Recently I worked with a client who wanted me to help him growth hack for a startup doing B2B enterprise software. It’s remarkably hard to find stuff that works and this is because of the Corporate Moat.
We’re all pretty familiar with Geoffrey Moor’s chasm. That’s the big gap between early adopters and the early majority. Can you get across to the mainstream from a segment that lives and breathes tech. Is your value proposition strong enough to appeal to someone who doesn’t know what Stripe or Slack is?
When I think about growth hacking I normally have two models in my head. One is the classic epidemiological model of how infectious diseases spread (or models rather). The other is a network map showing strong and weak relationships as popularised by Granovetter and others.
In both of these types of models (they aren’t that dissimilar) yu can assume that once you have infected someone with your marketing and you have the right conditions in place then the ‘infection’ will spread through the network/population. That’s brilliant and that’s how everything from Gmail, to Dropbox and most of the other old roans works in B2C growth hacking.
The trouble is that when you come to B2B the purchasing/adoption decision is made, in theory, with a simple pair of questions.
- Will it give me a competitive advantage?
- Will it increase shareholder value?
If we assume that our hypothetical product does answer these questions positively we get an interesting corollary.
- Why should I tell anyone what I am doing and risk letting them find a counter to my ‘secret sauce’
There are exceptions but it is at this point that growth hacking for B2B’s generally dies. The veil of corporate secrecy and competitive confidentiality means that the better an idea/product/service it is the less likley it is to be shared. You can further qualify this by saying that the more effective it is for a particular industry the less likley it is to be shared. So the normal advantages of niching are against you. So we end up in a situation where we have isolated populations, much like isolated villages in the highlands of Papua New Guinea. However hard you try you are not going to find some way of engaging with the company on a viral basis.
You have to fall back on content, advertising or expensive direct sales people.
There are a couple of approaches that you can take. the most obvious is a grassroots strategy. In this case you consider enterprise employees to be sets of the larger population. If you manage to get adoption in the larger population then those sets of employees start to put pressure on the buying centres of enterprises and you get growth that way.
This has problems. An enterprise solution is quite different to a B2C solution and evidence from, say, Dropbox, suggests that it’s wildly successful consumer product is difficult to replicate on a corporate basis. That skew flip is hard to pull off outside space travel.
It also doesn’t take any account of the population characteristics in the target company(ies). The results from a government tax office and a rapidly growing startup will be quite different due to organisational structure, communications and culture.
This also provides an opportunity.
B2B sales are attractive as a single conversion can deliver a significant revenue increase, whereas in B2C a single conversion barely moves the needle. A large corporation with 20,000 seats, or one like Hon Hai, with a million employees provides some very interesting opportunities.
The goal here is to undertake marketing campaigns targeted at employees within a company in order to promote adoption and purchase. The design of these campaigns clearly depends on organisation structure, aspects of IT security and policy, how communications works with the company, or corporate structure and many other features. There are clear privacy aspects that need to be considered as research preparatory to the campaign is undertaken. In many ways we consider personal and business personas to be separate but in most cases personal, publicly available data, would clearly be used to enhance the corporate map.
The big problem with all this though is the final layer of corporate defence. The buying centre. Purchasing decisions are controlled and kept separate from staff in order to avoid undue influence or corruption of the buying process. So any viral campaign, will in theory, be able to impact influencers, at 1st, 2nd and 3rd level, but will they have enough impact on the buying centre to alter a decision and justify the marketing spend.
I think that there are ways of doing this. The key parameters are
- scalable reskinnable viral mechanisms
- weak immunity on the part of the corporation to effective value propositions. So the solution needs to be a step change better in performance
- effective avoidance mechanisms – that would make it hard to be shut off by IT
- reinfection and gamification UX mechanisms that are tailored to the corporate culture/structure
- pre-structured conversion path for migration from the legacy system
A campaign would initially start with a small number of corporations to baseline variation across different corporations and establish the impact on purchasing decisions. Depending on the vertical that could mean abandonment, a fully automated campaign or a hybrid system of growth hacking and direct sales into a warm environment.
Scaling would then roll out campaigns to additional corporations tailoring to their corporate genome. Right now I have no idea if using Handy or Hofstede would be any better than using Schein as a model. First of all we’d need data to see how they responded and then, I suspect, the focus would be building blended approaches that selected what worked combined with what information was publicly available – for example Scheins’ artifacts would be available but how accessible would corporate values – in the sense of living values rather than documented values – be?
Lot’s of interesting stuff – but what’s the ROI?