Recent primary research has shown B2B organizations plan to move their brand activities into new industries and geographies during 2021, but a big question remains – are their marketing and PR agencies meeting those plans? In this article, Jamie Kightley, Head of Client Services at IBA International, analyses the research and explains how, in a period of economic recovery, B2B organizations are looking for marketing and PR agencies that will complement potential expansion plans and adapt to new B2B marketing needs.
The combination of COVID-19 and Brexit is expected, according to industry ‘experts’, to have a huge impact on the economies across the globe, even suggesting that those industries which might emerge untouched by the pandemic such as pharma and technology will likely be negatively impacted by Brexit . But at IBA we are hearing a different story. Our client base of B2B companies based across NA, Europe and the UK have suggested no such gloom and doom.
So we opted to carry out some primary research of our own using CINT, a market research technology company that operates the world’s largest sample exchange – the results found an entirely different outlook from businesses regarding 2021. Our research, focused on B2B organizations based across the U.K., North American, Australia and New Zealand vertical markets and who spend between $5k and $40k per month on marketing support, conducted during August and September, highlights a stark difference to the dismal projections seen all too often in the media.
B2B businesses persevere despite external challenges
The IBA research showed that some 86% of marketers responded to the pandemic lockdowns by “developing new products and testing new marketing formats” A number of businesses decided to look internationally. Over a quarter (26%) of respondents stated they are opting to venture into new geographies while a further 28% are seeking to enter a new industry.
Also, as part of their Brexit response, our findings suggest many B2B organizations would consider proactively expanding internationally – with a significant pre-requisite being favorable U.K. and E.U. trade arrangements and low tariffs being introduced on the sale of products.
But here’s the catch: 45% of B2B organizations were forced to cut their marketing spend and only 11% of marketing managers are satisfied with the activities of their current agencies. When pressed with more detailed questions, many admitted they felt that their agencies failed to support their organizational expansion goals.
What are B2B organizations looking for in their ideal agency?
A finding that should trouble marketing agencies large and small is that 40% of marketing managers admitted through the survey they find it difficult to measure the contribution of their PR and marketing agencies to their overall business activities. Over one third (34%) of those surveyed felt that the agency servicing their business is ineffective for their operations as the agency places content in the same small selection of media. But it is not just the same small selection of media that is a concern, a further 41% of businesses believe that agencies place too much focus on high levels of media engagement with the journalists they already know – at the sacrifice of content placement metrics.
Our research uncovered that only 27% of businesses feel overwhelmingly satisfied with the quality of service they received. Combined this with the finding that 38% of marketers struggle to find agencies who would work affordably across multiple geographies, and the result is crystal clear: agencies need to change the way they charge for their services.
When budgets are tight, high costs are the last thing businesses need
The research project focused on a selection of marketing managers who spend between $5k and $40k per month on marketing support, with the majority spending between $10k and $20k, but 30% of marketing managers feel that agency cost outstrips all returns. A fact emphasized by the managers who feel the cost of retaining a public relations agency is the biggest impediment to global expansion.
Furthermore, 88% of respondents feel a large portion of their agency spend is wasted – the traditional agency outlook is less than rosy for managers wanting to see the expansion of their campaigns on a global scale.
Agency changes – teaching the old dog, new tricks
A big source of marketing managers’ criticism were the flaws of the ‘old school’ agency system. A third of respondents believe that their budget is wasted because of unnecessary status/progress calls as opposed to trying to achieve measurable results. A further 21% stated they felt pressured by senior management figures to work with well-known agencies, even those who do not align with their organizational goals. Overall, the figures and statements clearly show the traditional agency model is failing to instil confidence within those marketing managers who are in the process of seeking market expansion.
A further 24% of marketers admitted to feeling undervalued by their respective agency as a small spend account. Additionally, 20% said they felt that their budget was wasted by agency false start on projects only for them to dead-end as a result of poor management by junior members of agency staff.
A time for change – the need is transparent
2020’s events have had a major impact on organizational activities and planning, as one respondent wrote, they are seeking agencies who will supply “a more targeted approach that is agile to emerging market needs”.
From the start, IBA has always organized itself differently from traditional PR agencies, offering a revolutionary new approach to delivering marketing and PR campaigns by working more like a publishing house and charging for its services by deliverables rather than by monthly fees. The days of marketers needing to pay to employ an agency in each new geography they target are numbered and content shouldn’t be a one-hit wonder. Rather, pieces of content should be reused and cascaded through social media, blogs, and press placements. This approach means services are scalable and because they are delivered from a single hub, has huge potential for the delivery of low cost international campaigns. Whitepapers, leadership articles and customer stories can be aggregated and re-purposed to support influencer programs and social media in whatever geography a company needs to direct its marketing, ensuring that the client brand is kept front and center in all target markets, new and old.
Agencies must listen up: Evolution is necessary to avoid extinction
Our research brought to the surface some deep rooted dissatisfactions stemming from agency attitudes and operational practices and highlights the increasing inadequacy of the ‘traditional’ agency model. Agencies have no choice; they must evolve or at the least find a new approach to satisfy the ambitions of B2B businesses seeking international growth in a results driven and cost-efficient way.