Talking B2B Tech: SAP
SAP’s marketing leaders on the value of being a brave brand in difficult times
06 Minute Read
Kerstin Köder and Masa Schmidt explain how marketing is helping the business move into new market segments, adapt to a changing buyer journey – and stay committed to putting customer value first.
It can take a moment of crisis to reveal what a brand really stands for – and how deep that purpose runs. That’s certainly been the case for SAP during the pandemic.
The business made the bold decision to put customer value above short-term shareholder value. It positioned itself at the centre of the COVID-19 response by enabling medical collaboration and playing a lead role in repatriating German citizens when the world locked down. It partnered with Telekom / T-Systems International to help fight the pandemic with the development of the Corona-Warn-App. Made available in just 50 days and downloaded over 6 million times in its first 2 days, that app is now the backbone of the pandemic response across Germany and much of Europe.
SAP also took an even harder decision: refusing to chase short-term revenues when major digital transformation projects were put on hold. Instead, the company made its software freely available and rolled out training and other support to help businesses get through the crisis and survive.
These choices were initially punished by shareholders when SAP released its results in October. However, in engaging a far wider potential customer base of small and medium-sized business, they’re now providing a foundation for sustainable future growth that’s seen the share price largely recover since. SAP is shifting from a sales-led model focused primarily on large enterprises to one in which marketing takes the lead in engaging smaller businesses at scale. As Head of Marketing EMEA and Head of Marketing Germany respectively, Kerstin Köder and Masa Schmidt are at the heart of the change.
New market opportunities – and a new role for marketing
“The role and importance of marketing and the way that it supports the growth strategy have changed a lot,” says Kerstin. “We are much more focused on bringing additional value to the business – and not being where sales already are. In the past, we would work closely with sales but always on the same customer segments. Now, marketing does much more.”
“We are focusing more on small and medium-sized enterprises – and marketing plays a huge role in this volume business,” adds Masa. “This is also where technology comes into play, helping us to intelligently target this huge potential market and generate leads via marketing.”
This transformation in marketing’s role was accelerated by a shift in tactics enforced by the pandemic and the disappearance of in-person events. “There’s a quote from McKinsey saying that five years’ worth of digitisation took place within about eight weeks – and that’s certainly been the case for SAP,” says Kerstin. “The disappearance of physical events means we’ve had to turn the tactical mix upside down: from value to volume, from outbound to inbound, from push to pull. We are only running end-to-end digital journeys now. It’s the new and modern way of marketing, and in that respect, COVID-19 has helped us to transform.”
How data transformed the sales-marketing relationship
This transformation is gathering momentum thanks to the authority of the data that digital marketing generates. “I see this from a local perspective in our daily interactions with sales,” says Masa. “It’s just a completely different conversation because of the data points we have and the agility they enable. We’ve been able to move on from touchpoints resulting out of habit to strategically adapting plans, rethinking the future, and making bold decisions based on data, which is helping us to achieve better results. Marketing now has the self-esteem to make change happen. It’s no longer just about gut feeling. We’re able to say, ‘this is what we did, this is what the data shows, let’s put more investment in to scale it – or let’s make a hard cut and rethink things.’”
With an increasingly digital buyer journey, marketing teams can generate a huge number of insights into the relevant target groups and their customer journeys throughout the entire funnel. They can find out about search behaviour and buyer propensities as well as gather invaluable data on customer experience and sentiment along all the touchpoints with a vendor. These insights give marketing the opportunity to take ownership of the entire customer journey and provide valuable insights to all customer-facing functions in a company, an opportunity that Kerstin and Masa are determined to grasp.
“We have to step up to drive the consistent, personalised experiences that customers now expect from us,” says Kerstin. “The more data we have, the more we’re seen as the orchestrator of all customer interaction. As a result, we’re able to take a bigger seat at the table – as a business partner rather than just an executional arm of sales. We have access to insights that aren’t as obvious to the salespeople who would normally own customer relationships.”
“To think beyond the right activities for engaging customers and look at the next stage and the question of how you build trust in a digital world is key for us,” adds Masa. “If you want to be successful in the B2B space, especially in an environment, where we sell solutions and services for complex customer demands, building trust is key. We’re convinced that we need to put the customer at the centre, not our products. We focus on peer-to-peer marketing showcasing the benefits SAP solutions creates for our customers through success stories.”
Responding to a changing tech buyer journey
At the same time as adapting to a digital buying process, SAP finds itself engaging with very different buyers. That’s partly a result of its expansion into new market segments – but also testimony to the changing nature of tech buying.
“I hear people talking about ‘the IT audience’,” says Kerstin. “In reality, that’s 15 different roles, each of which has different pain points and expects different messaging from us. It comes down to putting yourself in the customer’s shoes, asking which audience you’re talking to, what target you’re trying to achieve and what’s the best tactic for getting there. The decision-makers in the mid-market are mostly Managing Directors who wouldn’t traditionally be engaged by SAP. They don’t have much contact with our sales teams, and they don’t have that existing one-to-one engagement. That’s where marketing really needs to step in.”
Balancing local insight with global scale
Kerstin and Masa both occupy critical roles in a marketing organisation that balances the ability to scale campaigns with the requirement to stay locally relevant. “Everything that can scale needs to be done at a global or regional level,” says Kerstin. “However, at a global and regional level, you don’t know what the business looks like in Germany or the UK or Portugal, so you need that feedback from the teams in the market.”
This kind of local market insight is helping to steer the business towards areas of the greatest opportunity. “The longer the pandemic went on, the more we saw the need for digitisation and a growing appetite for innovation in the mid-market,” says Kerstin. “Smaller companies are investing in end-to-end digitisation to be better prepared for the future.”
The strategic decision to focus on cloud solutions enables SAP to tap into this broader appetite for innovation and transformation. Kerstin argues that the strategy the business has followed in difficult times is creating other forms of value as well – in the form of a brand that’s proven its commitment to customers.
The enduring power of brand purpose
“Customer success is our North Star,” she says. “We are only successful if our customers are more predictive, more agile and more innovative because of our products. The board had to take a tough decision last summer – not only to go with a strong cloud-first strategy but to put customer satisfaction and success first and short-term shareholder value second. COVID-19 is a curse but living up to our purpose has been a blessing for us. We’ve been able to show that we do want to make the world run better; that it’s not just about paying lip service to something. Purpose is what differentiates our brand, and it’s been that way for a long, long time.”
The SAP marketing organisation that’s emerged from the pandemic is different in many crucial ways. It has an expanded role across the business. It has become a champion of change and transformation. It has a strengthened, confident working relationship with sales, and it is leading the business towards new markets and growth opportunities. However, one thing hasn’t changed. SAP remains a brand built on actions, not just words. Its marketing leaders are confident that this will continue to be its greatest competitive advantage.
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