Today, one of the great challenges facing B-to-B marketers is finding ways to enlarge the universe of responsive prospects. This problem has been exacerbated by fewer new B-to-B buyer lists coming onto the market and by the shrinking size of many existing B-to-B buyer lists, the inevitable consequence of smaller prospect mailings.
When counseled to look more closely at testing compiled lists to find new universes, B-to-B marketers often meet this suggestion with skepticism: “Compiled lists don’t pull nearly as well as buyer and subscriber lists,” or, “Compiled lists aren’t as deliverable as buyer hotlines,” they reply. Frankly, both of these statements generally are true. However, they also reflect the thinking of a circulation planner who may have closed his or her mind to new ideas that can dramatically improve the results obtainable from compiled lists.
To help you put your idea incubator back in business, here are four ideas that can make B-to-B compiled lists and data work as you never thought they could.
1. Use more than one compiled list source. One of the dramatic epiphanies I have had while in the list business involved the completely counter-intuitive discovery that the two leading business universe compilers share only 70 percent of the same business listings. Suffice it to say that if you are using one compiler with success, you should be mailing at least one other compiler, too. That’s the equivalent of adding up to 30 percent more names to your prospect universe.
2. Get deeper into prospective buying sites with title slugging. This strategy is appropriate when your product offering could appeal to multiple targets within a company. For example, if your product line contains maintenance products for use in manufacturing environments that experience lubricant spills, you have quite a few good prospect titles to target within a site: safety manager, production manager, manufacturing director, purchasing manager, etc. If a site has fewer than 50 employees, you might want to mail only one or two titles; at sites with 100-plus employees, you should test all applicable titles. I have seen marketers segment companies into as many as five buckets, mailing anywhere from one title per smaller company up to six titles for larger firms. Note also that in companies with 50 or fewer employees, you always should test the title of president or owner—he or she often opens the mail.
3. Test new-business lists. One of the most popular forms of compiled lists are the new-business lists. These lists offer the mailer access to new and early stage companies that are in the market for a wide variety of goods and services. New-business lists are released to the market once a month. Furthermore, if one new business list works, chances are good that others will work well for you, too. Interestingly, if you take the new business lists from the top five compilers for any given month, only 20 percent to 30 percent of the names will appear on each list. That means there’s little overlap, so you should be mailing multiple new-business sources each month.
4. Hybrid compiled/response lists can reduce testing risks. If you have built your business by mailing to buyer, paid-subscriber and controlled- circulation lists, and want to develop a comfort level with compiled lists, you might want to test into the category with a compiled/response hybrid list. A hybrid list is one in which, through data appending, a response flag is added to a compiled record. This typically occurs as a byproduct of a monthly or quarterly cooperative database build. In my experience with using such hybrids, they typically will perform 10 percent to 20 percent better than a straight compiled SIC list selection.
While the hybrid SIC list will have a much smaller record count than the complete SIC universe, you can test into the compiled list category this way with a bit less risk. Then you can expand into the larger universe of the straight compiled SICs that performed best in the hybrid test.
5. Create your own compiled list from your housefiles. The title-slugging technique reminds me that every mailer can apply this tactic to its house file. For example, the maintenance products company used earlier to illustrate the benefits of mailing more titles could penetrate its current customer base more deeply by slugging appropriate titles into the records of existing customers. This is also a good reactivation technique when applied to customers who haven’t ordered in 18 to 24 months. Often, the individual name you have on your file is that of a person who has transferred or left the company altogether. Smartly directed title slugs will often find you a new champion within an inactive account.
6. Use data from compilers to improve the performance of your house files. D&B, InfoUSA and Experian have been providing business demographic (also known as firmographic) overlays on B-to-B house files for a number of years. In the past three years, within an environment of generally mediocre economic conditions, the popularity of customer list appends has grown. Still, many B-to-B mailers are flying blind as to who their customers are.
The benefits of having a thorough and accurate firmographic picture of your customer list are numerous. You will gain access to a research tool that will help you identify the types and sizes of your customer companies. This will help you target prospects that look like customers in your existing house file. This insight also will help you in your product development and merchandising. Plus, combined with transactional data, the overlay becomes even more powerful, for it will help you identify prospects that look like your best customers. Conversely, you can avoid mailing prospect categories with poor repeat buying characteristics and/or low average orders.
Ralph Drybrough is CEO of MeritDirect, a list management/brokerage firm that specializes in circulation and database marketing strategies for B-to-B companies. He can be reached at (914) 368-1001.