How would you address this tricky database marketing challenge?

A B2B marketer relies heavily on postal mail to promote their offerings. They use email marketing but have yet to see results strong enough to justify a reduced reliance on the Postal Service. Each purchase secured via postal mail averages $1,500; average lifetime customer value exceeds $6,000. The call-to-action is “buy now” (not lead generation), so response rates are fairly low. In fact, one purchase per thousand pieces mailed is an acceptable response rate. Customers and prospects in the marketing database receive no more than 20 mailings a year. Offerings are highly specialized, so the mail quantity for most offerings is relatively small. The marketer has not studied how different segments of the marketing database have performed over time. They know a significant percentage of the database is waste, but with a minimum of a .001 required response rate (a rate they often achieve), and insufficient frequency to study how recipients behave after many mailings, they’re reluctant to delete many records. (i.e., They’re concerned about deleting a non-responsive record after the 20th mailing that could produce a response on, say, the 21st mailing.)

Have a solution or know anyone who may?

Here’s our response:

I may be wrong but it sounds like marketing and sales don’t work together here – in fact there may not be any ‘sales’ folks in the business. I would also suggest having a discussion with sales to see if they’d consider moving to a lead generation model rather than direct response as that will almost certainly improve the metrics. Get Brian Carroll in to give an overview??

A bit of telephone customer research about historic purchase decisions that got insight into why they bought and when they bought may aide creating database segments and also migrating some people onto email; off the postal mailing altogether and improve the metrics of this offering in the long term.

What’s in the series?

• 8 steps you can do today for improved lead generation
• 5 ways to focus on your targets
• 2 improvements for a compelling offer

Short, easily digestible advice delivered to your in-box in five installments.

Interested?  

To summarise their web service we have made a short overview outlining the major steps.

Recently I was asked how would I write an introductory letter to send prior to cold calling?

My answer “I wouldn’t”.

Reasons to write

There are a couple of key reasons people send an introductory letter:

• They believe it will be read and as a result the prospect will be more open and receptive to their call.
• It makes the call feel less cold so makes making the call easier.

The reality:

The vast majority of your mailings will go straight in the bin, a few will get skimmed first and then binned.  A few will find their way into a pile and become buried, and if you’re lucky and the gods are on your side a few may actually get read.

When you call

So how does this translate for someone receiving a call from you?

If they just skimmed the material or binned it without reading it they probably have no memory of ever receiving it.

Straight away this triggers two doubts:

1. Did you even send them anything or is this just a gimmicky opening you use to get them chatting?
2. Secondly, if you did send them something it must have been of no interest to them or they would have remembered it.

This is not the best footing to start a call.

In short, pre-mailing prospects is time wasting, ineffective and often leads to doubt and mistrust in the minds of those you call.

Invest your time and energy into making more calls and asking more people to take the next step with you.

Success belongs to the askers, so stop mailing and keep asking: the results will speak for themselves.

Paul Foley, Noodle Coaching

Thinking about selling – the actual process of finding a prospect and communicating with them until they are prepared to hire your company, is something that isn’t often talked about in professional and creative services organisations.

“Sales” is still a dirty word for professionals.  We don’t like the implications of pressure, cold calling, the lack of perceived sophistication and down-and-out heartlessness of the salesman.

And yet, it is not only relevant, it is very rarely practiced with any success in creative agencies.

Why?

Well, we would really rather sit back and let the phone ring than go out and create opportunities for ourselves.  The implications of ease versus hard graft are hard to avoid.

Brian Carroll writes the Start With a Lead Blog about B2B Lead Generation .  His customers are usually corporations, frequently selling complex services who take time to go from first enquiry through to completed signed deal.  Sound familiar?  Well, yet it should do.

We all sell customised products and services to a discerning clientele who want carefully thought-out solutions to their marketing issues.

Complex?

Yes it certainly is.

Brian has written a series of posts on a check list for lead generation.  Part 8 has just published and in it he summarises the key points from the whole series.

I commend you to read it carefully and to check back the previous 7 parts.

Check list for your agency

• Ideal customer profile
• Database accessable by all staff
• Clear Biz Dev process
• Rewards for successful sales
• Analysis of failed leads and opportunities to re-contact them
• Future date tagging for callbacks
• Compelling marketing positioning for the agency brand

I believe that we can always improve our internal biz dev processes.  Why not start the new year by setting aside some time to work with the newest joiner to your team.   Take them through the ‘logic’ of your process, positioning and sales pipeline.   Then invite them to pick two other people from the agency to continue the work with.  Ask them to explain what they heard from you to the first person and then to get that person to take it onto another who writes down a summary and hands that back to you.  Chinese whispers for biz dev.

See where your ‘logic’ breaks down, where your process was mis-understood and mis-interpretations that occurred in the three-fold explanation process.  What did you learn?  What can you simplify, clarify or remove to make the linear biz dev lead generation easier?

What is your opinion of sales for professionals?  Do you have a story to share?

1. Keep a narrowed focus on the companies that are most likely to buy from you.
2. Review all customers over the past year and categorise them by value (how much they spent) and business type (their needs, industry sector, size, services bought). 
3. Check that your findings match the companies and consumers in your target groups.  If not – re-focus onto those groups
4. Review the Profile Raising activities you have planned for the next 6 months – will you be getting in front of the right people?  If not, change the plan.
5. Check your database of companies fitting your new target criteria.  What Relationship Development activities have you done with them over the past 6 months and what do you have planned?  

For myself – I found that I was Profile Raising at one place that is not likely to get me in front of prospective clients.  It's a networking event that is fullof enlightened technically-savvy folks who are freelancers or run small / micro businesses.  It is now a luxury for me to go to this event.  Not a necessity.  I have prioritiseda different weekly event for my attentions.

I am also working harder on my database.  I aim to input around a dozen new contacts per week, all researched and verified into the database.  Those whofit my target criteria are receiving a new direct mail approach with a specific offer.  I'll update later on how this is going.

STATUS UPDATE: In my pipeline now I have 

14 at Prospecting Stage [note eliminated 5]

7 leads at Qualification Stage

3 lead at Needs Analysis Stage 

1 lead at Proposal Stage [same one as last time]

Here are some early plans you can put in place to ensure that your business does its best to survive.  I am starting with Lead Generation.  This is the earliest part of the business development cycle where your marketing communications have attracted a prospect to begin a conversation with your company.

1. Eliminate prospects who won't buy from your pipeline
2. Qualify your leads very carefully – ask golden questions , listen twice as much as you speak
3. Get the remaining prospects to acknowledge that they have a need
4. Nurture these prospects.  One response is not enough. 
5. Build a relationship with the prospects – it will take at least 3 "touches" to convert
6. Plan for a longer lead cycle
7. Manage the hand-off between sales and marketing carefully.  Writ large this means a weekly discussion with all parties involved in Biz Dev planning exactly what to do with every lead and understanding who will do what, when to whom. Micro-manage this in a recession.
8. Track your metrics – the % of opportunities that become clients.  This number will change and you need to be on top of what is influencing that change.

Let me know how you get on.

P.S. Just to be brutally honest, I'll be trying to take my own 'medicine' too and so here is the state of my personal business development pipeline October 2008.

STATUS UPDATE: In my pipeline now I have 

20 at Prospecting Stage

6 leads at Qualification Stage

1 lead at Proposal Stage

1 lead at Closed – project won (this morning – Celebrate!)