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Carilu Dietrich | B2B Marketing - 2024 The Year in Review + The Year Ahead | CMO Confidential
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- [00:00]
Mike Linton
The CMO Confidential Podcast is a proud member of the I Hear Everything Podcast Network. Looking to launch or scale your podcast, I Hear Everything delivers podcast production, growth and monetization solutions that transform your words into profit. Ready to give your brand a voice then visit iheareverything.com welcome to CMO Confidential, the podcast that takes you inside the drama, decisions and choices that go with being the Head of Marketing. Hosted by five time CMO Mike Linton.
- [00:38]
Welcome marketers, advertisers and those who love them. I'm the Chief Marketing Officer, Confidential. CMO Confidential is a program that takes you inside the drama, the decisions and the politics that go with being the Head of Marketing at any company in what is one of the most scrutinized jobs in the executive suite. Mike I'm Mike Linton, the former Chief Marketing Officer of Best Buy, ebay, Farmers insurance and ancestry.com now today's show is brought to you by Props. Props is a performance driven content platform which combines the attraction of creator content with the results of paid media. Instead of impressions and posts, Props takes responsibility for leads and customers. Now I'm here today with my guest Carrie Lou Dietrich. Today's topic B2B marketing, the year in review and the year ahead. Now Carrie Lu is a former cmo, was the Head of Marketing for Atlassian who took the company public. She now advises hype for growth startups like Bill1Password and Sprout Social. We met through CMO coaches and are both faculty at CMO Bootcamp. She is a regular B2B correspondent and a CMO Confidential OG due to her deep knowledge and involvement in all of the B2B issues. She's here today to give us an update from the front lines. Welcome Carrie Lou Thanks.
- [02:06]
Carrie Lou Dietrich
So excited to be here.
- [02:08]
Mike Linton
All right, it's been about six months since we last talked. Let's check in on your view of the health and financial trend lines in the B2B space. Give us the 30,000ft foot overview.
- [02:23]
Carrie Lou Dietrich
Great. 2024 was a tough year for marketers. Budgets were still tight, software spending was still tight, and the world as we know it is changing. Around us. AI native companies are coming in and eating the lunch of traditional software companies. Traditional software companies are trying to rapidly adapt AI into the models that they've already been so successful in. But everything is changing. I think 2025 is going to be the year of the most marketing change in my entire career and a lot of this is built on the back of things that have come before. I'm seeing that companies who have really exceptional data stacks are those that are able to use AI fastest. And companies that are willing to experiment with new ways of interacting are launching products to compete with AI natives that are more effective. But you know, everything's really changing. 2025 is going to be a positive year I think for the economy and for investments, but the pressure is on.
- [03:32]
Mike Linton
So is it fair to say BNB B2B is in a transition year or a revolutionary year?
- [03:40]
Carrie Lou Dietrich
Well, there's two big things happening at the same time and one is the macro market. So we know with the change in the administration that there's a lot more confidence in business friendly policies and regulations. And this is going to make two big differences. One is going to be in whatever happens with the interest rates and support for more fluidity of money to make investments. The second that's really significant in the B2B space is potential changes with the administration around regulation of mergers and acquisitions. So over the past few years the Federal Trade Commission has been very aggressive about anti monopoly, stopping, yeah, stopping, stopping acquisitions. And while it could make sense for the consumer from one perspective, on the other hand it's created this stalemate where larger companies aren't able to buy smaller companies, which means that investors can't recoup money to invest back into earlier stage startups. And with the interest rate problem plus the mergers and acquisitions, it just created this time of real like a stalemate in liquid, you know, making B2B companies investors liquid. And so that has slowed down investments that allow companies to grow. It slowed down software buying budgets because companies don't have as much to spend on on other software. So that the combination of the interest rates being decreased and the mergers and acquisitions potentially being seen more favorably could allow for more dollars to invest. And just this week I heard one of the very top venture capitalists mention in a private setting that software buying is warming up and he expects this year to be a positive growth year in the software space.
- [05:38]
Mike Linton
Not just economic, maybe tailwinds, regulation, maybe in a little bit of retreat. And also we have to talk about AI. So this business is, you know, all that stuff you talked about is the landscape. And then maybe driving all of this is we got AI sitting there, you know, and every. You just said the AI native companies are kind of having their way with the marketplace. Everybody's claiming they have AI in their platform, everybody's in their product, everyone's claiming they can consult on it. Tell us what's really going on in the B2B space with AI and how people can separate the fakes from the real players.
- [06:27]
Carrie Lou Dietrich
Yes, I would say AI is not just sitting there, it's smacking everyone in the face and it's doing that in a couple of different ways. So one, as the economy is showing potentially more promise, marketers are being given growth goals with not significantly more budget. So growth goals are growing faster than the marketing budgets are growing. We're still in some efficiency, but at the same time, most companies are losing significant portions of of their top of funnel awareness because of the changing behavior of search. So several CMOs I've talked to are losing anywhere from 15 to 20% of the inbound traffic they would get from search results.
- [07:10]
Mike Linton
Let's make sure everybody knows what's going on and correct me if I'm wrong. As more and more consumers go to AI, there's less and less search and there's more and more answers. So getting leads coming into the top of your funnel is a lot harder than it used to be. Is that fair?
- [07:27]
Carrie Lou Dietrich
Correct. Then they're calling it zero click search. So basically you used to search and get a couple of advertisements from Google + organic results that you would click in to find answers. And often for companies, some of the highest performing is what is something in our category. When I was Atlassian, our number one highest performing page was what is agile? Agile being a software development methodology. And we were, we, we dominated for, I mean that was the top performing asset for seven years. SEO was kind of the bread and butter of how we were able to grow so quickly, spending so little by being an authority on, on a search engine. But Google is rapidly losing search traffic to ChatGPT. And also Google itself competing with ChatGPT has put Gemini answers at the top of search results. So you get the answer, you get educated. There may be reference points, reference pages that are mentioned in the search result, but at a lower rate. And also I'm hearing a number of CMOs say that the search results are less discerning than obviously a human might be. So if a competitor says we are number one on their website or there's an affiliate site where they paid to be ranked higher, sometimes the AI answers give the user again, not the like. What is the actual hierarchy?
- [08:57]
Mike Linton
Instead of homework? Yes, instead of user homework that you got with search, instead of being a little bit of work, you get answers.
- [09:04]
Carrie Lou Dietrich
Now you have an answer and that answer may or may not be true. I mean outside of trusting the wrong pages, we know that most of the frontier models right now are inaccurate and hallucinating. 20, 25% of the time.
- [09:19]
Mike Linton
Well, we did a whole show on this called your next best customer may be an AI bot where it said, you know, consideration is in. The premise is consideration is in decline and also searches in decline. So if the ad bot doesn't find you, your brand is not there. And so by definition your lead's not there. In B2B, this may be very, very costly, costly for Everybody. But in B2B where leads are so sometimes so long term could be a lot tougher. So we talked about AI kind of impacting everything on the top of the funnel. Let's talk about the bottom of the funnel and then let's also go to budgets because a lot of people are saying, okay, you got aa, now you can save a lot of money. Let's talk about all of this together and planning for the CMOs in 2025.
- [10:13]
Carrie Lou Dietrich
So one of the interesting that's happening, things that's happening is that AI software purchases are starting to take away from headcount budget. So we're seeing this in a couple of places in production this year, I would say 2024 was the year of AI experimentation. 2025 is the year of AI and production for marketing. And the two big, the three big areas. One is in content creation, which so much has been written on, I'm not going to go deeply into that today. The second one is in sales development reps. So in B2B you get people come to your website and they're interested or they read an article or they see an ad and then if they've shown enough intent and you've scored them, you send them to a junior sales rep who calls them and tries to book a meeting for a real sales rep or give them a demo. And we call these sales development reps or business development reps. And these are very junior entry level people who are being replaced by AI.
- [11:11]
Mike Linton
And it's AI as an agent actually. Right. They are almost harvesting these people.
- [11:19]
Carrie Lou Dietrich
The way it's working today is as well. There's two ways it's working today. One is as a smart assistant. So it's, you're teaching it based on all the content of your business, how to write smarter personalized emails to reach these individuals who have shown some interest. In many cases, SDRs are able to approve, check and send these out. So then it's, it's an assistant still not an agent. In another way, there's some chatbots that are autonomous in responding very quickly, engaging in two way conversations and then flipping the conversation to a human if it gets outside and so we're seeing some of these built on top of technologies like Qualify, a company called Qualified, which has a website chatbot, companies like 6sense who does AI intent, data drift, who was a chat, an interactive chat website bot before. So these kind of two way conversations. It's not exactly agentic yet, but the agentic stuff is coming. And Deloitte said that 25% of enterprises who are using General Gen AI are going to deploy agents this year. So again, massive change of behavior, massive change in how to reach consumers through the one click search and through agents. And there's no real long term experts that we can hire because it's new for everyone.
- [12:45]
Mike Linton
Oh, but if I'm sitting there as a CMO or anybody actually interfacing here, what I'm getting from the company is look, save some heads with this and then we can actually process a lot of this stuff faster as well. So keep your growth target, save this money, get this all done. Is that kind of how the budget is coming together or what are you thinking? As people lock down their budgets for.
- [13:09]
Carrie Lou Dietrich
2025, there's definitely a group of have and have nots. So AI first companies are getting huge valuations, they're getting big investment rounds, there's a lot of money going into and they're getting much bigger budgets because it's an absolute race. Right. There's a big question on the Frontier models. OpenAI has just hired a new CMO coming out of TED Meta Anthropic is on the hunt for their CMO. Can, is there, is it possible that they can catch OpenAI Big open question. But they're going to put investment dollars against that in a really significant way. And we're seeing that in larger and smaller ways across different markets, across vertical AI packages, you know, AI native security. So there's a bunch of marketers out there who are getting big and sometimes almost unlimited budgets to try to capture a market faster than everyone else. And then there's there's the kind of an everyone else, right, Everyone else being.
- [14:10]
Mike Linton
These tools versus selling them. Yes, but everyone else.
- [14:14]
Carrie Lou Dietrich
So I would say there's a lot of SaaS, companies who are still in a relative efficiency model. So they're targeting growth that, that's bigger. You know, hyper growth is much less frequent outside of AI companies and security companies. But, but maybe they're targeting 20 or 30% growth on the higher end and, but budgets aren't going up by the commensurate amount so, so they're being asked can you do, can you do more in New ways more efficiently. And you know, if the market is indeed positive and there's some wind at our backs this year, that'll help conversion rates and help marketers who might not be able to reach aggressive pipeline goals if salespeople can sell faster. To be to be seen.
- [15:02]
Mike Linton
So let's see, there's all this positivity behind what you just said. Industry into transition in general. Are CMOs and companies going to set realistic budgets or are people going to be clawing their way to the numbers at the end of the year? Just an overarching look at the B2B space from someone who's in it every day.
- [15:25]
Carrie Lou Dietrich
I predict clawing their way whether you're at a medium or high growth company. I've never been more stressed than some of our best years at Atlassian where we were growing like crazy. But the question is, if you can grow 40%, can you grow 80%? If you can 2x, could you 5x? So you know, I think across the board there's aggressive growth targets. It's just relative to what starting. Starting point.
- [15:51]
Mike Linton
Yeah. So I think a bunch of people could risk what I'll call stacked hockey sticks here where you're going to have the great impact from AI, great impact from the economy and hopefully lower inflation and great impact because the business is booming. So here's your plan. Go get it, tiger. And I think that might be a little hard. I'm with you on the clawing thing. Let's talk about how people might claw their way to these probably very aggressive growth targets. Because we talked about search being in decline and we know a lot of traditional marketing tools are in decline and folks are looking to social channels and influencers. How is this all unfolding in the B and B space?
- [16:37]
Carrie Lou Dietrich
It's exciting to see so many boring parts of marketing that could be radically improved by AI. So a lot of the places, you know, we've always had troubles with, with sales development reps and inside sales because they weren't responding quickly enough. They're inexperienced from a business perspective. So they don't actually create engaging content.
- [17:01]
Mike Linton
Create tactical dull. Get myself next week in context.
- [17:06]
Carrie Lou Dietrich
So in some ways, and then. And then also I'll say the other big place I'm seeing some huge ROI for companies is in data Insights, a bunch of thing that the data team was trying to clean data and organize data and augment data. I mean there's a bunch of stuff that has been operationalized in marketing that AI is going to make faster and more efficient. Taking things from months to Weeks, weeks to, to days, days to minutes. I mean there's some, some huge gains that we're seeing. But what that means is, is the pressure is on for brands to be more human and we're seeing that already. Where executives are taking a much more ac. Active role in social media. YouTube is the number one or sorry the number two search engine after Google and has more search than all the other search engines combined. Video, short form video. And then you know, for business to business brands. Events are back. So people like to go back to large scale events but almost every company I talk to is having a real focus on smaller, more intimate, more meaningful peer events, customer events.
- [18:14]
Mike Linton
Is that like a d, is that like dinners or is that like smaller conventions or small get what, tell me what you mean by smaller events.
- [18:24]
Carrie Lou Dietrich
So people are craving real human connection and trust of, of insights. And you know, that's one reason your podcast is going so well. You know we could ask ChatGPT, how do you be a better marketer? And you're going to get some average of the Internet examples. But when you bring on the best and smartest people and we learn from them, it, it feels and you give us tactical examples of what we should do. Our trust in you as a five time cmo, our trust in these amazing people you bring on lets us know that that information is valid. And the same thing is happening. You know, customers and prospects want to meet with CEOs, they want to meet with product leaders, prospects want to meet with other customers. So we're seeing that more of being dinner series, you know, smaller, 20, 40, under a hundred people, regional meetups where people are talking about product and they're getting the human insights and building on the trust. So on the one side we're seeing more automation with real personalization, but on the other side we're seeing big investments in the human across social media, video and in person meetups.
- [19:30]
Mike Linton
Well, I want to talk about video in a minute, but I want to make sure we're talking about this question in depth. So does that mean things like Dreamforce and all the giant get togethers where thousands of people confab about a bunch of B2B issues, are those going to decline or are those going to stay in place and everything's going to build out around them? On the individual level you just talked.
- [19:54]
Carrie Lou Dietrich
About, it's a, both, it's not a replace in this, in this age, hopefully some of the online aspects become more automated and more effective. But people are going to continue to have these massive user conferences, you know I was at Dreamforce this fall. I was at Nvidia's conference. I've been at at many of these different conferences and they're as big and amazing as ever. There's chances for people to connect there and there's a lot of B2B that's doing much more targeted, deeper selling through smaller events.
- [20:30]
Mike Linton
So if I, if I think about this and you can tell me if I'm getting this wrong, this is almost like a barbell effect where AI is driving one side of this barbell which is a lot of traditional marketing tools I use to fill the top of the funnel are gone. And so I'm not going to get super efficient here. The middle of the funnel is quasi disappearing because a lot of those tools don't work the same. But the bottom of the funnel where I meet you at Dreamforce or one to one or at dinners, that's going to increase in importance. Is that fair?
- [21:03]
Carrie Lou Dietrich
That's absolutely fair. You know there's several mega trends that are coming together in marketing and, and you're right, absolutely. If CMOs are saying they're losing 15 to 20% of their search results for some of their top performing horizontal search for terms, you're absolutely going to have to figure out new ways of filling the funnel. And if you can't fill the funnel, it's for right like top of funnel leads go into a conversion rate of how many get closed into revenue. So if your top of funnel is down, you've got to increase your conversion rate of how well salespeople work those leads, how effectively they sell them. And then the other thing that's happening with marketing and this has been happening for a number of years and thank goodness for us, you know, ambitious marketers, it's, it's maturing is more effective targeting and more effective identification of people who are in market and are the right target audience for your business to business products. And so there's a number of different intent engines. Six sense and demand base are two of the big ones for enterprise business to business. But this is the ability of people to look at different engagement points across the Internet to, to help marketers target and market to people who are actively looking before they would engage with a company.
- [22:27]
Mike Linton
Well if I carry this side of the barbell down to its extreme end, every lead is super valuable and super important and you better close on it because the days of fishing with a big net are probably over.
- [22:40]
Carrie Lou Dietrich
I think that's right. Until we figure out what the next Google SEO is.
- [22:44]
Mike Linton
There we go.
- [22:45]
Carrie Lou Dietrich
I'm old enough to remember when we started doing Google SEO and we never.
- [22:50]
Mike Linton
Talk about any on the show. Carrie Lou.
- [22:52]
Carrie Lou Dietrich
We had an a. We. Yes, we had a digital marketer on the team and now that's laughable. The whole team is a digital marketing team. And, and SEO has been such mana from God from the last, for the last 10 years and right now in 2025 that might be taken away from us and we've got to figure out what's next. And is that video? Is that you think you one of.
- [23:15]
Mike Linton
The things you think video is going to become more important? Right.
- [23:19]
Carrie Lou Dietrich
I just watch my children and I watch how well consumer brands market to them on TikTok. My kids have me at Ulta and Sephora buying the latest this and that and then I look up some professional reports and they really are the top brands doing something right.
- [23:35]
Mike Linton
Yeah.
- [23:36]
Carrie Lou Dietrich
So I, and I also see, you know, brands and business to business especially has traditionally had a very high bar of excellence for video production. And that's expensive and it's preventative. And if you look at what's happening on TikTok and YouTube, what we're seeing is people recording videos of themselves being real and authentic in a messy bathroom with like old crazy colored, you know, sinks like things that you and I would be absolutely embarrassed to ever put on the Internet. But that's what's creating these relationships. And I think we're going to see rapidly created user generated content, rapidly created company generated content and all sorts of lower bar video become a vehicle for more education, more engagement. You know, people love reading and listening and getting information from video. And if you look at the stats, almost everyone wants more video from brands. And so if brands can start to meet that by having more velocity at a lower quality bar and more user engagement, perhaps that starts to fill some of the gap of what we're losing with the online education that Google SEO was giving before.
- [24:52]
Mike Linton
So this is an interesting discussion. We'll watch video this year and see how it develops. But I hear you saying it's really all about that super targeted video versus that mass produced video that's going to win the game here. Is that fair?
- [25:09]
Carrie Lou Dietrich
Again, I think that the way people consume information has totally changed. I had a slumber party of 1013 year olds at my house this weekend.
- [25:19]
Mike Linton
Sounds like scotch. You need scotch to be ready for that.
- [25:23]
Carrie Lou Dietrich
Well, it's my own marketing focus group so we, you know that in the plan, in my Excel spreadsheet it said movie, Christmas movie and they were going to watch a movie and Then we went and tried to talk about the movie, they couldn't agree. And then all the girls got on their phones and had different kind of entertainment and were talking and laughing and gossiping like this, like personalized self service entertainment. We're seeing that translate across the corporate world. You know, like you can't reach people with TV in the same advertising channel, but you definitely can on all this targeted YouTube that not only reaches people effectively but around micro interests that are more targeted and effective. So I expect that the advertising vehicles around social media, around AI. Right. Perplexity is going to put ads in some of their results eventually. ChatGPT, Anthropic and the others, you can only imagine that they will have some sort of ad platform when that becomes part of their monetization strategy. So I think we will continue to see vehicles for more advertisers to reach people more effectively and it will be more personalized.
- [26:32]
Mike Linton
Got it. So we've talked about budgets, we've talked about marketing tools. Let's talk about what agencies and marketers should be testing in 2025 that they are going to absorb those test results and be ready for 2026. Give our agencies and marketing folks some advice about that topic.
- [26:56]
Carrie Lou Dietrich
It's a little bit dependent on their specific area of focus, but at risk of restating what I've already said. Absolutely. On the data and data analysis, although we still know AI is hallucinating so we've got to be smart about that. Absolutely. On the, for B2B, on this sales development rep, inside sales, early stage reps, how do we make those, how do we give those people twice the territory and, and goals without hiring two times more employees. Also on the content and AI optimization, we've got to both be optimizing for AI search results so that we're, you know, if only one answer is going to show up, we sure hope it could be us. And also optimizing our site to be better consumed by AI. And then I think last video and, and video not just as a, an educational platform but as a social media vehicle for building the brands of your top executives and top customers.
- [27:57]
Mike Linton
And if I tear this all apart and re restructure it, I hear you say don't look at the marketplace as pieces like you may be used to like acquisition and leads and look at leads as a process top to bottom, get them all the way through the funnel and recognize that customization of leads is where things are going as it's closing the lead. So you've got to start thinking about this as A whole process. Is that, is that like rethink it given all these changes, is that fair?
- [28:28]
Carrie Lou Dietrich
Absolutely. Marketers aren't successful until the deal is closed. And in consumer that's a much shorter window. In B2B it can be a month, but it can also be three to six months or six to nine months or nine to 12 months longer. Yeah, those deals. So marketers are responsible not only for this top of pipeline awareness, getting leads, passing the leads to sales, but making sure that we continue to nurture all the contacts on the buying committee that bring it all the way to closed revenue and then after that to being evangelists that spread your product through word of mouth. And again, that also is one of Atlassian's core plays, getting people so excited about your product that they're sharing with other people and that that's a huge dark funnel of opportunity.
- [29:18]
Mike Linton
All right, so I think that's a good way to get to our traditional last question. Funniest story you can tell on the air and or practical advice we haven't discussed yet. Pick one or both, but you have to pick at least one.
- [29:36]
Carrie Lou Dietrich
This one always creates stress. I've been worrying about it for days.
- [29:39]
Mike Linton
Because I'm not out on that with you.
- [29:40]
Carrie Lou Dietrich
On these shows I'm not funny, I'm just earnest. In fact I once had to do a speech at a wedding that I thought should be funny and I stressed so much that the whole speech was me about stressing about not being funny, which turned out to be funny funny. But my my recommendation would be to get your hands dirty. I've been subscribing to ChatGPT Premium and Anthropic Premium and using them for all sorts of things. The feeding schedule and calorie and mineral needed for my guinea pig travel ideas, birthday ideas. Analysis of top venture capitalists I read a blog called Carrie Lou.com and I did an analysis of the top venture capitalists on this Forbes Midas report over the last 15 years and I tried diligently to get ChatGPT to analyze different pages and cross reference things. And each of these experiences trying to get it to create images are both incredibly frustrating but create so much insight into where the tools are now and how we can get our team to use them. And really my conclusion is the more sophisticated you are in an area, the more effective you can effectively you can use AI to get good results in that area. So get your hands dirty and buy some of the premiums that that have better results.
- [31:05]
Mike Linton
We use it a lot on on this show for a lot of the the background work and also any of the viewers or listeners to CMO Confidential that want to download the guinea pig schedule, I'm sure that Carrie Lou will either post it in comments or share it with you. So I think that's a great way to end the show. AI with the guinea pig meeting schedule, if it goes wrong, the guinea pig is is out of luck.
- [31:31]
Carrie Lou Dietrich
So don't joke. We lost a guinea pig because.
- [31:36]
Mike Linton
Dear anthropic and chat GPT, my guinea pig is dead because of you. All right, so with that, we'll close on the show. Thank you, Carrie Lou, and thanks to everyone for listening to CMO Confidential. And a special thanks to our title sponsor, Props. Look for Mariner shows on Spotify, by Apple, YouTube and the I Hear Everything network, which include why is B2B marketing so bad? And what to do about it, parts one and two is your next best customer and AI bot and of course, Carrie Lou's previous four shows, including the top five reasons B2B CMOs get fired and what it's really like in the B2B startup world. Hey, all you you marketers, stay safe out there. This is Mike Linton signing off for CMO Confidential.