3 Questions to Help Industrials Outperform Their Competition
Response to McKinsey & Company’s: Building marketing and sales capabilities to beat the market
This spring, global management consulting firm, McKinsey & Company released ground breaking research showing that B2B (and especially industrial) companies with advanced sales and marketing capabilities consistently outgrow and outperform industry competition. Their 2015 study found that in those companies, revenue growth tended to be 30 percent higher for those equipped with advanced sales and marketing capabilities.
As a company specializing in advanced sales and marketing systems for industrial, we were extremely pleased to see this research! These numbers back up what we are always working to convince our skeptical industrial buyers of – that investing in advanced sales and marketing capabilities has clear and measurable benefits – and according to McKinsey, MORE benefit than investing in equipment in many cases.
As a response to McKinsey’s research, and to help further show how advanced sales and marketing capabilities can benefit industrial marketers, we decided to answer McKinsey & Company’s three “Questions to get started” from the perspective of our industrial buyers.
“In our experience, CEOs and senior executives should ask the following three questions to get the process moving in a fruitful direction:”
1. How good are our marketing and sales capabilities today compared with best practice?
“Our customers know who we are.” “We do great work, so customers will choose us”
We hear these objections to adopting advanced marketing capabilities from industrial companies all too often. The strategy of relying on existing relationships and reputation alone may work in a vacuum, but in reality, factors such as changing market conditions and competition, make this unsustainable. In order to effectively maintain your current customer base, and also expand it, industrial companies need to resist relying solely on word of mouth marketing, and start adopting best practices with more advanced sales and marketing capabilities.
2. How much value is at stake in radically improving our marketing and sales performance?
Another common problem we see in the industrial market, is that companies are unable to adapt to changing market conditions, and end up losing market share, cutting staff, or worse yet, going out of business. That leaves a lot of value at stake.
For businesses with advanced sales and marketing capabilities, bouncing back from poor market conditions is a much faster and easier process than for those without. These companies are able to capitalize on sales opportunities such as geographical or vertical diversification. Beyond this, companies with advanced capabilities are equipped to easily test the waters and enter new markets, without the barrier of a large upfront investment that is experienced by their competition.
3. What’s the ROI on our current capability investments?
For many of our industrial buyers, Marketing and ROI are seen as two words that couldn’t be more contradictory. We know that this is far from true, but there is a reason many industrial companies have this stigma – their typical marketing investments such as trade shows, print advertising and networking, are costly and unmeasurable. Through investment in advanced sales and marketing capabilities, a more effective and measurable strategy can be developed. Capabilities such as ROI measurement and lead tracking can work to make existing marketing tactics more effective and also to offer new sources of marketing ROI.
Ready to Get Started?
If you’re ready to develop and sustain a competitive advantage, that helps you to consistently outgrow and outperform industry peers, McKinsey & Co.’s article proves that investing in advanced sales and marketing capabilities is a great way to do this – even for industrial. To get started, try answering these three questions for your own business to help you focus on building the right capabilities. To see more of McKinsey & Company’s research, you can view their full article here.
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About Katie Cross
Katie Cross holds a B.B.A in Marketing, and has paired her degree with hands-on experience in online marketing to promote success within business to business marketing. She has a strong track record of success and achievement in social media, SEO, email marketing, and marketing strategy.