Insight

1 – Why do B2B Brands?

Competition makes it so because of customer value. Businesses today face a great challenge: Homogenization!

In a fiercely competitive global market, suppliers must offer high-quality products to succeed. But when product quality is similar across the board, how do buyers decide and how do sellers create more value that supersedes the industry standard to attract more buyers? It’s a challenge for everyone involved when quality alone isn’t enough to make a choice.

Brands play a crucial role in guiding buyers towards better decisions by offering more than just basic product features. They focus on values like trust, innovation, and emotion, fostering trust in B2B brands.

In today's competitive landscape, both in B2B and B2C sectors, branding is essential for driving growth. It leads to increased customer acquisition rates and greater efficiency in acquiring new customers.

Regular customers develop loyalty to the brand, leading to repeat purchases because they trust the company's products for their reliability and timely delivery. Additionally, satisfied B2B customers are more likely to recommend the brand. When encountering new markets, channels, or geographic locations, branded products have higher penetration rates. 

In the hyper-competitive era, both B2B and B2C companies grow organically through brand-driven mechanisms, including customer retention, repeat purchases, and market expansion.

2 – Why do B2B Branding Matters More Than It Used To?

In the modern digital age, the buyer's purchasing journey and the criteria for evaluating product brand value are undergoing significant changes.

In the traditional B2B landscape, personal sales interactions, face-to-face meetings, tailored proposals, and quotations played crucial roles in establishing brand value. Trust was primarily built through human interactions, particularly with sales representatives and teams. However, in today's digital era, the buying, delivery, and evaluation landscape are being reshaped by digital intelligence.

Three major forces are shaping the decision-making process of B-side buyers: Social Networks, E-Commerce, and Digital Transformation.

Social networks play an important role in the pre-purchase phase. Before buyers decide to purchase, they will extensively research product categories and compare options. Consequently, when buyers ultimately make a purchase, they are essentially finalizing a transaction that was largely informed by their previous screening and research done on social networks. 

How is brand awareness education accomplished within social networks? There is user-generated content (UGC), professional-generated content (PGC), and now there is also AI-generated content (AIGC), all which provides resources for companies to evaluate, identify and understand products, brands, categories, merchants, and timing of purchase they are interested in. The content on social networks serves as a great basis for B2B buyers to formulate brand preferences and make decisions.

As a result, B2B buying has shifted from relying primarily on salespeople and personal relationships to relying on the “trust intermediary,” namely the brand. Through brand building, sellers’ products, and sellers themselves can more efficiently attract buyers to make decisions.

In the current B2B landscape, branding has evolved to serve a role akin to that of a salesperson, becoming a crucial factor in the decision-making process for B-side buyers. This marks a significant shift in B-side purchasing behavior in the era of digital intelligence.

Based on Kotler Consulting's interviews with nearly 400 B-side companies conducted over the past 6 years, as well as a meta-analysis of research literature on B2B branding in academia spanning the past 15 years, we have concluded that the importance of B2B branding lies in the significant perceived value it provides to both buyers and sellers. 

For buyers, a B2B brand means higher trust, less risk, more certainty, and increased satisfaction. 

When collective decisions are made internally (many B2B purchases involve committee decisions), it’s easier for decision-making committees and the procurement teams to come to agreement. This is because the streamlined decision-making process increases trust, ultimately reducing overall procurement costs. 

Additionally, as users, using branded products enhances the company’s image and reputation (for example, end customers will feel more satisfied and perceive higher value, which in turn boosts personal brand image). Therefore, the value it brings to the buyer comes in the increased certainty, return on investment, risk reduction, faster decision-making, and minimize overall ownership costs.

Branding offers sellers the opportunity to differentiate themselves from low-priced competitors, bringing several key benefits:

·       Continuously attracting top talent and quality partners.

·       Accurate fulfillment of buyers' needs.

·       Unique modes of delivery, service, and usage.

·       Efficient pre- and post-sales experiences, facilitated by better and more efficient distribution partners.

·       Increased goodwill.

·       More loyal customers, leading to higher repurchase rates.

The reason why we should build B2B branding is very simple – to allow buyers to better identify us, form long-term relationships, assist them in making better decisions, and ultimately generate higher returns on investment through brand building.

3 – What is B2B Branding?

B2B branding is the process by which a company continues to deliver its value promise to customers through products, services, communications, and experiences.

It is very important to understand that the process of branding is not a one-time event like an advertisement, registering a trademark, a pop-up video, or organizing a brand launch. It is a continuous process of improving the entire systematic approach around the core appeal to buyer’s values.

We need to remember three things which constitutes the fundamental differences between brands and products:

Firstly, the product itself must be of exceptional quality, delivering outstanding results to solve the customer’s problem. In B2B, the effectiveness and user experience of the products will significantly impact the customer’s return on investment (ROI). Within the B2B industry, ROI serves as the most important decision-making basis for purchasing.

         1^st Cornerstone: Leading Product

A product that continues to innovate, addresses the critical needs of core customers, and facilitates their ongoing success.

         2^nd Cornerstone: Customer Utilization

Customer success is paramount, extending beyond mere product transactions. To transcend the role of a seller and become a brand, companies must shift their mindset. Merely selling products marks the beginning of a journey, not its culmination. Establishing a brand identity requires prioritizing customer service and offering value-added services, distinguishing the brand from simple product sellers.  

3^rd Cornerstone: Higher Purpose for the Long run

Beyond short-term profits, brands should prioritize delivering superior products and fostering high levels of trust. Additionally, businesses should have a broader mission and vision aimed at improving the world and enhancing the well-being of stakeholders, including employees, suppliers, and communities. This higher purpose adds depth and meaning to the brand's identity.

One of the ultimate goals of business is achieving “branding,” which is the highest level of reward for operational excellence and stands as the crown jewel in marketing endeavors. Customers recognize a brand's value through indicators like higher premiums, increased loyalty, more frequent purchases, and referrals to new customers. Companies need to align their brand communication, decision-making, and equity building closely with the decision-making path of B-side buyers.

4 – How to Build a B2B Brand?

On the B-side, there are both complete products and intermediate products. Buyers purchase products primarily to either complete their product offering, enhance competitiveness at the end, or to minimize overall costs.

When businesses buy products, they're thinking about the overall cost and how much benefit they'll get from using them. So, in B2B (business-to-business) transactions, where expertise and saving money are big factors, companies need to make their brands easy to choose and focus on things that matter to buyers. (Align it with the 5A customer path)

The core purpose of B2B marketing is not just to generate interest, but to help buyers establish relevant knowledge and set standards for purchasing B2B products.

Unlike B2C brands, which focus on creating interest aka “planting grass,” B2B brands need to “plant trees” to build thought leadership in their field. “Tree planting” is the process where B2B companies provide helpful information and services to help guide potential clients to make informed decisions about their problems, preferences, and product choices.

Grassroot Marketing typically includes various tools and content, such as white papers, user case study videos, professionally generated content (PGC), key opinion leader (KOL) reviews, new product launches, ecosystem conferences, user conferences, and more. These help buyers set their purchasing standards and marketing content systems.

In B2B brand building, companies must understand their customers even better than the customers understand themselves. By working together to create value, and help customers succeed in their competition. Only then can B2B companies move beyond transactional relationships and enter deeper, long-term strategic relationships.

Therefore, we will focus on:

·       Firstly, the brand needs to have a grand vision.

·       Secondly, there should be a systematic and in-depth content system for tree planting.

·       Thirdly, tell customer stories, using their success to prove and inspire the brand’s vision, and integrate it into the customers’ purchasing journey.

5 – Principles of Branding for B2B Companies

Kotler Consulting has helped a lot of B2B companies with their branding, and I have summarized them into these 5 principles to share with you.

1.       Emphasize on Professionalism (Expertise) and Focus (Dedication)

In B2B, it's all about continuously improving with customers to make them more competitive, focusing on long-term relationships. Highlighting long-term success and ongoing improvement shows dedication and professionalism, which are key to building trust and loyalty.

2.       Standout Uniquely

The current challenge for businesses is the risk of becoming too homogeneous. From products and features to packaging and sales strategy, everything starts to seem alike. To stand out, focus on what makes your brand special. What is the unique selling point. This uniqueness stems from understanding user stories and their specific needs.

3.       Share the Brand Story

Share the narratives of the brand, enabling customers to link the brand logo with its story, product features and applications. This fosters a deep emotional connection that strengthens customer loyalty and enhances brand value.

For instance, Kotler Consulting worked with a B2B flat panel display company with excellent products but lacked a compelling brand story. As a result, their customers were only willing to pay average prices, highlighting the importance of creating added value through effective brand storytelling.

4.       Right Values

In today's world, having the wrong values can spell trouble for businesses. Nowadays, we focus on diverse values such as environmental protection, sustainability, helping vulnerable groups, and upholding ESG principles. As a brand, it is important to commit to long-term objectives that contribute positively to society through our business and products.

Many B2B companies are prioritising initiatives like ocean protection, plastic recycling, and sustainable packaging. These efforts not only have social value but also align with their core business. We must avoid activities that are unrelated to our core business, as unsustainable endeavours can dilute our credibility. True brand values are the ones that fit seamlessly into how we do business every day.

5.       Create Memorable Experiences

In building B2B brands, advertising takes the backseat. Instead, it’s mostly about word-of-mouth which comes from customers having great experiences and sharing them. For Chinese companies to succeed in B2B, they need to showcase their global brand story using data, real examples, customer success stories and values.

By continually improving the user experiences, providing customizable features, and delivering top-notch products, companies can expect to earn high reviews from customers. This, in turn, motivates them to spread their positive experiences, solidifying the brand’s reputation in the B2B world.

Allow me to conclude with a classic closing remark from Mr. Philip Kotler (Father of Modern Marketing): "If you're still doing the same business in the same way after five years, you're not far from closing the doors for good."