPANY LOSS INSURANCE MOBILE PHONE / INTERNET STAFF TRAINING 50 SECURITY ORIENTATION % of buyers who orientate 75 11

12 LENGTH OF BUYER JOURNEY AND TIMING OF RFQ As one can imagine, the buyer journey takes more time with regard to categories that are perceived as being more complex or less urgent. On average it takes 98 days when it comes to company pension plans, whereas looking for a supplier of temporary workers takes a fraction of that time (17 days on average). But when does the business buyer actually contact a supplier for the first time to ask for a quotation? TIMING OF RFQ Rumour has it that the timing of an RFQ takes place when more than half of the orientation process has taken place. This is anything but the case, as on average suppliers are approached for an RFQ much earlier than that. Again, we do see variation between categories in this regard. For instance: quotations are LENGTH OF BUYER JOURNEY AND TIMING RFQ CATERING CONSULTANCY ON ONLINE MARKETING COMPANY PENSION INSURANCE FLEXIBLE WORKFORCE requested fairly early when it comes to mobile telecom services and at a later stage when one is considering hiring a consultant when it comes to an online marketing strategy. For the latter category, the timing of RFQs is somewhat scattered throughout the buyer journey. TIMING OF RFQ DURING ORIENTATION PROCESS ADVICE ON ONLINE MARKETING STRATEGY MOBILE TELECOM START ORIENTATION = timing of RFQ END ORIENTATION

13 FOUR B2B SALES STRATEGIES Buyer behaviour is dependent upon the perceived lack of knowledge of the buyer on one hand, and the perceived purchase risk on the other hand. This basically calls for four B2B sales strategies: 1. a self-service sales strategy if the buyer perceives little lack of knowledge on the topic and little risk 2. an informing sales strategy when there is a degree of lack of knowledge, but little risk 3. a reassuring approach when there is no significant lack of knowledge, but if a degree of perceived risk is present if making the wrong decision 4. a consultative selling strategy if there is a large degree of lack of knowledge along with a high risk perception. We have plotted some categories in the diagram shown below. Please take note that the right sales strategy is always dependent upon the actual buyer. In other words: an individual business buyer with a great deal of knowledge about, say, pension insurance schemes may not need a consultative selling approach on this topic. HIGH MAINTENANCE CONTRACTING ACCOUNTANCY COMPANY PENSION INSURANCE PERCEIVED PURCHASER RISK (complexity of purchase) LOW REASSURING PARCEL MAIL COMPANY LOSS INSURANCE OFFICE EQUIPMENT SELF-SERVICE CONSULTING STAFF TRAINING INFORMING MOBILE TELECOM INSPIRED BY JOEL YORK LOW PERCEIVED LACK OF KNOWLEDGE OF PURCHASER (complexity of information) HIGH

14 NEED SPECIFIC INSIGHTS ON YOUR BUSINESS BUYERS? Tailored in-depth reports on business buyers are available for each of the following categories: ACCOUNTANCY OFFICE EQUIPMENT ENERGY MAINTENANCE CONTRACTING FLEXIBLE WORKFORCE CLEANING PAYROLL SERVICES BROADBAND SERVICES SECURITY MOBILE PHONE / INTERNET CATERING COMPANY LOSS INSURANCE STAFF TRAINING COMPANY HEALTH INSURANCE EXPRESS MAIL COMPANY PENSION INSURANCE PARCEL MAIL CONSULTANCY ON ONLINE MARKETING If you are interested in acquiring one or more of these category-specific insight reports, please contact Reg van Steen at or Reg.van.Steen@tns-nipo.com. 14

15 ABOUT SPOTONVISION Founded in 2006, spotonvision is a B2B marketing agency with a strong and proven track record in helping marketing professionals drive strategy and pipeline growth. With a dedicated passion for B2B marketing, a vast knowledge of the buyer process, content marketing and technology, spotonvision believes in customer-based and holistic marketing. By bringing strategy, execution and technologies together spotonvision helps customers to increase the value of marketing in the organisation. Our four-corner framework of buyer insights, content marketing, lead management and marketing automation combined with handson strategic B2B marketing professionals enables our clients to drive pipeline, credibility and value. With more than 30 years of experience in marketing, sales and communications, spotonvision serves clients in various B2B markets. spotonvision are also the founders of the B2B Marketing Forum Benelux. ABOUT TNS NIPO TNS NIPO is the Dutch branch of the international organisation TNS, which has a footprint in over 80 countries. TNS NIPO has decades of experience when it comes to covering business-to-business markets. We develop precise plans that identify growth opportunities for our clients. We do this in various areas such as innovation, product development, positioning, branding, customer experience or for instance pricing. We own a dedicated panel of business decision makers, have parented initiatives such as the B2B Marketing Barometer and publish a monthly corporate sentiment study (Ondernemerspeil in Het Financieele Dagblad). If you want to know more about our expertise in B2B or in other markets, please contact us. 15

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