Ruth P. Stevens Articles and Columns

Ruth P. Stevens Articles and Columns: DIRECT Magazine

March 2005

What’s working now in B-to-B
By Ruth P. Stevens

Direct marketers are hot in business-to-business these days. They are developing new methods, introducing new tools, adding value all over the sales and marketing continuum. So what’s working for direct marketers today?

Here’s a round-up of some successful techniques I’ve come across recently:

Multi-word search engine bidding

Marketers have been all over keyword search for a while now. One of the latest refinements is multi-term bidding. Instead of simply bidding on the most generic keyword, which can cost $20 or even $50 per click, marketers are going for more specificity.

MarketMakers, a Wayne PA B-to-B teleservices firm, for example, conducted a pay-per-click campaign on Overture recently using a variety of search terms. MarketMakers’s objective was to find new clients, namely, companies looking for outbound telemarketing help. According to Chris Crafton, the Web marketing consultant who set up the campaign, the second-place bid for the term "outbound telemarketing" was $8.00, and represented 5,408 searches in the month of July 2004, but the second-place bid for "telemarketing lead generation" was priced at just $3.30. This 3-word term comprised only 348 searches in the month, but the audience is clearly going to be more qualified—as well as cheaper to reach.

The campaign results? From April 1 to August 14, the keyword-driven ads generated over 650 clicks, from 65,000 impressions. Some of the keyword terms pulled click-throughs greater than 6%. From an ROI standpoint, MarketMakers has already closed one new piece of business representing 10 times the value of the entire pay-per-click campaign. It also has a number of other deals in the pipeline that came in through the pay-per-click program.

Custom e-content

Email is arguably the most powerful vehicle for keeping in touch with customers and prospects. But given the likelihood that a legitimate business message may be confused with spam, customized content is increasingly important. "It’s all about relevance," says Elizabeth Darragh, director of marketing at IMN, an e-newsletter company based in Newton MA that allows users to create and manage their email-based publishing programs.

Shell Oil’s Lubricants Division for example, experimented with an e-newsletter for its distributors. Using IMN’s analytics tools, Shell was able to assess the varying needs of its distributor community, and customize the content accordingly. They were rewarded with open rates of 60%.

"Measurement is the other key to success," says Darragh. "With e-newsletters, you can measure relevancy and value by watching a variety of indicators, far beyond mere open rates. You can also look at which articles were most read, and the amount of time readers spent on a particular page." For Shell, the positive feedback from the distributors persuaded them to eliminate their semi-annual print newsletter—a major cost savings.

Dimensional mail to the executive suite

The gatekeepers are more vigilant than ever in keeping sales people away from the C-level executive. The most efficient way to get past the gatekeeper? A dimensional mail piece containing an attractive offer—something "lumpy"—delivered via an express mail service.

In a recent campaign for the business software company Captaris, the Hacker Group agency took this approach. Hacker’s goal was to get sales appointments for Captaris reps with the CEO, CIO or CTO in large financial services and healthcare companies. They created a package containing a remote control gadget inside a USPS Priority Mail envelope, and they sent it directly to the decision-maker. The accompanying letter spoke to the executive’s business problems, and offered a nice executive-style flat CD-stereo (that works with the remote) to be delivered by the sales person in exchange for the meeting.

According to Spyro Kourtis, the Hacker Group president, the Captaris campaign pulled 12% to 15% response rates—outstanding penetration of an otherwise highly resistant audience. Getting straight to the executive shortened the sales process substantially.

Webinars for lead generation and lead development

A Web-based seminar, also known as "webinar" or "webcast," has come into wide use in B-to-B. Webinars work best when you have a lot of information to communicate, especially when your product or service can solve a pressing business problem faced by customers. The security of their computer network, for example.

Last March, RSA Security, a Bedford MA provider of enterprise security software used a webinar to help them launch a new product that supports "federated identity," meaning the ability for companies to share sensitive employee identity information. The webinar was targeted to IT professionals who have an interest in security issues and need to get educated about this emerging category.

An analyst from Gartner was invited to be the featured presenter, and email invitations were sent to over 100,000 contacts, from RSA Security’s inquiry database and from websites specializing in security topics.

The invitation was sweetened with an offer to win a set of Bose noise-cancelling headphones in a drawing among webinar attendees. Michael Veit, manager of direct marketing at RSA Security, set his goal for the event at 1000 registrations, 400 attendees and 200 qualified sales leads.

The topic was hot. The offer was strong. The target audience was clearly identified. Veit.ended up with 1132 registrations, 481 attendees, and 233 qualified leads. Even better, the sales team has already secured 25 sales appointments, a 2.2% conversion rate on registrants.

Category-specific mailings

Instead of a generic mail piece sent to all campaign recipients, "versioning" is all the rage among B-to-B catalog and business services marketers. One place where this trend shows up clearly is the list rental approval process. Says Jay Schwedelson, vice president at WorldData, "For the B-to-B lists that we manage, it’s common today for the mailer to be asking the list owner to review 6 different mail pieces, instead of one."

Schwedelson observes that office products catalogers are crafting versions for industry verticals like government, healthcare and education. Naturally, the more relevant the merchandise mix and the messaging, the higher the response. The high-ticket order size found in B-to-B easily justifies the additional creative and production expense.

Web-based response management

The Internet can perform many functions for B-to-B direct marketers, but one of the most productive is using the Web to capture inquiries from online and offline campaigns, and then moving the prospect along the buying cycle via email communications.

Says Karen Breen Vogel, president of the Chicago-based Internet agency B2BWorks, "We are seeing clients pull 100% of their responses into the Web these days. This way, they get not only better lead qualification, but also better measurement and management. We host micro-sites where responses from trade shows, direct mail, and online advertising are collected. We then continue marketing to them via permission-based email, or we place the names in a database for future sales contact. Because the Internet is so interactive and so measurable, our clients can set benchmarks for themselves, constantly improving the quality of their pipeline by adjusting various components of the system: the media, the messaging, and the experience at the landing page."

Combining predictive modeling with campaign management tools

Hook up your predictive model to a campaign management tool and watch your business results accelerate. One example is cited by Carol Meyers, vice president of marketing at Unica Corporation, who works with WearGuard, a supplier of uniforms and work clothes. WearGuard uses an in-house telesales group to penetrate its customer base. The telesales reps held complete responsibility for managing their time and their call schedules—resulting in a haphazard work flow and much inefficiency.

Unica applied its Affinium software suite to score WearGuard’s customers—on a daily basis—to determine their purchase probability. Then, the system segmented the customers according to longevity, and determined the most appropriate offers for each account. Finally, the names and suggested offers were entered into the sales team’s contact database, giving each rep an actionable daily to-do list.

The process worked to improve the telesales group’s outbound call efficiency by 10% to 20%. At the same time, WearGuard was able to reduce its direct mail expense by $1-2 million per year without any reduction in lead flow. Best of all, WearGuard customers said they actually appreciate the calls. Instead of an intrusive sales pitch, the calls were viewed as a welcome customer service.

Campaign leverage by telephone

Using the telephone as a follow-up to direct mail is not new. It has worked for years, and still works. But the latest twist on mail-phone marketing is to focus the phone conversation on the core of the campaign, namely, the offer. According to Michael Brown, a leading B-to-B telephone marketing consultant, telemarketers and sales people often misunderstand the phone’s essential power.

"What drives me crazy," says Brown, "Is the ridiculous follow-up phone script that says, ‘We recently sent you a mailing with a promotional offer. Did you receive it?’ What a waste of time! At that point, we shouldn’t be talking about the mail. The mail is simply an artifact. We should be using the phone contact to sell the campaign offer itself."

Brown offers another example: Instead of "I’d like to speak with you about the white paper we sent recently regarding network security," the caller will be far more productive with this approach: "I’d like to speak with you about computer network security risks and two new ways to avoid them." The best calls are those that overtly ask the prospect for a next-step commitment.

Insert media

Billing statements, card decks, coop mailings and package inserts are picking up steam as a B-to-B customer acquisition vehicle. Pitney Bowes has reported success inserting offers for postage meters in billing inserts to American Express business card holders. A recent study identified over 350 B-to-B insert media options on the market today. The DMA’s 2003 Response Rate Study reported that B-to-B insert campaigns are averaging response rate of .98%—not bad, when you consider that the cost per thousand can be as low as $100.

Ruth P. Stevens consults on customer acquisition & retention, and teaches marketing to graduate students at Columbia Business School. She is the author of The DMA Lead Generation Handbook and a forthcoming book on B-to-B event and trade show marketing, from South-Western. Reach her at ruth@ruthstevens.com.

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