What you need to know:

• B2B companies are feeling the burn of churn as brands that neglected to invest in digital channels have watched customers switch to established and emergent competitors, according to Adobe data.
• As a result, B2B firms in ANZ are scrambling to hold what they have, with more than half prioritising retention over acquisition – well above peers across JAPAC, according to its latest survey.
• If B2B companies want to scale quickly or catch up with e-commerce rivals, they should hire top notch B2C marketers, reckons Adobe's Chief Technology Advisor Scott Rigby. The market should expect to see a wave of such talent raids starting to break.

B2B marketing to boom

B2B brands are being disrupted by rivals that have grasped the game has changed. Now they are racing to defend their turf before counterattacking, reckons Adobe Chief Technology Advisor Scott Rigby, and they are raiding B2C brands for top marketing talent as the likes of mining companies, oil refineries, and even universities building out new go to market strategies.

Rigby told Mi3 says that the likes of Hindalco, one of the world’s biggest aluminium refineries, is now competing with FMCG giant Unilever, retailer Accent Group, RMIT and thousands of others to build out digital catalogues, DTC channels and marketplaces in a bid to serve customers and deliver service design across the chain.

Those B2B brands may be behind their public-facing counterparts, Rigby says – but the divide is starting to narrow.

“It's still fairly early days for B2B in respect to digital,” Rigby said. “I think they definitely will [close the gap on B2C]. We've seen this time and time again, if you want to close the gap, what you do is go and hire from the B2C brands. That's the way to ramp up really quickly and steal IP and intellectual capital across to your own business. So I think without a doubt you'll start to see that.”

It's likely to be a three-to-five-year lag, Rigby estimates. But the same road has been travelled by firms building a stronger “EX”, or employee experience, framework.

“If you're a smart B2B player, what you want to do is actually go and cannibalise the B2C brands for the people that you need for your own business … The best place to go and build out your internal capabilities to execute experience is by going to go and cannibalise or at least share some of the IP from the B2C marketing team and say, well, ‘how do you understand customer behaviour to utilise that to drive employee behaviour?’ So I think without a doubt, if they're smart about it, they will be able to pull those resources through and then be able to accelerate the time to market.”

Coles, for example, hired a Chief E-Commerce Officer from Walmart and swathes of B2C companies more broadly are building out their own D2C and marketplaces alongside Amazon channels in a bid to regain customer connection and data – a trend CommBank aims to capitalise upon via recent investment Little Birdie.

Retention now bigger than acquisition as disruption bites

Amid disruption and emergent competition, brands are refocusing on customer retention. Adobe interviewed 81 marketers and found in Australia and New Zealand keeping existing customers has eclipsed “accelerating digital customer acquisition” for the first time.

Interestingly, the ANZ region far outstrips the Japan and Asia Pacific region, as per the graph below.

“At the start of the pandemic, and certainly the digital trend data that we saw, was that there was a large degree of churn from customers because the brands they were typically loyal to hadn't moved quick enough to make those products or services available in a digital economy. And so customers turned away,” said Rigby.

“And the result from this year is that we've seen for the first time ever, ANZ brands are focused more on retaining customers, so they're putting more money into retaining customers… There's definitely a maturity in the market here where there's a focus on 'how do we retain the existing customer base? We know it's cheaper to retain customers than it is to go out and acquire new ones.’”

The flip for the ANZ area was inevitable because of the size of the region, reckons Rigby – but it is still a significant shift.

“If you're in Asia and there's 130 million new customers to the digital world, as there was in the last twelve months – sure, you're going to be focused on acquiring as many of those customers as you can and building lifetime customers with your brand,” he said.

“But if you're in a mature market like ANZ, that flip had to come at some point.”

The pandemic brought it home much quicker than some had anticipated.