A tale of disruption, death of a salesman

Marketing spend is on the rise.  For the past three years, B2C and B2B organizations have increased the amount they spend on marketing as a percent of revenue by 7% 1.  Confirmed by Gartner, most organizations reported an uptick in spending for marketing, 7 to 8% increase over prior years 2.   Does this mean life is easier with more marketing support or death for all the Willie Lomans out there?

Today’s benchmark for marketing spend today is 8 - 12% of revenues, depending on the type of business, size and growth stage.  This increase over the historical 5 - 7% in spend is due primarily to the change in buying behavior, known as the buyer’s journey.  

Today’s B2B buyers complete 57 to 70% of the journey before engaging a seller; that’s right, two-thirds of the journey is completed before the buyer engages a seller.  For many B2C and SaaS companies, the journey is nearly 100%.  Half of all consumers under 50 check references using the web before buying. 3

72% of B2B buyers start their journey using Google, not the yellow pages 

48% of B2B buyers report purchasing goods directly from supplier sites 4

46% of respondents expect to increase their online purchasing next year

41% feel comfortable purchasing any type of product category online

In response, market leaders are moving to digital channels for marketing and sales.  Amazon is winning the retail war.  Giant GE has put its catalogs online.  Auto and truck fleet sales are conducted entirely online today.  Services such as insurance and finance have moved out of the agent’s office or bank and on to internet; it’s never been easier to discover, evaluate, compare and decide upon which financial offering suits you best.

Does the rise of digital engagement mean death for Willie Loman and other sales personel?  Not yet, but Forrester Research forecasts 3.5 million B2B sellers in 2020, down from  the 4.5 million in 2012. 5

So what does this mean for your organization?  Allocating people, time and money is often a zero-sum game.  Upping the spend on marketing may not feel as comfortable as hiring Willie Loman and assigning him a quota.  Spending on marketing that improves the buyer’s journey, provides insight to you and the buyer, and makes the transaction easier to complete is an essential step in the right direction.  Establishing clear roles and rules to govern activities is another essential step.  Linking metrics to rewards that align those roles and rules is the key missing ingredient many operations miss.  Ascendiosa can help.



1. http://www.webstrategiesinc.com/blog/how-much-budget-for-online-marketing-in-2014
2. Gartner for Marketers 2017, pg. 4
3. http://www.pewinternet.org/2016/12/19/online-shopping-and-e-commerce/pi_2016-12-19_online-shopping_0-02/  December 16, 2016
4.https://blogs.oracle.com/cx/entry/2013_b2b_commerce_survey_insight
5. Forrester Research as reported in https://www.internetretailer.com/trends/b2b-ecommerce/massive-downturn-ahead-jobs-b2b-sales-reps/

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