Jul 23, 2020

How B2B Hardware Buying Differs From Software Buying

The B2B buying journey is complex, even without factoring in the differences between buying hardware and software. 

Modern B2B buyers are comfortable researching solutions on their own using digital resources to inform them about new technology. But although common demographics and behaviors paint a picture of  today’s B2B buyer, the actual process of buying hardware differs from software/SaaS buying.

In this post, we’ll highlight some specific characteristics and behaviors associated with the B2B hardware buyer’s journey. As we approach Q4 2020, understanding how hardware buying differs from software buying can help technology marketers create an effective B2B marketing strategy for 2021. 

The modern B2B buyer is an enlightened buyer

A LinkedIn survey of over 5200 global professionals responsible for purchasing hardware and software, revealed that 86% of enterprise employees impact the technology purchasing process, either as end-users or decision makers. 

Source: LinkedIn’s 2019 Guide to the Enlightened Buyer

Today’s enlightened B2B buyers are largely Millennials, more than half of whom are younger than 36. This group of digital natives has the power to recommend and select new vendors via a process driven by their innate comfort with obtaining information on their own.

Even so, there is an incredible amount of pressure on buyers to produce results from their investments, likely due to the high rate of failure with IT projects. LinkedIn reports that failure rates for IT projects are upwards of 76%, with nearly 20% considered “utter failures.” 

It’s clear that B2B buyers have their work cut out for them, but enlightened buyers are well equipped to meet this challenge. From a hardware perspective, buyers are most apt to engage with vendors during the needs assessment phase of buying, when getting product specification and funding details, and during implementation of a new solution after a purchase.

Source: LinkedIn’s 2019 Guide to the Enlightened Buyer

How does hardware buying differ from software buying?

LinkedIn’s survey addressed twelve IT hardware categories from computers to printers/copiers to power & cooling systems. The results showed that all technology investments tend to focus on key business needs and infrastructure.

Respondents indicated that their most common IT hardware purchases in the past three months were laptops/notebooks, mobile devices including phones and tablets, monitors/displays, and accessories such as cabling. These same products were the most likely to be considered for purchase within the next twelve months, except for accessories (“services” trumped accessories as most likely to be purchased in the next twelve months.)

Source: LinkedIn’s 2019 Guide to the Enlightened Buyer

When organizations are considering buying new hardware, Operations departments have a high leadership roll in the decision. This is particularly true for data center hardware. IT and Engineering departments hold the most influence over all hardware purchases. 

The survey included nine resources that B2B buyers use when researching new technology solutions and it’s interesting to see how these sources differ (or don’t differ) for hardware versus software purchases. Here are some highlights:

  • Roughly 50% of hardware and software buyers rely on vendor websites/mobile apps as a top resource. This was true for both end user and data center purchases.
  • Product review websites were a key resource for B2B hardware buyers, with 43% of respondents listing review sites as a resource when buying hardware versus 33% for software buyers. 
  • Blogs, forums, and discussion boards are another key resource for hardware buyers, coming in third with 35% of respondents indicating they use blogs/forums to research hardware. 

The following table illustrates the different information resources that B2B buyers use when researching new solutions. The table includes comparisons between hardware and software purchases intended for end users versus data centers, highlighting which resources are used the most, based on the purchase category. Darker cells indicate that a particular resource is more likely to be used for the technology type listed in the top row of the table.

Source: LinkedIn’s 2019 Guide to the Enlightened Buyer

When considering a new purchase, B2B buyers have different priorities for hardware versus software purchases. Within the hardware category, there are also different priorities for end user hardware versus data center hardware, as demonstrated by the following table.

For end-user hardware, the following qualities will help your company make the short list:

  • Reputation-Reviews-Recognition
  • Quality
  • Needs-Requirements-Solutions/Understanding of Business

Now compare that to data center hardware:

  • Reputation-Reviews-Recognition
  • Needs-Requirements-Solutions/Understanding of Business
  • Informative/Information

If you’re a software vendor, making the short list of vendors requires a slightly different focus. For end-user software, vendors must fulfill the buyer’s needs requirements as the top priority, followed by having a strong reputation, and strong product features. For data center software, reputation/reviews are the top priority for buyers, followed by communication-responsiveness-availability and, finally, support.

More on the B2B hardware buying journey

The hardware buying journey itself has unique characteristics that marketers must consider when planning marketing initiatives, content, and strategy.

LinkedIn published an infographic illustrating some key statistics about the B2B hardware buying journey based on their own platform research. 

This research revealed that the average buying cycle for hardware purchases is 1.9 years from initial needs assessment to renewal! New vendors have a difficult time reaching buyers, with just 25% of B2B hardware buyers likely to consider a new vendor.

Source: LinkedIn

The top priorities for hardware buyers are similar to the needs of software buyers, with LinkedIn listing six key priorities. A hardware solution must:

  1. Offers easy Integration
  2. Be within budget
  3. Have a positive impact on productivity
  4. Be reliable
  5. Be secure
  6. Be a trustworthy/preferred vendor

The hardware buying journey looks roughly like this:

  • Needs assessment: Buyers start out with a needs assessment that includes key decision makers about 38% of the time and results in engagement with potential vendors nearly 80% of the time.
  • Specs and funding: LinkedIn reports that hardware buyers work with cross-functional partners for about 3.5 months when scoping out the viability of new solutions. During this process, they engage with decision makers about 30% of the time.
  • Vendor/product selection: The next step in the buying process is vendor selection, with decisions being made after reviewing/receiving feedback from multiple resources including internal stakeholders, product review websites, blogs, etc. The selection phase takes another 3.5 months, with about 25% of decision makers involved in the process, and just under 40% of the buying committee engaging directly with a vendor during this time.
  • Implementation: Once a new hardware solution is purchased, it takes about 4 months (on average) to implement. Just under 26% of decision makers are involved in implementation, with 45% of the buying committee engaging directly with a vendor during this process.
  • Adoption and Management: One of the final steps of the buying journey is adoption/management, which takes another 4 months to roll out. Vendor support is critical during this phase. About 21% of decision makers and 31% of the buying committee are involved in the adoption of new hardware technology.
  • Renewal: When hardware buyers have a positive experience with a vendor, they’re more likely to turn to them for future purchases. This phase typically involves 25.5% of decision makers with 40% of the buying committee engaging with the vendor.

Hardware purchases are complex, competitive, and take a long time

Businesses clearly face many challenges and complexities when purchasing new hardware solutions. The purchase cycle is long, the space is incredibly competitive, and the information available for a given solution can be overwhelming.

B2B marketers and tech manufacturers who take the time to understand the differences in the hardware buying cycle compared with the software buying cycle, will be better poised to reach buying teams at every phase of the journey. To this end, understanding the priorities of B2B buyers, how they obtain information, and the nuances of how they move through the buying cycle will ensure you create content and marketing strategies that meet the needs of this unique consumer. 

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