22 Mar Industrial branding matters – a wake up call
There’s an intriguing report out from management consulting firm, McKinsey & Company, looking at consumer buying behaviours. Although this might appear to be of little interest to the industrial sector, in fact there’s a number of important parallels that we shouldn’t overlook.
Bear with me while I set the scene.
McKinsey reports that consumer brand loyalty is a commodity that’s rapidly declining. This conclusion is based on an analysis of a database of 125,000 consumers that buy from 350 different brands, covering 30 categories; these include cars, telecoms, food, holidays, computers, cosmetics and shoes.
The results show that brand loyalty was strong in just three of these categories: mobile carriers, car insurance and investments. In every other category, just 13% of consumers exhibited strong brand loyalty – the remaining 87% are essentially ‘shopping around’ each time they made a purchase. Of these, 29% ultimately returned to their original brand, while 58% purchased another brand or brands.
McKinsey makes the point that it is ‘vital to be included in the set of brands that first come to a consumer’s mind when he or she is triggered to make a purchase decision. Those brands in the initial consideration set were more than two times as likely to be purchased as were brands considered only later in the decision journey’.
In other words, strong brand recognition, including an understanding of a brand’s benefits and values, is critical not just at the start of the customer journey, but all the way along the road from the initial need or desire to the final decision to purchase, and then subsequently to repurchase. Those companies, according to McKinsey, that are most successful are those which find new ways of boosting brand awareness and then take an innovative approach to converting awareness to serious brand consideration across the buying cycle.
Industrial branding: engineers are consumers too
This brings me back to our heartland: the industrial sector.
Traditionally, brand is not a word that’s used widely in industrial marketing, especially among SMEs. In recent years in particular, the focus across the board has been on sales leads and demand generation, rather than on industrial branding, developing market awareness or guiding customers along the journey from awareness to purchase.
The McKinsey report, however, should make us pause for thought, as what happens in the consumer marketing space invariably filters down into the B2B sectors.
Our target audiences may be defined as engineers, designers, technologists, scientists, company directors or procurement specialists. Yet each of these is made up of individuals who think and act as consumers. They are emotional as well as rational people; they have the same biases, feelings and triggers as any other consumer.
Although industrial buying cycles may differ from those in the consumer space, our audiences essentially react in similar ways to the world around them. They are just as likely to shop around, especially given the ease with which this can be achieved on-line, but can equally become loyal to strong industrial brands that work hard to build an affinity with them.
Understand the industrial buying cycle
Key to this process is the ability to understand the customer journey and buying cycle; to create a strong industrial brand presence in both on- and off-line spaces; and to develop the tools that capture the attention, interest and desire of engineers, buyers and specifiers.
This approach may require a different approach to marketing and business development – certainly, it demands a longer term outlook than is normally associated with demand generation campaigns. Instead, an industrial brand has to be developed over time to ensure that each audience understands the brand message – what the company does, what it stands for and why it’s different – and subsequently identifies with the business so that it is considered at the outset of each new purchasing cycle.
An important element in this process is the deployment of an effective content marketing strategy, providing the insight, ideas and inspiration that lead to thought leadership positioning and competitive differentiation. Remember that over 60% of each customer journey – even in the industrial and B2B sectors – is completed before a potential supplier even knows that the customer exists, or is in the market for a new purchase. Ensuring that your business is found, considered and included in any tender or RFP depends on high quality, engaging content that truly reflects your brand, in terms of identity and personality.
To learn more about the customer journey, industrial branding and ways to build a sustainable brand, engagement and demand generation programme, please download our white paper.