DIGITAL STRATEGY | READING TIME: 5 MINUTES | 22 JANUARY
Centralized B2B SEO Facilitates Economies of Scale
How an optimally balanced centralization enables digital economies of scale. What processes should be conducted centrally, and which are more suited for a local implementation? These are some of the topics covered below.
Global leaders are experts in utilizing advantages from economies of scale within traditional business verticals. Our experience is that the same global leaders, especially B2B companies, are under-leveraging the same skillset when it comes to making use of these advantages in Pull marketing and SEO activities.
Leaders combine Pull marketing with amazing content to win customers’ attention during their research processes – not always to sell, but to assist in the purchase. The constant search for information on Google has become a vital and determining factor in all purchasing and research processes of the customer buying journey. Meanwhile, 77% of B2B companies consider their sales processes to be very complex.
Data also shows that 94% of B2B purchases include searching on a search engine like Google. In the wake of the pandemic, and our “New” future, B2B companies have a lot less influence and access to customer relationships. This makes ”search” the king of the hill, and one of the prime channels for digital communication. According to data, search results on Google are today considered to be more trustworthy than big brands and traditional media. This data only enhances the fact that companies must work with SEO to build and maintain trust for their brand.
Utilizing digital economies of scale in SEO
So, how does one make use of scalability and find a good balance of central processes and local activities? In short, optimal results are gained by applying an 80/20 split. This results in a shared “corporate memory”, instead of locally constraining business-critical and strategic information.
80 centralized, 20 decentralized
A fully decentralized digital marketing strategy and approach is great for small local organizations, and it is often ”fun” to work with creative marketing on a local level. However, nine times out of ten, this hurts the overall marketing efforts of a large organization, leading to lower competitive advantage and negative ROI.
An organization whose SEO operations are 80% centralized lets its local teams focus on execution rather than technical SEO and strategy development. While SEO needs to take local phenomena into account and be based on customers’ local purchasing behavior, only 20% needs to be dedicated to this.
Increased velocity, better results, and more efficient digital communication
Instead of giving each individual business unit responsibility of finding and curating insights regarding one’s product or service, this process can be centralized, and the information can then be supplied to the local branches. This will create momentum and increased velocity in processes and implementations alike. Our experience is that companies have old processes leaving investments related to IT be centralized. This gives local branches responsibility for marketing and communication in terms of both execution and budget. Companies do this despite the fact that digital marketing, and SEO processes in particular, doesn’t need to be managed locally – it doesn’t matter if the report for your latest search engine advertisements’ conversion rate is compiled in Beijing or Malta, the numbers are the same. All this indicates that companies, B2B in particular, have an outdated strategy of centralization. Especially companies with distinct separate business areas or business units.
”…a fortune 500 company who, over a three-year span, through six different persons and four business units, ordered 13 SEO analyses, which ended up showing similar results every time.”
A slow process that has the organization paying for the same thing several times
Two of the many downsides with having each business unit, region, and/or business area handling “their own” SEO is that the organization (1) experiences negative ROI due to multiple re-investments for the same outcome, and (2) loses momentum, hence they will be unable to move ahead at sufficient speed. Consequently, this process of decentralizing ALL of one’s digital marketing is both expensive and inefficient.
Taking our own experiences as a reference, we have a client, a global leader, and a Fortune 500 company, who, over a three-year span. Through six different marketing managers and four various business units, ordered 13 SEO analyses, which ended up showing similar results every time. Such behavior is akin to 13 people going on a bus trip where everyone rents one bus and a bus driver each, as opposed to sharing one bus.
The answer: there should be only one captain on the ship, with optimal balance
Not all analytic activities are to be decentralized. Instead, a central unit can start the projects and compile general insights and market trends. These can be used to develop local ways of applying the insights or as a foundation for further analyses. Meaning that the local branches won’t need to start from zero. The central organization will have already taken the first step, bringing the local teams with them to the next step. After this, it is up to each branch to build upon this and bring themselves to a market leader position. For example: create a content strategy centrally, and let the local marketing teams create and implement the content.
Maximize synergies in centralizing
In centralizing an organization’s analytical operations, it is important to identify what should be performed centrally, and what should be placed closer to production or sales. The Pareto Principle also applies in digital marketing, and by centralization of certain parts of the strategic work, local and super local parts of the organization can focus on their most valuable activities.
One group analysis adds more business value than 13 business unit analyses
Being a marketing agency niched in Pull marketing, we utilize a data-driven approach in our operations, a lot of which involves preparing analyses and creating strategies. We have noticed that it is more efficient to perform one large Pull marketing and SEO analysis compared to several small ones covering the same markets and companies. This means that it is more efficient to do an analysis for a corporate group than to do a standalone analysis for each individual company. There are several reasons for this. First of all, there are general insights for the market, and spillover effects giving the companies in a corporate group similar opportunities. These are more prominent in a large overarching analysis. In addition to this, there are also organizational advantages: instead of each company having its own project manager for the SEO partnership, the project can involve only the agency and a central team.
Our recommendation is, as a rule of thumb, to centralize 80% of the marketing budgeting, strategies, and analytics, placing the remaining 20% closer to the local sales teams. Such a distribution lets the organization work optimally towards both overarching and local goals, while also allowing more total resources to be put toward execution.
”Over time, winners keep winning not because they have exceptional data and strategy, but because they have systems that enable state-of-the-art execution of strategies.”
We are convinced that speed and execution are key factors for a future-proof digital marketing strategy. Regardless of whether you want to develop a complete digital marketing strategy, or want an in-depth analysis of your market situation, you can utilize our experience of working with market-leading B2B companies.