*BONUS episode*: Propolis Community Index and B2B Ignite preview

PLEASE NOTE: This transcript has been created using fireflies.ai–a transcription service. It has not been edited by a human and therefore may contain mistakes.

00:00
Dom Hawes
Hello unicorners. We are only days away from B2B ignite, the annual conference where business marketers learn, share, meet, network and plan the year ahead. Now, in case you don't know, B2B ignite is an all day business marketing conference taking place at 133 Hamsditch in the City of London on Wednesday the 3 July. The good news is, if you haven't yet booked a ticket, it is not too late. You can do that by visiting the link on our show notes or you can go straight to events dot B2Bmarketing.net B2B ignite might be easier on the show notes anyway, in this special episode of Unicorny, we are going to explore the key trends affecting business marketers.

00:41
Dom Hawes
As a primer for the event next week, we are then going to take a brief peek at who's speaking, who's attending and what's in store. So today we're talking about trends, sentiment, confidence and more. Don't go away. You're listening to unicorny and I'm your host, Dom Hawes. You may be asking yourself, how on earth do the guys at unicorny know what the key trends affecting business marketers are? Well, we know it because the Propolis community Index is live. The community index is a real time dashboard of marketing metrics that takes the temperature of the business marketing community to explore current trends. I am joined today by the very popular and extraordinarily debonair CEO of B2B marketing, Richard O'Connor. Richard, welcome back to the studio.

01:34
Richard O'Connor
Well, it's very nice to see you, Dom, and thank you for having me back. I've been doing rather a lot of these recently, which is, yeah, it looks like I'm sort of self promoting, but there's a lot to talk about.

01:42
Dom Hawes
You're very welcome. And today we're going to talk about the Propolis community index, which I think is really interesting. And I'm also going to do a little bit of a preview of B2B ignite, which, as I said in the introduction, is taking place next week. So we're recording this one week and one day before ignite goes live. So let's kick off. What is propolis?

02:01
Richard O'Connor
Well, it's part of B2B marketing. So I'm chief executive of B2B marketing and Propolis is our digital hub for B2B marketing leaders in their team. So it's about B2B strategies, B2B skills, B2B growth, and it's part of our wider ecosystem of conferences, events, roundtables and growth solutions. It's a membership community. We have expert consultants within the community. We have a number of marketing models and strategies and expert content, as well as the community itself. So we have B2B marketing leaders who are sharing their experiences and vulnerabilities and challenges with each other and helping each other solve some of the common marketing B2B marketing problems.

02:44
Dom Hawes
We know it well. Obviously we are members of Propolis and it's a very good and very useful resource. So we're going to talk about the community index today. Tell me about that specifically, what is it?

02:53
Richard O'Connor
Sure, sure. So one of the things that our members had been asking for some time was reliable benchmarks, indexes, metrics that allow them to make decisions, make the case for investment in marketing, make the case for more spend in brand or more spend in demand, general whatever it is required, or ABM. Two years ago we started collecting data just to try and get a sense of the market. So we collect data from tend to be sort of enterprise level organisations, mid level to enterprise organisations. We collate all of that data across a number of different sectors. And the first year's data was fascinating. We got a good measure of the market. We collect data from customer attrition, we collect it on marketing spend, we collect it on where that spend is being allocated, a little bit on organisational design as well.

03:40
Richard O'Connor
So some of the things that we've been asked for from our members, what's made it really interesting is in year two we've just got our year on year data, so we've got our first set of data which shows the difference between 23 24 and obviously going into 24 25, depending on what your financial year is. So it's our first set of year on year data and it's thrown up some fascinating insights.

04:00
Dom Hawes
Okay, so we're going to look into the results in just a minute. How's the data gathered? I mean, is this survey or.

04:07
Richard O'Connor
It's a combination. So we use a very well established market research firm to collect a critical mass of data and then we top that up with membership data. So we have what's called a give to get model. If you want as a member to have your own benchmark against the global aggregate, then you fill out your data and you get your own business benchmark. So in that way we're continually collecting data from our members and they get in return a sense of their metrics against the global aggregate. So it's an ongoing kind of live dashboard. So we're collecting data all the time.

04:38
Dom Hawes
Okay. And just to be clear, because actually I hadn't appreciated this until this very second. The third party that's doing research is not just researching members, they're researching the.

04:48
Richard O'Connor
Wider industry across a number of different sectors.

04:51
Dom Hawes
Do you know what unicorners. That's going to make today's conversation very interesting. You collect data across three main areas. Let's get a bit of an understanding of what those are. The first one's budget, spend and roi. What's the thinking behind collecting data in that area?

05:07
Richard O'Connor
Yeah, it's just a sense of what are the trends with marketing budgets overall, the size of budgets. We also look at the percentage of revenue that marketing is responsible for, which is a very good indicator of the impact that B2B marketers are having on growth and tangible business return. And then we start to look at where that budget is being spent, both internally and with third parties as well. So we get a fairly granular understanding of where the market is allocating budgets and on which particular activities, both internally and externally.

05:38
Dom Hawes
And the next is customer growth. And attrition probably speaks for itself.

05:42
Richard O'Connor
Yes, it does. It does. This is about average customer tenure, this is about renewal rates, this is about revenue uplift, those sort of metrics around customer retention.

05:55
Dom Hawes
Okay. And the third one, I think is really interesting, resourcing and particularly organisational structure. What's the thinking behind that?

06:01
Richard O'Connor
One of the trends that we've seen is a move gradually towards more centralization, but not with every business. You know, some sectors have more centralised marketing teams, some have more local teams. So we're just trying to pick up some of those trends around the shape of the marketing team and the types of roles and things like attrition of marketing teams themselves. So are marketing teams growing? Are we seeing attrition rates improving or changing over time?

06:26
Dom Hawes
So we're going to look at headline stats and then I think, dig into each of those three areas. But first off, as a propolis member, there's an area on propolis that I can go to and I can see the dashboard. How else does this data appear? How is that data turned into useful information?

06:43
Richard O'Connor
Yeah, of course. So as a propolis member, you can go in at any point and that data is changing not dramatically all the time, but as we're collecting data, it does change. And we will have this early year on year. Data is the aggregate at the moment, but once we get to the critical mass, which will be at the end of this month, we'll have the sectoral split across manufacturing, financial services, professional services, technology and healthcare. So five core sectors, and then it breaks out between EMEA and the US as well. So we have a location split as well. But you can go in there and look at the data. Obviously when you fill out the survey yourself as a member, you'll be able to make the comparison, as I said before. And then we produce a number of reports.

07:24
Richard O'Connor
So there'll be a report available at the proper standard ignite next week for those who aren't propolis members. You'll get a sense of the data. You won't get the full richness that a propolis member gets, but you'll get a high level view of what we're finding. And then the data also informs our agenda for ignite, informs our roundtables that we run. It informs our events as well, because it's part of the fabric of how marketing and marketers are feeling.

07:50
Dom Hawes
It's live so extraordinarily timely. And for non members, if they go to ignite and come to your stand, they can get a copy of or an extract at least.

07:59
Richard O'Connor
Absolutely, yeah. There'll be a report and then the team, I'm sure, will give you a sneak preview of the index itself.

08:04
Dom Hawes
Let's look at some headline stats then, in each of the areas, just to get a feel for what's happening in our industry. And we'll start with budget spend. Can you give me an overview of where budget, where spend and where the demand of marketers to prove value is?

08:18
Richard O'Connor
Yes. So we've seen year on year, a 3% increase in budgets, which gives an indication, I think, you know, when we've tested this with members and we've tested this with customers, that seems to be a fair indication that there is more confidence returning certainly to the market. And we'll wait to see whether that carries out across the sectors. But perhaps even more encouragingly, there's been an 8% increase in the percentage of revenue that marketing is responsible for.

08:48
Richard O'Connor
And, you know, we've talked about this before, you, the business marketer or the commercial marketer that we've been championing, it does give an indicator, indication that marketers are becoming more commercial, taking more responsibility directly for revenue growth, tangible return and I think perhaps, hopefully, the correlation we could make between the increase in budget and the increase in revenue that marketing is responsible for is that the marketing budget is being well spent and it is showing a return. I think it's quite binary, isn't it? Marketing budget. If it doesn't work, it gets cut. If it's working and you can show tangible growth, it increases. So I think the signs are both good for marketing budgets. It's cautious optimism, but perhaps even more so that it's being well spent and delivering a tangible return.

09:33
Dom Hawes
I think also that probably plays into the fact that in this stage of the economic cycle, everyone's over indexing on shorter term activities. I was really surprised to see the percentage of revenue increase actually, by that much I have, as you know, may know if you listen to the podcast, I have a hate relationship with ROI as a measure of marketing effectiveness, and I'm not honestly myself sure what being directly responsible for revenue necessarily means in a marketing context, unless we're talking about performance marketing. But I think that's really interesting when you look at some of the other data that supports this, you might think that people would be spending more on demandgen or ABM, but that's actually not what you saw.

10:17
Richard O'Connor
No, actually, in fact, we've seen a pretty significant increase in things like market research, which is interesting, isn't it? So what is that, market research? I think it ties in with a little bit with ABM. If you came to our ABM conference last year, you'll see that AI has breathed new life into ABM. Done well. It requires research into accounts and I think with AI we're starting to see access increase to perhaps clients who didn't consider it before. And with that, I think perhaps comes the research element and having to do the analysis on clients and target clients and ICP and sectoral targeting, but also the specific companies themselves. That might be one element as well, but also white space. Looking for new opportunities for growth 23 24 wasn't a brilliant year for everybody.

11:06
Richard O'Connor
It was for some sectors, but I think broadly, I think people found it quite tough. So perhaps there was an opportunity looking for new growth opportunities within the organisation.

11:16
Dom Hawes
I think that's really interesting. 23 24 was very tough. 24 25 I don't think is any easier within the amount of elections going on this year. We've got the euros live at the moment. Try and catch anyone who's not watching tv after about 430 in the day. So I think productivity is going to take a bit of a bash this year, but I think so. Really interesting. So here I am. My inbuilt confirmation bias is saying that marketers can't possibly be responsible for more revenue, but the budgets are increasing and they're not necessarily going in the direction of performance, according to the data that we watch that we're seeing on your dashboard. Indeed, content creation and digital, actually, the budgets are coming down.

11:53
Richard O'Connor
It seems that way. I'm not surprised to see an increase in social media marketing as well. I mean, spend any time on LinkedIn as we all do, it has become an increasingly noisy channel. But there's definitely a significant increase, a 5% increase year on year in social media marketing. I think you can instinctively see that not just on LinkedIn but other social channels as well, increasingly TikTok as well. That seems to be an increasing channel. It's not everybody's cup of tea, but it certainly seems to be growing. But yeah, it is interesting. You would expect to see perhaps a little bit more on email marketing, but it's not. It's a slight decrease. But demand Gen is one area where we have seen a big increase and I think perhaps that's in a tough year.

12:43
Richard O'Connor
People going back to arguably inverted commerce, tried and tested methods and from what we're hearing more broadly, demand Gen and that not the same as lead Gen, but demand Gen is certainly on the rise.

12:57
Dom Hawes
Where people are delivering ROI by different categories of spend is really interesting as well. Do you want to pick out maybe one or two of those and just comment on those just to pick out a couple?

13:09
Richard O'Connor
Social media marketing seems to have had a slight improvement in return, so suspect that's through paid social. We've seen a slight improvement in events and conferences. In fact, not only have we seen an improvement in events and people doing events, but actually they're spending more on third parties for events and conferences as well. So whether that be of vendor or that be a particular agency, which is really interesting. And I think another shift that we could focus on is a bit more effort on paid media as well.

13:38
Dom Hawes
So and then finally we come to look at an area. Obviously it's very close to my heart, but marketing leaders are using agencies still. I've seen it, the relationship or the need is changing. Talk to me a little bit about what you're seeing.

13:51
Richard O'Connor
The good news here is that clients are using marketers for more services, a broader range of services. So it was quite narrow last year, but we've seen, as I said, an increase in spend on events and conferences and support. With that we've seen marketing technology and tools. So vendor support, but also agencies supporting in selection of vendor of technology and tools. Social media marketing again has sort of come into the index as well. There wasn't much spend on that last year. Big increase in demand general as we discussed, using third parties for demand general account based marketing, 7% increase as well as you'd expect. And that certainly plays out with our ABM conference last year. As I say, AI has breathed new energy into ABM and making it a bit more accessible to perhaps companies that hadn't considered it before.

14:44
Richard O'Connor
So just a few there. Slight decrease in spend on brand and brand awareness with third parties. That doesn't mean they're nothing, that brand isn't important, it's absolutely crucial. It's just that they're not using third parties quite to the same degree that they did in prior year.

14:57
Dom Hawes
And I think finally we have a correlation here between budgets maybe going up a little bit, between percentage revenue responsibility going up, but money being spent externally on brand, that is the long term going down. So people are deploying or they're allocating their resources outside their organisation for short term and they're taking the longer term probably in house.

15:18
Richard O'Connor
Yeah.

15:18
Dom Hawes
And is that your absolutely chimes with what I'm seeing now? Not exclusively, I will say not exclusively, but I think for me that's a feature of the market we're in. Speaking of markets, let's move on to customer growth and attrition. There were some really interesting results in here. How many new customers marketers are looking to acquire in this year compared to last year. And the stats have changed slightly.

15:42
Richard O'Connor
Very slightly. Very slightly. There's a three point shift in those trying to acquire more customers this year. So not dramatically, but what's coming with a bigger budget and a higher expectation is an expectation that directly translates to more or less proportionately to more customers.

16:03
Dom Hawes
What I thought was interesting, though, and the numbers are small, as you say, but although the number who expect to get more has increased, the numbers who expect to have fewer has also increased. So we're seeing a market that might be polarising where there are those who expecting growth and there are those who aren't. And I think that might be something that's interesting to look at from the head.

16:23
Richard O'Connor
Very true. And it'll be interesting to see how that plays out over sectors which we'll be able to do.

16:27
Dom Hawes
Yeah, that's really exciting. I can't wait for that stuff to come out. And in terms of customer tenure, that was another one that really struck me. That's changing.

16:36
Richard O'Connor
Interesting. Average customer tenure. I mean, we're typically talking about large organisations here. Eleven years a customer that you've had for a long period. And we certainly know from our experience that if you keep a customer for more than two years, they tend to stay for a long time. It's that year one churn. In fact, we don't do the year one churn, but it might be an interesting metric to have going forward. But that eleven year tenure has dropped to seven. Perhaps that's more competition in the market. There's people looking around, shopping around a little bit more. We certainly know that it's not been easy for sectors that perhaps have had a longer customer tenure. I don't think, you know, professional services, financial services, I don't think they've universally had a great year.

17:20
Richard O'Connor
And perhaps, you know, that part of that translates into not necessarily keeping customers for quite as long.

17:26
Dom Hawes
Again, that chimes exactly with what we're seeing, where it's the rise of procurement, isn't it? So that you've got now you've got professional. Well I suppose enterprise always had professional procurers, but procurement is taking more of a front seat role in relationship management, moving on to organisational structure and resourcing. I thought it was really interesting here. So we've seen a lot of in housing this year which we're not surprised about. In fact, we've catalogued on here with many properties. Actually there's been a process of both centralization and decentralising at the same time and that's been the shape of marketing transformation that we've seen.

18:03
Dom Hawes
So centralising and building capacity in brand and brand management and those things that you would expect to operate at corporate level and then decentralisation of decision making, particularly obviously around field marketing and those sorts of activities, but really giving much more autonomy to countries regions by building capacity in house.

18:25
Richard O'Connor
Sure. Well you've added some richness to the data here. I mean we've seen a 7% increase in centralised headcount, but it's interesting because you've given a bit more context to where that might be. Things like centres of excellence are growing all the time. You know, shared service centres, shared service functions. We hear a lot and we talk a lot about centres of excellence in propolis because people are just trying to work out how to be effective in a matrix structure. How do you affect change when you're sitting as part of the centre and don't necessarily have that local responsibility and p and l accountability? Certainly we're seeing the data centralization of.

19:01
Dom Hawes
Headcount and marketing team headcount increased significantly this year.

19:06
Richard O'Connor
Yes to 20%, which were both encouraged and perhaps a little surprised. But I think there was a lot of shedding of headcount last year. This is an interpretation, it's a personal view, but when you get to the end of a financial year, you've had a difficult year, you have to start reinvesting. If you've had headcount cuts, you have to then start to look at where does the next growth come from? We can infer from that there's confidence. In a macroeconomic sense, I certainly think there's cautious optimism, despite the potential upheaval of global elections. 60 I think globally, extraordinary year. And I think that's being translated into some confidence in hiring and attrition rates way down.

19:48
Dom Hawes
Which, again, bears out what you were just saying, that last year, quite big attrition rates in marketing teams, this year, not expected so much.

19:56
Richard O'Connor
No, a 10% drop. So 5% attrition. So holding on to people, we know that the market certainly for senior roles is not easy.

20:04
Dom Hawes
No. Really hard at the moment.

20:05
Richard O'Connor
Really, really difficult.

20:06
Dom Hawes
The amount of talent, I know that is ready and willing, but unable to find, like, the right role. I guess the more senior ones are very picky about what they'll take too, though, obviously.

20:16
Richard O'Connor
Yeah, quite. But if you think of the talent on the bench, it's amazing. And then perhaps if you triangulate that with the impact that they can have on revenue, I think businesses should be really looking to make sure that they can access some of this talent who are available.

20:32
Dom Hawes
Richard, what's the takeaway from the community index at the moment?

20:35
Richard O'Connor
I think cautious optimism is the word of the day, and we'll continue to track this over the course of the year. So there'll be some changes, I'm sure. Setting aside that the quant, the qualitative mood as well, within propolis and our wider ecosystem events, is that people are feeling that if they can get back to a level of modest growth this year, if they can get back to a feeling of confidence and stabilising Q three, Q four this year, I think they hope that Q one and Q two would have been the growth quarters. I think the feeling is that it slipped to Q three, Q four and then early 2025.

21:15
Richard O'Connor
But setting aside any geopolitical events or disasters or things out of anyone's control, I think the expectation is that Q three, Q four in 2024 and then into 2025 will be much more positive.

21:33
Dom Hawes
So big thank you to Richard O'Connor, CEO of B two, b marketing, for coming to take us through the Propolis community Index. He has now left the studio, and I'm just going to tell you a little bit about b two, b ignite. This is a special episode dedicated to both b two, b ignite, but also the community index, because it's kind of our mission how to create value. Right. And I think there's enormous value to be had by all of us meeting at next week's B2B ignite. I will be there. Look me up if you haven't yet got your tickets, it's not too late. I'm not going to give you the domain again. Just go to our show notes. You can click on the link. I'm going to take you through the agenda very briefly now.

22:10
Dom Hawes
And then I'm going to give you one other reason to go. So Wednesday the 3 July is the formal conference. There is some training going on the second B2B storytelling, AI writing fundamentals for B2B and ABM essentials. But I'm focusing on the 3 July. The day kicks off with a breakfast briefing, but the formal day starts at 09:00 and at 915 there is a keynote busting the brand myths, which is delivered by Rachel Fairlie, guest host of the Unicorny podcast, and Sarah Robb, her first guest. And you can hear that episode by just going back about three weeks in your feed. That will be a keynote to die for. So if for no other reason, you need to go to B2B ignite to hear Sarah and Rachel.

22:56
Dom Hawes
The keynotes then continue up until the 11:00 morning break with a talk on growing untapped markets with ABM and one on the commercial value of marketing to the board. And then after the break at 11:00, at 1125, the conference breaks up into streams. I'm not going to go into detail. You can find all of the agenda on events dot B2Bmarketing.net and then from the rest of the day, really until the end, the day is streamed now. Our friends at B2B always end the B2B ignite conference with an extraordinary speaker. And this year they've done it again. Mark Grist, award winning poet, storyteller, educator, is going to deliver a closing keynote titled from Slacker to viral sensation, engage even the toughest audience. Well, I'm looking forward to that and I'm looking forward to the event.

23:48
Dom Hawes
If you do decide to go, please do look me up, cheque me out on LinkedIn. You'll find out what I look like. Come up and say hi because it would be lovely to see you. And just before I go, I did say there was one other reason. I think it's really well worth going. They are running a digital gallery of the award winners for the B2B Marketing Awards 2023. So if you want to have a look at what the very best creative and the very best marketing effectiveness looks like in business to business marketing, it's going to be on display at this event. I hope to see you there. You have been listening to unicorny. I'm your host, Dom Hawes.

24:29
Dom Hawes
Nicola Fairlie is the series producer, Laura Taylor McAllister is the production assistant, Pete Allen is the editor, and Peter Powell is our scriptwriter.