The ‘product delusion’ is holding B2B back

There’s plentiful research to show buyers don’t make purchases logically, yet B2B marketers still try to make sales largely based on product features.

Seventy-seven percent of B2B ads score 1 on a 1-5 scale of creative effectiveness, according to the B2B Institute’s research with System1. For B2C, that number is 53%. That’s substantially better.

What explains this sorry state of B2B affairs? Why are B2B ads so much worse than B2C ads?

Today, we’d like to share our own diagnosis. We believe that B2B marketers suffer from a very particular affliction that makes it nearly impossible to develop effective advertising. We call it the ‘product delusion’ (PD).

The product delusion is the belief that companies compete primarily on the quality of their product. The better the product, the stronger the sales. Brand barely matters.

How do you know if you suffer from the product delusion? Well, there are a few unmistakable symptoms.

Do you believe that buyers always choose the best product? Congratulations, you’ve got chronic PD.

Do you believe brands grow by communicating the superiority of their product? Do you insist on communicating value propositions like ‘80% faster processing speeds’? Yup, that’s textbook PD.

Do you have an itchy, scaly rash behind your knees or elbows? That’s probably eczema, not PD, but you should talk to a dermatologist to make sure.

The product delusion is pervasive in B2B businesses. Most B2B organisations are product-led, especially in the tech sector. And if you ask the head of product why the business is growing or shrinking, we can pretty much guarantee you that their answer will have something to do with…the product.

If business is booming, it’s because of our amazing product. If sales are sagging, it’s because the product isn’t good enough, and we need more engineers.

Brand characters could be the most undervalued asset in B2B marketing

It makes sense that product managers would fall for the product delusion. To a hammer, everything looks like a nail. And it makes sense that consumers fall for it too. Everyone wants to believe their decisions are logical, not ‘psycho-logical’, to borrow a Rory Sutherland-ism.

But what doesn’t make sense, at least to us, is that B2B marketers fall for the same delusion. B2B marketers seem to believe that if we jam the right product messaging into an ad, we can convince B2B buyers to buy our brands. According to our research, B2B marketers are almost twice as likely to rely on ‘rational’ product-centric creative than their peers in B2C.

This is despite oodles upon oodles of empirical research showing that distinctive, entertaining and emotional creative makes buyers more likely to pay attention to an ad, more likely to buy a product, and more likely to pay a premium for said product.

Our colleague at the B2B Institute, Mimi Turner, likes to joke that if B2C marketers thought like B2B marketers, Coca-Cola would market itself as “brown, fizzy, and sweet”. Forget those cuddly polar bears, Coke just needs to let customers know that it’s 98% effective in reducing thirst.

Coke doesn’t do that, of course, because its marketers are not crazy enough to believe that Coke competes with Pepsi on features (the product delusion). Coke knows it competes, and wins, on stronger mental and physical availability (the market reality).

But God help you if you suggest to a B2B marketer that their product isn’t all that important, and that their ads need to focus less on feeds and speeds, and focus more on cutting through with memorable, sometimes meaningless, creative. Salesforce’s feral racoon child, Astro, doesn’t communicate the specs of its CRM software. And yet, Astro works wonders, helping Salesforce dominate its category year after year. It’s a brand-first approach.

A growing number of marketers recognise the limitations of the product-first approach. But there’s a bigger problem: at most B2B organisations, marketing doesn’t actually run marketing. Sales, finance and product run marketing, and branding doesn’t fit in their spreadsheets.

How can you cure your organisation of the product delusion?

Want to develop much more effective B2B advertising? Well, talk to your doctor about ‘satisficing’, a performance-enhancing idea that treats moderate-to-severe PD.

In 1956, a genius named Herbert Simon introduced the satisficing concept, which won him a Noble Prize in Economics. ‘Satisficing’ is a portmanteau of ‘sufficing’ and ‘satisfying’, and it’s a foundational concept in behavioural economics and cognitive psychology.

Back in the Dark Ages, economists believed that humans were ‘utility-maximising’ automatons that made decisions based on a series of cost/benefit calculations. But Simon proved that most humans are satisficers, who tend to choose the first acceptable solution over the best possible solution. We satisfice to conserve mental and physical energy, and because it works. We don’t have unlimited time or perfect information, so we settle for ‘good enough’.

The problem isn’t that buyers don’t know enough about your products. The problem is that buyers don’t know your brand exists.

So what does this mean for B2B marketers? It means that your ads don’t need to convey the superiority of your product, because that’s not the key factor that drives buying behaviour. Buyers don’t want the best possible product, buyers want good-enough products that come to mind easily (mental availability) and are easy to purchase (physical availability).

Our recent research with the Ehrenberg-Bass Institute found that, even in high-involvement purchases, very little evaluation occurs. For instance, when B2B buyers need a new financial service, 47% go straight to their existing bank, and 75% of those who claim to shop around also end up with their existing bank. And most buyers don’t even consider more than two brands.

The truly rational B2B buyer would consider dozens of banks, compare their product specifications and prices, and choose the best possible option. The truly lazy B2B buyer would default to the brand they already know, which is what all of us do in practice.

The problem isn’t that buyers don’t know enough about your products. The problem is that buyers don’t know your brand exists. And marketing exists to solve that problem.

B2B businesses compete on availability, not on product

Would you rather sell a mediocre product that’s well marketed? Or an incredible product that’s badly marketed? We’d bet on the better-marketed brand, every single day of the week.

We’re not saying that product doesn’t matter at all – of course it does. But most products are more similar than different. Coke and Pepsi in B2C, or AWS and Azure in B2B. Where products differ is in their availability: how “easy to mind and easy to find” a brand is to category buyers. For example, most startups think of AWS and most enterprises think of Azure.

This is a tough pill to swallow for the engineers who rule over most B2B businesses. It feels dishonest to compete on mental availability instead of product superiority, which is why you’ll never hear a CEO say: “Our product is pretty shitty, but our marketing is absolutely phenomenal.”

But at the end of the day, marketing doesn’t control the product, at least in most B2B businesses. And there can only be one ‘best’ product, so if that’s all that matters, what are those of us with mediocre products supposed to do? Cry ourselves to sleep? No, of course not. Marketers control something much more important than the product: the brand.

It’s time to wake up from the product delusion. The best product is the one you know.

Peter Weinberg and Jon Lombardo are the heads of research and development at the B2B Institute, a think tank at LinkedIn that studies the laws of growth in B2B. You can follow Peter and Jon on LinkedIn.