B-to-B Special Report: Put the Direct Back Into Direct Mail With Credit Scores
Big corporations might get the lion’s share of business headlines, but the truth is that business in America mostly means small business. Two-thirds of the nation’s new jobs and 40 percent of the U.S. gross domestic product are created by small businesses. Nearly all companies nationwide—99 percent—have fewer than 500 employees, government and industry figures show.
That’s why any company planning a large-scale, sophisticated effort to seek out potential B-to-B customers will go where the action is: small- to mid-size businesses. They add up to a huge market for credit card companies offering professional cards, insurance firms rounding out commercial portfolios, office furniture outlets selling desks—for just about anything. Targeting small businesses, however, comes with significant risks along with opportunities. This is a roiling world of new ventures, heady expansions and more than a few crash-and-burn failures.
How, then, do you build a better direct mail campaign? These days, smart marketers are turbo charging their lists by folding creditworthiness data into the mix, creating a powerful tool that puts the “direct” back into direct mail. An overlay of credit data helps you zero in on the best customers, build on existing relationships and avoid making sales pitches to businesses on shaky financial ground.
Credit Scores and the Direct Mail Process
More than a half-million new businesses start up each year. In 2003, about 572,900 new enterprises made their debut. Trouble is, roughly the same number of small businesses fail every year. According to the Small Business Administration, approximately 554,000 firms failed in 2003. Millions more struggle with derogatory legal processes such as bankruptcies or liens at any given moment. And, in contrast to the relative transparency of publicly owned companies, reliable information about small businesses is hard to come by. That’s a significant issue when trying to ascertain whether a firm is likely to pay its bills on time or if warning signs portend significant trouble ahead.