IMAGINE SPENDING ALL YOUR time preparing for an extravagant dinner party. The champagne is bubbling, the cutlery is shining, and the platters of hors d'oeuvres fill the candlelit room with a pleasant fragrance. But no one shows. And you're left with a hefty tab and an unsuccessful event.
For years, companies have been throwing parties that nobody attends. And their solution often is to fire the agency that designed and sent out the invitations.
But the invitees aren't the problem. It's the list.
Creative gets most of the attention in direct marketing. But great campaigns begin with data, not with the big idea. It pays to remember three simple concepts:
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Business and the data supporting it drive every creative decision.
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The sales cycle is as important and complex as the product cycle, and marketing needs to support each equally.
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The sales cycle begins with clean data, which results in stronger leads and faster, higher-dollar deals.
But back to the dinner party and the invitation list.
The sales cycle starts by identifying prospects, learning as much as possible about them, pinpointing their needs and pains and tailoring a pitch to fit the situation. In today's competitive market, renting a list is the wrong way to initiate such an important process.
This is because there are two problems with rented lists. The first is that everyone uses them, so your invitation will be one of many. The second is that rented lists can be as much as 30% dirty. Fields might be missing, contacts could be out of date, or the lists themselves don't target specific roles in the sales process. So your dinner party is potentially 30% empty. And worse, those who do RSVP and get in the sales cycle are often the wrong people, frustrating your sales reps and heightening the already difficult relationship between sales and marketing.
The solution is to create a foundation of clean, proprietary data that will distinguish your campaigns from the competition and create an ongoing, productive dialogue with your market. This means shifting from unreliable, overused rental lists to ones built and maintained in house.
Results show time and again that by using a strong validated list built from the ground up, your campaign will get much higher response rates — almost five to 15 times greater than average. More importantly, companies that have very strong lists have a much higher conversion ratio for inbound leads to qualified leads. This translates into greater sales efficiency, lower sales costs and increased sales capacity.
“For my inside sales team, I would much rather have 100 good leads than 1,000 random leads,” says Jim Mongiello, director of corporate sales at online security firm Proofpoint. “By focusing on marketing to the best prospects, my team can significantly reduce the amount of wasted calls made by sales reps and help maximize our deal-making capacity. I would estimate that inside sales teams can typically close 20% to 40% more deals per year by having their data cleaned before it gets to their call lists.”
Clean data is the key to focused campaigns and will prevent you from spending money on dead-end leads. Unfortunately, only 61% of companies believe their data is accurate enough for decision-making, and 27% agree that the information they need isn't there, according to the Direct Marketing Association's 2005 annual report.
“We can't do business without clean data,” notes Greg Lanier, director of marketing at Infoblox, a network identity appliance manufacturer. “We've invested a lot of money in making sure we put the right amount of money in the right places. Last year we worked on our event data and saw a huge ROI compared with the past. If you don't have clean data, you can't get specific about your market. This means you won't be able to slice through information about geography, about the title of prospects and other demographics.”
Business analytics company Actuate recently spent a significant amount of time and money to build both new lists of prospects from scratch and clean its existing databases. “These efforts netted a 13% response to a recent campaign,” says Sarah O'Rourke, the firm's senior manager for marketing programs. “And more importantly, they resulted in more than 40 qualified leads and a very happy sales team.”
Once you've got a clean database, concentrate on maintaining its quality and augmenting it with new leads. With 15% to 20% of the average contact database becoming outdated every year, firms should scour their data. Are the leads still current? Are the right titles listed? Above all, examine lead efficiency; this ultimately will determine the extent and frequency of any data cleansing.
During campaign planning, it's also important to prevent “garbage” from filtering into the data, because this will defeat the energy put into building your list. Keeping the file clean — whether quarterly, monthly or weekly — should help reduce duplicates and keep campaigns flowing with confidence. This will give your marketing team more resources to focus on the leads that really matter during their next sales effort.
DENNIS TOTAH (dtotah@catapultprofiling.com) is the president and founder of Catapult Target Profiling and vice president of Catapult Direct Marketing, both in Campbell, CA.
Further RESPONSE RATE Reading:
- · Personalization to Boost Response Rates
- · Five Deadly Sales Letter Mistakes
- · Direct Response Media Opportunities
