B2B marketing is at a tipping point. As budgets tighten, marketers cling to demand capture and neglect brand. But new research reveals this imbalance has become a serious drag on the industry. Kandace Barker of Initiative (part of IPG Mediabrands) explains why it’s time for a rethink.
‘When you only chase the minority of buyers who are ready to purchase today, you’re effectively ignoring the majority who will buy tomorrow,’ explains Barker (Aron Visuals/Unsplash)
The B2B sector is standing at a crossroads. In a climate of economic uncertainty, many marketers have gravitated toward lower-funnel performance tactics, chasing quick returns over longer-term brand building.
At face value, this makes sense. When chief finance officers ask for results, performance channels deliver numbers you can see in a dashboard. But this investment in performance has come at the cost of long-term brand building.
Initiative’s recent research with YouGov and Google Trends found that while brand-building receives less than one-third of B2B marketing spend, it’s actually the stronger driver of commercial outcomes.
The report also showed that fame (brand-building) is 24% more correlated with purchase intent than flow (demand activation). In short: brand drives demand. And without it, the funnel will eventually run dry.
Advertisement
It’s easy to see how we got here. Challenging trading conditions have made it seem like every marketing dollar has to prove itself twice, and conversations inevitably turn to ROI.
Almost half of digital marketers (46%) now have budget allocation discussions at least once per month, and more than half (58%) need ROI to validate their spend and get approval for future budget requests.
The impact of lower-funnel marketing activation is also faster and easier to quantify than brand marketing – from engagement to purchase data. All of which helps explain why many B2B companies end up allocating 70% or more of their marketing budgets to short-term activations.
But the reality is that the majority of B2B buyers are not in-market at any given time – meaning that most future customers won’t click your lead-gen ad this quarter. When you only chase the minority of buyers who are ready to purchase today, you’re effectively ignoring the majority who will buy tomorrow.
Our research shows that 86% of B2B buyers already have their consideration set on day one of the purchase journey, and 92% will purchase from that shortlist. So if your brand isn’t famous before the funnel starts, it’s already too late.
We analyzed 60 B2B brands across technology, telecom, consulting, benefits, and marketing services to uncover what truly drives purchase intent, identifying eight key drivers of growth. They’re the ‘f-factors’: familiarity, favorability, feeling, fervor, findability, facilitation, fascination, and following. Together, these give marketers a clear line of sight between communications activity and commercial impact.
The results were clear: feeling (mental availability) and favorability (trust and likability) are the two most powerful predictors of purchase intent. Together, they outweigh short-term lead generation by a wide margin. Fame gets you on the shortlist, and flow helps close the deal.
And the nuances matter. Millennial buyers now form the majority of B2B decision-makers. They respond to social consensus and belonging. For them, fervor and following (word of mouth, community, and social validation) matter most.
Advertisement
At the same time, today’s execs prioritize relationships and credibility – the ‘following’ factor.
And enterprise buyers rely on group consensus, making facilitation (ease and clarity across the journey) a key flow driver.
B2B has evolved faster than most marketing models have kept up. Buying committees are bigger. Sales cycles are longer. Decision-makers are hybrid, digital-first, and more informed.
But the way we build awareness and trust hasn’t evolved at the same pace. Focusing only on flow delivers diminishing returns. And without sustained fame, your lower-funnel tactics eventually cost more and convert less.
Advertisement
Our research also shows that brand strength accelerates awareness as well as performance. A distinctive brand builds trust and lowers price sensitivity. It makes buyers more receptive when your flow tactics appear later.
So how do we rebalance? It starts with an audit of where your brand is over- or underperforming. Is your content driving awareness, but not engagement? Are your CRM efforts converting but failing to build an emotional connection?
With a unified set of metrics, brand and demand can finally work together. From there, the path forward is practical. Firstly, reframe brand as a revenue driver, not a cost center. Build shared metrics with finance and sales to prove long-term value. And design media architectures that nurture both fame and flow touchpoints across paid, owned, earned, and shared channels
Lastly, and above all, invest in creativity – because emotion, storytelling, and cultural relevance are still the most underutilized tools in B2B.
IPG Mediabrands
IPG Mediabrands is the media and marketing solutions division of Interpublic Group (NYSE: IPG). IPG Mediabrands manages over $47 billion in marketing investment...
