B-to-B Insights: What Are We Doing Here? (Part One)
Why B-to-B direct marketing works for me
June 2007 By Russell Kern
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Regular readers of this column may be surprised to learn that, although I’ve spent my entire career in marketing, I didn’t start out in B-to-B direct marketing.
Yes, Russell Kern got his feet wet as a general advertising account guy! And you know what? I’m glad I did. Experience in the general advertising world has equipped me—and, by extension, The Kern Organization—to better balance the requirements of direct marketing with those of branding on behalf of our clients.
But when it came to my own career choice, I found the requirements of B-to-B direct marketing to be considerably more interesting, more stimulating and ultimately more fulfilling than those of general advertising. I’ve never wavered in that assessment.
For the benefit of those who are still figuring out which advertising discipline is their true calling, I thought I’d use this month’s column to explore what it is I find so appealing about B-to-B direct marketing.
Knowing Exactly Where We Stand, Where We’re Headed, and How Much It’ll Cost to Get There
In B-to-B direct marketing, we eat, breathe, live and die by the numbers. Starting with revenue targets, average sales prices and number of sales reps, we work backward to set lead goals and program scope. Tangible goals are what determine that scope and allow us to map out our strategies.
Consider a hypothetical, but entirely typical example of a revenue goal of $100 million. Marketing activities normally are expected to contribute 25 percent to 40 percent toward the achievement of any revenue goal, so for the purposes of our hypothetical example, let’s set marketing’s contribution at 30 percent. This means our task is to generate $30 million.
As B-to-B marketers, we never leave an input meeting without learning the average unit price of the product being sold. After digging in our heels and pounding on the conference table, we’ve gleaned this number from sales: $150,000 per unit. Armed with this information, an easy calculation (revenue goal ÷ average unit price = number of unit sales needed) tells us we’re going to be held responsible for moving 200 units.
This is where the fun begins. Through a series of educated assumptions and backward calculations, we determine the scope of our program. We’re seasoned B-to-B direct marketing practitioners, remember, so we know we can assume the following:
• 50 percent of proposals lead to closed sales;
Yes, Russell Kern got his feet wet as a general advertising account guy! And you know what? I’m glad I did. Experience in the general advertising world has equipped me—and, by extension, The Kern Organization—to better balance the requirements of direct marketing with those of branding on behalf of our clients.
But when it came to my own career choice, I found the requirements of B-to-B direct marketing to be considerably more interesting, more stimulating and ultimately more fulfilling than those of general advertising. I’ve never wavered in that assessment.
For the benefit of those who are still figuring out which advertising discipline is their true calling, I thought I’d use this month’s column to explore what it is I find so appealing about B-to-B direct marketing.
Knowing Exactly Where We Stand, Where We’re Headed, and How Much It’ll Cost to Get There
In B-to-B direct marketing, we eat, breathe, live and die by the numbers. Starting with revenue targets, average sales prices and number of sales reps, we work backward to set lead goals and program scope. Tangible goals are what determine that scope and allow us to map out our strategies.
Consider a hypothetical, but entirely typical example of a revenue goal of $100 million. Marketing activities normally are expected to contribute 25 percent to 40 percent toward the achievement of any revenue goal, so for the purposes of our hypothetical example, let’s set marketing’s contribution at 30 percent. This means our task is to generate $30 million.
As B-to-B marketers, we never leave an input meeting without learning the average unit price of the product being sold. After digging in our heels and pounding on the conference table, we’ve gleaned this number from sales: $150,000 per unit. Armed with this information, an easy calculation (revenue goal ÷ average unit price = number of unit sales needed) tells us we’re going to be held responsible for moving 200 units.
This is where the fun begins. Through a series of educated assumptions and backward calculations, we determine the scope of our program. We’re seasoned B-to-B direct marketing practitioners, remember, so we know we can assume the following:
• 50 percent of proposals lead to closed sales;
Companies Mentioned:
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Business-to-Business Lead Generation Strategies (2nd Edition)
Business to Business Marketing Research