INSTITUTIONS LIKE SCHOOLS, hospitals, government offices and libraries represent a $4.1 trillion annual market. They're mostly recession-proof and very often are predictable product buyers.
But they're not easy to reach, said Mary English, assistant director of strategic alliances at MCH.
Institutional buyers behave differently from businesses because they're governed by a different set of accounting principals, English noted last month during DMA06 in San Francisco.
For example, most companies want to save as much money as possible to improve their bottom-line performance. But institutions must spend their entire budgets within the fiscal year or risk losing that money the next year.
For this reason, it behooves catalogers targeting school districts to mail between April and June, when their fiscal year typically ends. “You're not going to reach a school principal in August,” she stressed.
Institutions also have concentrated buying power, so marketers can spend less money targeting purchase influencers and buyers than they do prospecting to companies. But, English warned, just sending catalogs to purchasing managers isn't likely to result in many sales because they often don't know who in their organizations needs what, and when they need it.
To get at colleges and universities, mailers are likely to do better targeting deans and department heads, English said. Similarly, marketers looking to penetrate elementary and secondary schools should mail to principals and, in some cases, individual teachers.
One of the more trying problems in targeting institutions is the inadequacy of the Standard Industrial Classification code, which she claimed is not sufficiently detailed to uncover the right prospects.
“Institutions are covered by only 50 SIC codes but account for one- third of the gross domestic product,” she said.
One way around this is to investigate the numerous specialized databases that exist in the institutional field.
