DemandGen Report - The New B2B Purchase Path

The New BtoB Path To PurchaseWith an expanding menu of information and options available at their

f ingertips, new research reveals BtoB buyers are increasingly bringing their

consumer buying patterns into their selection process for business solutions.

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Whether its ordering a pizza or shopping for a car, the

majority of purchases now start online with buyers

researching and exploring their options and selecting

the option that best fits their budget and needs.

This web-first buying pattern has transformed

consumer shopping, but new research reveals these

behaviors and expectations are quickly shifting to

BtoB buying.

The 2011 Inside The Mind of the BtoB Buyer

Survey, conducted by DemandGen Report, revealed

that business buyers are now looking for the same

convenient ability to easily sample new products and

flexible pricing models they are utilizing as consumers.

Based on responses from more than 230 BtoB

buyers that have been involved in the purchase of

a solution in the last year, the survey found fewer

business purchasers are sticking to traditional budget

restrictions or sales engagement. While the survey

data from 2010 had pointed to a significant shift

in BtoB buyer behavior, the 2011 survey showed

business buyers are looking for even more control

over the purchasing process.

Illustrating these “consumerized” buying

trends, the survey revealed that more

BtoB buyers were starting to do more

competitive window-shopping and moving

ahead with unbudgeted purchases:

� 83% of the BtoB buyers surveyed

said they started their purchase

process with informal research;

� Only 27% had budget for the

solution/project approved and

allocated at the beginning of the year;

� 21% of respondents said they

determined their budget only after

multiple bids had been gathered, an

8% increase over the prior year;

� 16% said they took budget

from another line item after they

established a clear need/benefit for

a solution, an 8% increase over the

prior year.

The following white paper will highlight the

key trends that emerged from the second

annual BtoB buyer survey and provide

solution providers with insights into how

they can effectively engage the increasingly

connected and empowered BtoB buyer.

BUYER DIRECT

Many of the trends that emerged in the

inaugural Inside the Mind of the BtoB

Buyer study continued to evolve with the

2011 data, as buyers continue to dictate

the terms of engagement with solution

providers. Illustrating this trend, less than

7% of buyers said they connected with the

solution provider via a cold call:

� 41% said they contacted the solution

provider directly

� 46% said the solution provider

contacted them only after they

requested more information from

their web site

“A lot of this is vendor-driven,” said Matt

West, VP of Marketing, Genius, which

helped sponsor the BtoB Buyer survey for

the second consecutive year. “Most savvy

organizations no longer rely on the cold call

mentality. A lot of companies are utilizing

things like marketing automation, lead

scoring and behavioral tracking, and really

know who’s most interested in nurturing

through the process. So by the time that

2 • A DEMANDGEN REPORT WHITE PAPER

27%

How would you describe the budgeting/approval process for this recent solution purchase (2011 DATA)?

Budget for project was approved and allocated during beginning of the year

Budget was allocated as part of a larger line item once need was established

Budget was determined post multiple bids

Budget was taken from another line item after need was established/clear

Determined potential impact through other adopters and built a business

26%

21%

16%

11%


connection is made, it is inbound or by

the time that outbound call is made it’s to

that select group of people who have been

nurtured through the process and have

exhibited buying interest or intent.”

This trend of the buyer taking control of

the purchase process actually expanded in

2011, demonstrating the growing challenge

for BtoB salespeople to influence early-

stage buyers. Illustrating the increasingly

buyer-controlled process:

� 41% said they engaged with a

sales representative only after their

initial research was conducted on

various options;

� 24% engaged with sales after a

preferred list of vendors

was established;

� Only 21% engaged with sales

immediately when they started to

research solutions;

� 7% engaged at the point of

distributing RFPs; and

� 6% engaged when they were ready

to negotiate terms.

At what point in the buying process did you engage with sales representatives from solution providers?

41%

24%

22%

7%

6%

2%

After initial research was conducted on options

After preferred list of vendors was established

Immediately when research began

When we put out RFPs

When we were ready to negotiate terms

Other


Small Businesses Self-Navigating The Purchase Process

Small to medium size businesses (SMBs) are self-navigating the purchase

process at a more dramatic rate than their larger or enterprise-grade

counterparts. From decision-making to the considered usefulness of resources,

the survey found the following contrasts in the way organizations of different sizes

navigate the purchase process:

� Only 13% of small business respondents indicated that their budget was

approved post multiple bids, compared to 20% of large companies.

� 43% of small business respondents said they engaged with sales reps

only after internal search was conducted on options, compared to 34% of

larger companies.

� 53% of small business respondents said their first point of contact with the

sales rep was made only after they asked for further information on their

web site, compared to 34% of larger organizations.

� Nearly all of small business respondents (93%) started with information and

research gather around a business problem in the early stages of the buying

process, compared to 76% of larger companies.

� 79% of small business respondents found demos/product overviews

most useful in the early stages of the buying process, compared to 65%

of larger companies.

� 76% of smaller business tapped a free trial to use the product before

purchasing, as opposed to just 32% of larger companies that took

advantage of a free trial.

� 74% of small business respondents cited free products or trials as the most

helpful in supporting their decisions, compared to 29% of larger companies.


While the 2010 survey indicated that BtoB

buyers were relying on a wide circle or

network of peers for feedback and input

into their selection process, the 2011 data

pointed to buyers reining that in looking for

direct access to how products and solutions

would fit and their organization.

Illustrating this shift to more direct research,

only 36% of buyers said they relied on

multiple sources in making their vendor

selection, compared to 48% last year.

According to this year’s results, more buyers

are going directly to vendors after in-depth

research of specific solutions. Rather than

researching more sources to feel out different

options, majority of respondents indicated

they were looking more into specific vendor

content and information to determine the

company value of a solution. By providing

a vast number of resources such as white

papers, E-books, webinars, case studies and

product demos, vendors can provide buyers

with a more hands-on, “under the hood”

approach to size up solutions first-hand.

Product overviews and demos were the

resources respondents found useful in the

early stages of the buying process. A majority

of buyers (70.9%) utilized the resources,

while 44.2% were attentive to content such

as white papers and E-books to obtain

solution information. Similarly, while buyers

found case studies (40.6%) and webinars

(34.5%) helpful during the decision-making

process, other tactics, such as videos

and blog postings, had less impact on the

contact initiation with sales reps.

More than half of respondents indicated that receiving product

information upfront via demos and product overviews were the

most useful in the early stages of the buying process, cited by

71% of buyers.

Which resources did you find most useful in the early stages of the buying process?

10%

Other

16%21%

35%41%

44%

71%

Blog PostingsVideos

Webinars

Case Studies

White Papers/E-books

Demos/Product Overviews


More than half of respondents indicated

that receiving product information upfront

via demos and product overviews were

the most useful in the early stages of the

buying process, cited by 71% of buyers.

While the survey showed case studies and

tools that support the ROI justification for

the project are now established resources

for buyers, the majority of respondents

(58%) said they are most interested in

vendor comparison analysis.

The interest in “test driving” solutions

continues throughout the buying cycle,

according to the survey, with 56% of later

stage buyers stating they found free trials

and online demos to be most helpful in

supporting their decisions.

The Emergence Of The Agile BtoB Buyer

The findings of the 2010 edition of the

survey honed in on the emergence of social

media as an educational tool. But the 2011

study found that buyers are progressing

and adopting consumer browsing

and decision-making behaviors. This

“consumerization” has gone into hyper-

drive in the last year, making companies

leverage social media channels, content

and demo offers in addition to standard

sales and marketing tactics.

The 2011 survey revealed that flexibility

is essential and expected from buyers

more so than ever. In turn, areas such

as budgeting and finalizing purchasing

decisions have grown more nimble, making

the buying process more casual than the

traditional BtoB funnel.

“It’s clear that budget hasn’t gone out the window, but it’s

not necessarily a driving force.”

- Matt West, VP of Marketing, Genius

In the later stages of selecting a vendor and rolling out the product or solution, which tools did you feel were most helpful in supporting your decisions?

12% 12%

24%27%

56% 56%

Other

Video Testimonials

ROI Calculators

Assessment Tools

Online Demos

Free Products/Free Trials


“It’s clear that budget hasn’t gone out the

window, but it’s not necessarily a driving

force,” West said. “As a seller, you don’t

need to get that involved early in the

process. You definitely need to be top-

of-mind, but it’s not like there’s a buying

season and you can miss it. It’s more like,

if there’s a need, they’ll find the budget

to buy. Also the authority aspect is gone.

A lot of times people are making small

departmental purchases or purchasing

products on their own or within their small

team within an organization.”

While BtoB buyers are more flexible

and open to shifting budget, the survey

revealed that they are still risk averse and

looking for solution providers that can help

them confidently demonstrate that will

serve their unique needs.

Highlighting this growing trend of proof

of concept, with more buyers piloting a

solution in one department/division before

rolling it out company-wide. More than

30% of respondents deployed this tactic,

while 23.6% hired a consultant or market

expert to assist in vendor selection and

overall rollout.

“The smart companies are learning more

about the impact of offering solutions on

a departmental level with that ‘land-and-

expand’ mentality,” noted West.

The Softening Of Social Media Influence In Buying Decisions

One channel that showed a surprising decline in influencing purchase decisions among

BtoB buyers was social media.

In 2010, 65% of BtoB buyer respondents indicated they used social media in their

buying process. In 2011, that number dropped to 35%.

“Obviously social media is here to stay, it’s in its infancy still in terms of where it is

going to go,” West said. “But I think the novelty aspect of rolling it into business-making

decisions is kind of gone, and people are a lot more practical about it.”

West noted that since social media has become such an innate, every day behavior,

buyers are looking for more direct sources of information. Furthermore, this quick-shift

change in buyer behavior may reflect that companies may not need as many sources to

find the ideal solution for their business goals. As a result, vendors should focus on their

provided content and messaging, demo opportunities and price options.

About The Survey The Inside The Mind of the BtoB Buyer Survey includes feedback from more than 230 respondents

actively involved in purchases a business solution within the last 12 months.

A majority of survey respondents (61.5%) were active marketing team members, while 9.6% came from

marketing operations; 9% were sales personnel and 3.8% handled sales operations. Less than 2% of

respondents were from IT departments (1.3%) and CRM administration (1.9%).

Although marketing was the leading department involved in developing a vendor criteria and seeking

necessary solutions, participants came from a variety of verticals. Key markets included high-tech/

software (37%), professional services (21.4%), financial services (8.4%) and healthcare (5.8%).

Similar to last year’s results, all survey respondents were active in the buying and decision-making

process. A majority (56.4%) of respondents indicated they were key influencers in developing a

need for a business solution, while 44.8% were final decision makers in implementation, 44.2%

recommended project guidelines/vendor selection criteria, and 18.8% were buyers that noted

approving and allocating budget.

The leading deployment strategy for this year’s respondents was implementing a product or solution

for a specific department (69.7%), while 23% formulated a pilot project before finalizing a company-

wide roll out.

Although one-third of survey contributors were with organizations of less than 50 employees, 26.3% of

respondents were from companies of 100-749 and 23.7% had a worker count of 750-2,500.

The 2011 edition of the study attracted primarily organizations with less than $10 million in

average revenue (35.5%). However, respondents were more widely dispersed in company size,

with 27.1% citing revenue of $10-$50 million and 16.8% taking in $50-$250 annually. Furthermore,

more than 10% of respondents indicated

that their company generated more than

$1 billion in overall revenue.


36%

27%

4% 7%10%

17%

There were over 230 respondents involved in a BtoB purchase who responded to this survey.

$500 to $1 billion

$250 million to $500 million

$1 billion and above

$50 to $250 million

$10 to $50 million

$Below $10 million

ConclusionThe array of resources provided by the Internet has allowed sales and marketing personnel to

develop partnerships with prospects via social channels. But the powers of the web also have

increased customer resources to conduct in-depth research on solutions that will give them

the most bang for their buck.

Despite the direct nature of social channels, vendors should no longer depend on them to

spread the world about their solutions. Findings indicate that social media does not hold as

much weight on buyer’s decisions, opinions and actions.

Buyers will gravitate toward solution providers that demonstrate their value proposition by

highlighting key problem solvers with in-depth content, as well as flexible pricing and trial

methods that can help them make a more informed purchase decision.


About GeniusGenius provides powerful, yet easy-to-use automated marketing solutions that enable

both Marketing and Sales users to quickly identify and connect with their best pros-

pects—instantly. The powerful Genius cloud computing infrastructure delivers automated

marketing, including lead generation, email marketing, and lead management with instant-

on availability, so you can deliver and track your marketing activities in minutes.

Genius.com® Incorporated™ 1400 Fashion Island Boulevard

Suite 500 San Mateo, CA 94404 1-888-6-Genius [email protected]

www.genius.com

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About DemandGen ReportDemandGen Report is a targeted e-media publication spotlighting the strategies and

solutions that help companies better align their sales and marketing organizations, and

ultimately, drive growth. A key component of our coverage focuses on the sales and

marketing automation tools that enable companies to better measure and manage their

multi-channel demand generation efforts.

For more information please visit www.demandgenreport.com.

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DemandGen Report - The New B2B Purchase Path

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