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White Paper

The New BtoB Path To Purchase

With an expanding menu of information and options available at their fingertips, new research reveals BtoB buyers are increasingly bringing their consumer buying patterns into their selection process for business solutions.

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.

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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;

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

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.

How would you describe the budgeting/approval process A lot of this is vendor-driven, said Matt for this recent solution purchase (2011 DATA)? West, VP of Marketing, Genius, which 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 16% 11% 27% 26% 21% 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 whos most interested in nurturing through the process. So by the time that

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connection is made, it is inbound or by the time that outbound call is made its to that select group of people who have been nurtured through the process and have exhibited buying interest or intent.

41% said they engaged with a sales representative only after their initial research was conducted on various options;

This trend of the buyer taking control of the purchase process actually expanded in 2011, demonstrating the growing challenge for BtoB salespeople to influence earlystage buyers. Illustrating the increasingly buyer-controlled process:

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?

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 2% 7% 6% 24% 22%

41%

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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.

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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 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 years 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.

Which resources did you find most useful in the early stages of the buying process? 71%

35% 16% 10% 21%

41%

44%

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s s s s er ting Video binar Studie ooks views Oth g Pos -b We ase ver rs/E C tO Blo ape roduc P P ite Wh emos/ D

Its clear that budget hasnt gone out the window, but its not necessarily a driving force.
- Matt West, VP of Marketing, Genius

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 hyperdrive 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.

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

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? 56% 56%

24% 12% 12%

27%

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Its clear that budget hasnt gone out the window, but its not necessarily a driving force, West said. As a seller, you dont need to get that involved early in the process. You definitely need to be topof-mind, but its not like theres a buying season and you can miss it. Its more like, if theres a need, theyll 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-andexpand 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, its 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.

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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 years 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 years respondents was implementing a product or solution for a specific department (69.7%), while 23% formulated a pilot project before finalizing a companywide 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 There were over 230 respondents involved in a BtoB purchase who responded to this survey. 4% 36% 27% 7% 10% 17% $500 to $1 billion $250 million to $500 million $1 billion and above $50 to $250 million $10 to $50 million $Below $10 million
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that their company generated more than $1 billion in overall revenue.

Conclusion
The 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 buyers 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.

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White Paper

About DemandGen Report

DemandGen 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.

About Genius
Genius provides powerful, yet easy-to-use automated marketing solutions that enable both Marketing and Sales users to quickly identify and connect with their best prospectsinstantly. The powerful Genius cloud computing infrastructure delivers automated marketing, including lead generation, email marketing, and lead management with instanton 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 info@genius.com www.genius.com

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