How B2B Tech Brands Grow

Despite marketing's critical role in B2B technology companies, marketing leaders (particularly brand) don’t always get to exert the same influence as their peers in product. Exacerbating this imbalance over the past few years is the popular GTM strategy of “Product-Led Growth” (PLG), a theory that promises brands outsized growth by leveraging product as the main vehicle to drive acquisition, retention, and expansion. So, do PLG strategies deliver substantially different outcomes compared to traditional GTM strategies for B2B tech brands?

To answer this question, we conducted research with The Ehrenberg-Bass Institute, to help you understand the fundamental marketing laws that govern growth to learn how B2B tech brands really grow over time. Download the full report for insights to better influence your cross-functional partners while leading your organizations to a proven path of sustainable growth, such as:

Why it’s not enough to depend on your product to drive customer loyalty and reduce churn rate, because retention is a function of customer penetration
Why it’s not enough to offer free trials and attempt to build “viral” product features, because growth comes from acquiring customers from the largest category players
Why it’s not enough to optimize LTV by upselling and cross-selling to existing customers, because growth comes from acquiring all types of new customers

The Limitations Of PLG Tactics

Every brand needs Mental and Physical Availability to grow. Strong brands can’t have one without the other, but PLG tactics over-index on building Physical Availability. The appeal of this theory is in the illusory shortcut that PLG offers: brands can get away with building Physical Availability without investing in Mental Availability (which is arguably harder to build and track) by using their product as the main vehicle for acquisition, retention, and expansion.
The Marketing Laws Of Growth

There is really only one way for brands to grow sustainably, and that is through increasing customer penetration by investing in both Mental Availability and Physical Availability. The Marketing Laws of Growth provide a map for how growth will happen and how to set objectives accordingly. Let’s see what we can learn about our customers, our competitors, and most importantly, our own companies through the following Marketing Laws of Growth.
The Double Jeopardy Law

Loyalty is a function of penetration, which is why smaller brands are penalized twice: they have fewer customers who are also less loyal compared to those of larger brands. B2B tech brands grow primarily by acquiring new customers, not just by trying to retain existing customers.
The Duplication of Purchase Law

Brands share customers with/acquire customers from all other brands, proportional to competitor share. B2B Tech brands grow by primarily acquiring new customers from category leaders at a higher rate than they lose existing customers.
The Law of Buying Frequencies

All brands will have a customer base that is comprised mostly of light buyers and relatively few heavy buyers, following the curve of the Negative Binomial Distribution (NBD) model. B2B tech brands win by serving their customer base the most profitably.

How B2B Tech Brands Grow

The 3 Marketing Laws That Govern Growth

Ready to apply B2B Institute principles to your marketing strategy?