078. How Branding Impacts Demand in B2B

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Welcome back to another episode of Demand Gen Studio. As always, I am Miranda Jenkins, the founder phi and then joined by Emilio Garcia. How's it going, Emilio?

How are you, Miranda? Doing great on this again. We, we keep saying that super chill, super cold mornings, at least for Greenville they are is this, it's been a handful of years since we had this very low temperature, so but sunny. So that I think is fantastic. Sunny, cold days are great.

Yeah. Awesome. Well, today we are talking about a interesting topic for B2B and that is how branding impacts demand in B2B. So if you've spent any time in B2B marketing, you've probably earned some version of the question or debate of if you should invest in brand or if you should invest in demand and what you should start with, how much budget should go to what and all of that. And usually demand is the one that wins out because it's more measurable and you can more easily tie demand directly to their pipeline. So today we're going to talk through how brand influences demand creation, where brand shows up in the funnel and how to measure branding's impact on demand. So I don't know if you have any opening thoughts on this topic, Emilio.

Yes, I, I, I think that what makes brand and the impact of brand controversial mostly has to do with perspectives. And those perspectives will come from two big factors, I think. One is the size of the company. That's a big one in my experience, direct experience as an employee and in things related to marketing before starting magnified, there was no question about the importance of brand and large companies, large enterprises in large companies even, even sales reps complain about the strength of the brand as a factor for them not closing deals. Right. If you say I work for a strong brand, things will come along my way and I will close faster and that will be something that even sales rep which are not doing marketing will be acutely aware. In smaller companies, that's not the case the smaller companies, I think there's this more perception that whatever marketing does will have to have a very direct impact on the sales cycle or on the sales opportunities and other big differences B2C to B2B which we talked about very frequently. Right. Again, I think this is more of a perception because I don't have a lot terrible experience with B2C that brands that sells to end consumers have no doubt that mostly what they need to do is to build brands. Right. That if you don't have a strong brand, they will struggle, they will find, they will have to find ways to Present the product on other establishes brands with meaning putting on Walmart, putting on Costco, finding distribution channels until you build something larger. So I think in B2B is also, especially if it's a smaller B2B company, easier to think that the strength of the sales team is the only thing that you need to close business. Right. If I just have a conversation, if I just knock on doors, if I just had, if I just go to networking events, then that's more than enough. But again, right, if you do all those activities but have a strong brand, the result will be different. So you know, I'm sure we're going to pack a lot of detail into that. But from a broader perspective, I think a lot of the controversy comes from people being in smaller versus larger companies or people working for B2C versus B2B companies, especially if there are smaller B2B brands. That's where most of the pushback will come from.

Yeah, and when we talk about having a strong brand, it's easy to kind of fall into the thinking of or you initially think of your brand as your logo, your colors, your font. But brand, your brand is a lot more all encompassing than that. And from a buyer's perspective, your brand consists of your ads, it consists of your website, the look and feel of the website, your messaging, the consistency in your sales deck from all of those other assets, your CEOs, LinkedIn posts, all of that kind of falls under a buyer's perspective of what your brand is and leads into the impression that, that they have of your company. So how would you, what are your thoughts on like the definition of what brand consists of in B2B?

Yeah, I love what you're saying. And I will add that at the end of the day, in the mind of the buyer, I will include into that group of assets, right? Branding assets. I will include this period of the service of the product. Right. This is the part that is very hard that you have the luxury of having a positioning in a way of presenting the brand for a person that had never bought of your product before service and they're experience it. So you can position yourself as, you know, high end, low end, fast, slow, high quality, whatever is your positioning or expertise in certain area. But at the end of the day, as people start interacting with the product or services, they will have an opinion of it based on experience. Again, this is easier to see in B2C products. Like if you think about banking for example, right. You mention a brand and yes, in your brain it will be the logo, the position in the jingles, you know, whatever, whatever. But you have a specific experiences about those banks, not only directly, but from others. And that's part of the perception of the brand. I will just add that it's even not only just the assets are a medium to something that will be considered an experience. To be honest, for most people, except your most loyal customers or frequent customers, the perception of the brand is just the assets and whatever you can have on positioning. But for people that have experienced the product or service already, that's also part of the branding. Right. That's when you truly can say, well, yeah, you walk the talk.

Yeah. So that kind of leads us into our next section for defining brand in a B2B context. So the first part that I wanted to discuss was brand as market perception. So kind of what we were just touching on, that your brand's not just your logo and your color palette, but it's what the market believes about you. What is your. Do you have a recommendation for listeners for kind of assessing and then building the market perception for their brand?

Yeah, I will say that again. Size dictates the. I'm gonna go physics here. The inertia of that perception. Right. If you are new, if you're small, if your target market or the number of people that knows about you is small, then you can be very flexible, very nimble. You're like a small boat. And if you want to change how you're perceived, it's very easy to do so. It's not that costly to change your logo, to change your colors, because while there's going to be some inertia on it, most people will quickly adapt to that. And that's similar to what startups do all the time with their pivot. And their pivoting is not only how they provide a service, but usually also they change their positioning and sometimes even change their logo and things like that. But as your brand grows larger, your company grows larger, then you start becoming a larger boat. A larger boat. And for some of those companies, you're almost like a Titanic. You really have a lot of inertia. So my recommendation there is that just because you say that you are now something different.

Yeah.

For most people, nothing had changed. You're still in the same direction. And if you keep changing your positioning, like all the time, you might get people confused. Right. So as you grow larger, consistency and being very mindful about the changes that you do on your position matters most or more.

Yeah. It makes me think of the B2C example of cracker barrels.

Yes.

Branding and that's also a example of how you have, you definitely have influence on your brand, but ultimately you don't have full control over your brand as

market perception because whether you wanted it that way or not, you start building the community around it. Right. It's you have more stake holders stand your investors at some point, your consumers, your employees. Right. Other market participants become part of the of what's at stake. So yes, it's a big responsibility as you grow larger.

All right, so then the second definition is brand as category positioning in B2B. Brand is also about where you live in your buyer's mind and what category you own and what problem your buyers know you for being able to solve. And that kind of makes me think of the example we've used in previous episodes of being a part of your buyer's solution set when they first think in their mind of the lists of brands that they know can solve that specific problem through are looking to buy a car. The first five brands they think of to solve that problem. What are your thoughts for branding as category?

Position, I think is that's a fascinating topic out of itself because there are at least two forces competing there. I believe one is there's this very natural tendency of companies to look at their peers just like we do with humans and saying, to what tribe do I belong to? To what, to what group do I belong? How can I position myself against others independent of my buyers? Am I a restaurant? Am I like a power tool? Am I you want to find a category. Am I an investing product or a consulting service? So you tend to gravitate as a company to finding categories that match others so you can find a place for yourself. Because this is the tricky part of branding is you want to be different, but you don't want to be completely isolated. You want to be able for other you, for you, for buyers to put you in a bucket so they can think of you. There's this strong need to find categories that you belong to. But at the same time, this is the part that is tricky is that from the buyer's perspective, especially for a buyer that is not as knowledgeable of the industry that you work on, they will not think of you in terms of the category that you belong to, but rather on the kind of problems you solve. And that's the part that where you can really find two ways of categorize or bucket your brand, if you want to call it that way, you can say, well, we are, if we use ourselves, we are in the marketing service category. If you want to call it or consulting services, similar things. But what are the problems we solve? We solve problems of companies having issues with their digital growth or even with digitally sourced sales, digitally sourced incoming inquiries because that's how sometimes our buyers will think about our services. I have issues with my digital presence. I have issues with my, with the number of opportunities that come to me instead of me knocking doors. They do not necessarily think oh, and that's the man as that's a demand generation agency. Because demand generation is more of something that we position ourselves to differentiate for the many, many, many marketing services firms that are out there. And we, we are the ones that are consistently building up what that category means. It only not only applied to marketing, of course applies to everything else. So I will say that you want to be mindful that will be kind of like the thought here that you make sure that you understand your category for against peers. How would you put yourself on directories classifications and all that. But don't forget that your consumers, your buyers do not necessarily think of you in those terms, right? They might be thinking of you in different terms or even confuse you with order categories even when they are pretty much the same. Something that is happening right now very, very clearly is that maybe for not sophisticated buyers, answers from Google are not different from answers from ChatGPT even when they clearly are different things. Right? Clearly, at least the traditional off service of you will classify as a search engine and you will classify something like an answer from something like ChatGPT as an answer engine or an LLM or AI chat. But for some users, they don't see a lot of difference because they're not aware of the differences on the technology. Right. If I see Google giving me answers, I see ChatGPT answer as well. They might not even have a name for the category. They will just in their minds bull lumped together Google and Bing and Claude and Perplexity into one big thing. That is where I can get answers or I can get recommendations or access to the web. So I think, I think that's important, right? That you're always mindful of what is the category that your buyer puts you in, which will be. You typically will be surprised. Is very different from how you define yourself.

Yeah. All right. And then last is branding for trust and risk, risk reduction. So a strong brand can really help reduce the perceived risk from buyers in B2B. Some examples of this are see when you have the customer logos on your website of people that you've helped, it gives that trust that if those companies chose you as a solution, then I can choose you as well. What are your thoughts for using your branding for risk reduction in B2B?

Yeah, I'll say that I might be lying here because I don't. It will be fascinating to go to the roots of how branding got created in the first place. But if I have to put a bet on it, I'm sure it has deeply roots on trust. Because if you think about it, if you think about before brands, you will work with an individual or with a company, with an organization and you have a ton of risks is first, can I trust this person that is going to do a great work and if I work with this person again, can they do it again at the same level? If I engage with someone that is part of the group, how do I know that I'm really dealing with a member of the group rather than someone that is impersonating this group or so imagine a blacksmith or a proto bank, a lender, right. And is giving you this piece of paper that says this many pieces of gold can be exchanged at any other place. How do you trust that person? Right? So I think branding came along as a way of putting together trust on something that is not just one person. That's what I'm trying to say, right? A brand represents a bucket or container where you can put trust reputation on something else than an individual. Because even that great blacksmith or craftsman, if he pass along his craft to his son or daughter, it might not be the same. And so companies have always done this that. Well, the way that we guarantee that repeatability is that we create processes, we standardize, we create a common experience. So you go to a McDonald's in Greenville, South Carolina and you go to another one in Peru. And while it will not be the same, you have a pretty good expectation of what is what you can get because the brand holds this idea that it doesn't matter what McDonald's you visit in the world, it's going to be around a specific kind of product and it will have a specific experience. And I think that's what, that's the, the main goal of a brand. All those assets, what they're trying to do is accumulate trust, accumulate reputation, good or bad, so you can leverage it so a stranger can have a business relationship with you, but you still trusting this entity that is beyond that specific person that is in front of the counter. I don't know if that makes sense.

Yeah. And I think that the level of perceived risk is higher for B2B sales than B2B2C because there's a lot more people involved in the buying process. And there's a level of when you're for a B2C sale, when you're buying something for yourself, you're really the only one that you have to answer to, the only one that you have to influence the decision or maybe a spouse or partner when you're deciding what car you're going to buy. Whereas in B2B it can be tied to where career. If you're for example, being a, a marketing agency, we're usually working with the marketing manager, marketing director of the company. And when they're deciding if we're the solution for them, they have their superiors, their C suite above them that they're, you know, that they have to answer to that not only might be involved in the decision, but their decision to choose us is going to be scrutinized by the C suite. So it feels like a lot more of a risky decision in B2B.

And truly it is. And I love you're saying that because one analogy that I can use is that one big difference between B2B and B2C is one of liquidity. Right? Is B2C because usually the transaction is smaller and therefore happens more frequently. Have more volume to judge. Right. So it's easier to evaluate the reputation and the trust of a company because you have way more transactions to look at. Right. There's more people that can tell you if they like the experience or not. Like when you buy a book or you buy a product, there's hundreds, tens of hundreds, millions of people that can vouch or had a bad experience with the product. And you learn fast in B2B because you have these large transactions that happens way less frequently. Your market doesn't have a lot of visibility. Right. There's a handful of people that will have the experience to tell you. Is fuzzier to know if you had success or not. Right. Usually you will be. It will be harder to get feedback because sometimes there's confidentiality behind. Right. Even the buyer itself doesn't want to be known as a buyer of the product or service sometimes. So that creates a lot of risk and as you said, therefore increases the need for more people to get involved to make and therefore you need to build trust among a larger group of people. So that's why building trust on B2B is so different from B2C because the way that you build brand changes because of that lower liquidity on transactions.

Yes. So talking about how branding can impact demand, the first way is that brand can shorten the sales cycle. And so jumping off of that perceived risk. A familiar brand can reduce the perceived risk of a B2D purchase. And it also requires less education as part of the sales process. I don't know what your thoughts are on that.

Yeah, I want to take a step back and kind of like use this section to remind our listeners how do I think about brand? Right. I'm not in the camp of you should do brand just because and never evaluate its impact on the business. But I also don't believe that if the only way that you're going to do brand is by connecting 100%1 direct attribution efforts to branding, you're going to succeed, you're going to stop it all the time rather is this middle ground. And the reason isn't there's a middle ground is for what you're saying most of the benefits of brand efforts and it doesn't have to be advertising only. But most of the benefits are strong brand are not directly seen. They can be correlated at most and actually show up on things that most leaders do not think about. As you were saying this a cycle. Right. One of the, one of the things that happened with a strong brand is that a better positioning will bring you better people or people that is more aware of your offer and therefore they will come if not completely convinced, at least more knowledgeable of what you offer. And the mere fact that you have that less convincing to do will shorten the sales cycle. And it has other benefits. Right. A stronger brand allows you to command a premium on your pricing, so your profit margins increase. And obviously there's a slight part which is if you have a stronger brand, more people should come your way and therefore more leads should get into your site or you know, your phone call, your phone or your chat, whatever channels you have a communication. But that's the probably the one that most people think about as to say well Brian, gotta show up somehow. And they only think about the volume of leads incoming and ignore these other benefits that you are covering. Right? Yes. The first one is reduce sales cycle. And there's a reason for that. The reason is you get more qualified incoming buyers. And even if they're not super qualified, the reputation of the brand makes the seller process easier to implement. Right. You have that leverage.

And then a flip side of that is that brand can also improve conversion rates for similar reasons. You know this, that people coming to your pipeline or more qualified to begin with or also just more aware of who you are and what you offer, they're going to move through faster and be more likely to convert.

Yeah, yeah. And we have explained the mechanism there in other episodes. But the way that it works is that all of us, most of the time for any product, category or problem, we have already a list of brands that we have in mind. And so when you are part of that decision set from the day one, this weird thing happens is that most buyers will pick from the decision set even if they evaluate, even if they add a fourth or a fifth. And those numbers have statistics behind them is the first one that we have mentioned is that 80% of the prospective buyers start with a list. That doesn't mean everyone has one. Sometimes it happens that you have no idea and then the usual path or the imagined path of let me go to Google and ask friends actually works. It presents brands for the first time to buyers. But more often than not that's not the case. You start with a set. And again, the other number that is very, that is mind blowing is that 80%, 85% of the time you will pick from your initial set. So there's a chance that if you're the fourth or the fifth, you will pick and it happens, but it's not common. So a stronger brand have that double benefit. Usually you are part of the set. And because you are part of the set, usually you are chosen. And that's how the increased conversion rates happen.

So thinking about how ways to measure the impact of brand on demand, it's not as clear of a attribution as demand generation is. The first metric that I think of is pipeline velocity. If your brand is having impact on having an impact on how quickly the deals are moving through the stages, as you know, your brand becomes more familiar. Are there any other metrics that you recommend kind of assessing to see the if there's improvement when you start brand efforts?

Yes, I think again here the important distinctions for leaders and the head of marketing, the head of sales, is that you want to have a metric that is more about alignment than actually compensation or recognition. Right. So something like pipeline I love as an alignment measure or measurement or KPI, but clearly the one that manages these sales, I wouldn't go and say that marketing should be evaluated 100% just on the strength of the pipeline because it's very fussy at that moment. Right. There's so many other factors that contribute to that, but definitely should be something that is like a North Star for both teams on buzzer measurement. But as you get closer to what marketing actually can influence, the first one that I believe will Belong to marketing is still a correlation, but at least it feels like it's yours. Is the number, the volume of incoming increase due to the brand, right? That's a strong indication if that number is increasing. Again, here is a correlation. You will struggle a lot if you want to get attribution directly for that. But it's something that if you have a baseline, you start some efforts, you can tie on time to that, right? And now if you want to keep going back and kind of like getting closer and closer to leading indicators, not lagging indicators, not outcome indicators, but some that will have a stronger attribution or a better signal to effort, then you can start thinking about brand search. That's a fantastic one, right? If there's a lot of people searching for your brand, that's great. And as you go back and back, you go to the sources, right? If my branding efforts are happening in the digital world, then I should have signals in the digital world. If I'm in social media, I should have more followers, more engagement, more conversations about me. You can even judge sentiment of them, right? Because it can be positive or negative. If you're doing efforts on search engines or answer engines, then you should be mentioned more, cited more. And again, there's a, there's a sentiment to it, right? It can be positive, it can be negative. And I imagine that there's a symbol to in real, you know, in the real world kind of efforts, right? You can evaluate that, asking people, having surveys. So that will give you the one that is the closest to to the source, but is the one that has the least business impact. And as you get closer to business impact, just be mindful that then you will have at best correlations and there will be way many other valuable variables that will be contributing to that. And it doesn't mean that you shouldn't have them, but they should be seen more as alignment KPIs rather than core KPIs for the marketing department, I believe.

Awesome. All right, well, I hope that episode was helpful for all of you. Any last takeaways from you, Amelia?

As we said in other episodes, experimentation, right? Great thing about all the things that we say nowadays, something that digital has enabled that it was possible before it, but it was very hard to do and super easy to do in digital is you can experiment, you can contest, you can defy whatever I'm saying right now and actually just do it for your company, right? Try some branding efforts, try some awareness campaigns, measure them and see the difference and you don't have to commit super large budgets to it. You can carve from your more performance sales activation activities. If you are having success with those and you should the Google will to say can I try this other thing and see what happens? And you will be surprised by the results. Obviously you can also go the route of look at these other companies, larger companies that have a strong brand and just compare things. I love to do this. You have heard me saying to clients, go to LinkedIn or any other social media platform where you are allowed to put your competitors, your perceived competitors and look at the largest ones and look at the level of activity that they do and probably you do as much. But because they have a larger follower base, they will have way more engagement than you. So size brings benefits. And so if you think about it is how can I have that level of engagement? Well, you have to be that big. And that starts by, by being present with more people. And that's branding, getting people to know you. So

awesome. All right, until next time. We'll talk to you guys later.

Thanks, it's been a pleasure. Bye bye.