Product Marketing vs. Portfolio Marketing: Which is More Effective in B2B?
Understanding the distinction between product marketing and portfolio marketing can be simplified by considering the saying, “the whole is greater than the sum of its parts.” Your portfolio brings more value to the market and customers than the individual products within it.
Product Marketing Explained
In a B2B context, product marketing focuses on highlighting the value of individual products. The goal is to show how these products make users better at their jobs in ways that provide strategic benefits to their organizations. For example, an accounts payable solution could improve an organization’s cash flow by eliminating invoice errors, thus preventing overpayments, underpayments, and penalties.
The main role of product marketing is to promote the product’s value and build strong sales pipelines. It ensures that the sales team can clearly communicate the product’s value at various stages of the sales process with the help of supporting tools. Ultimately, product marketing aims to increase revenue from existing products and grow their market share to support the company’s financial and strategic objectives.
Defining Portfolio Marketing
Portfolio marketing in B2B focuses on demonstrating the value of the entire portfolio to specific industry sectors such as retail, healthcare, and manufacturing. The objective is to show how these portfolios strengthen organizations within those sectors. For instance, marketing an “enterprise financial management” portfolio to hospitals could emphasize how it gives them a competitive edge through better financial flexibility to execute their strategic priorities.
Relationship Between Product and Portfolio Marketing
Product marketing serves as a subset of portfolio marketing, specifically addressing needs in areas like accounts payable, accounts receivable, asset management, and financial reporting. The difference lies in how each product’s value is linked to a common industry theme to create a cohesive and relevant story for each market segment. A well-orchestrated portfolio marketing plan positions each product within a broader industry context, thus giving the organization a competitive advantage and making it a high-quality provider in its field.
Advantages of Portfolio Marketing
Portfolio marketing, also known as industry marketing, promotes the portfolio’s value to specific industries, ensuring the salesforce can communicate a strategic and differentiated value story for each market segment. This approach is particularly advantageous in B2B since it provides higher relevance for each industry, demonstrating your vision aligns with your target customers. The ultimate goal is to increase revenue and market penetration in specific segments rather than focusing on individual product performance.
Choosing the Right Marketing Approach
If your products are in a highly competitive market, portfolio marketing can help differentiate them by making your marketing and sales conversations more relevant to buyers in each segment. However, if you’re introducing a relatively new product category and aim to capture market share, product marketing with a generic approach might suffice initially. As the market becomes more crowded, transitioning to portfolio marketing can help sustain growth.
Transitioning to Portfolio Marketing
To shift from product marketing to portfolio marketing, start by identifying market segments where you have the most successful customers and where your product category is growing fastest. Develop industry-specific messaging and integrate it with your product messaging, ensuring strong context for each industry vertical. Spread this through your salesforce and marketing channels, build out essential sales tools, and you’re on your way.
The Bigger Picture
The way you market your products is an extension of your product management strategy. Many B2B companies hesitate to target specific vertical industries, fearing they’ll miss out on opportunities in other areas. But, a significant portion of revenue typically comes from a few key industry segments. Focusing on these can make you better than the competition as long as there’s potential for growth.
Product marketing can easily go vertical if supported by product management, which can add a few industry-specific features to a mostly horizontal platform. A portfolio approach from product management can deliver greater value when all product teams view their markets holistically instead of in silos. Ultimately, the decision between product marketing and portfolio marketing hinges on what will drive your organization’s success.
Is it more beneficial to lead in a few industry segments or to offer a generic solution across all segments?