We are excited about posting the first of our series of  ”How Good Data Turbo Charges Lead Generation” interviews where we’ll talk to prominent btob marketing and lead generation experts to get some of their experiences and their views on marketing data, databases and their role in sucessful lead generation programs. We are just as excited that we got to interview noted database and CRM expert Lori Feldman in our very first feature of this series and in the process we have some valuable insights and great takeaways for readers. Without any more introductions and delays, here’s the interview:

You’ve been an advocate for building and managing robust customer and marketing databases, do you think current in the economic times CMOs should call for more focus more towards their customer databases?

Lori: IMO, you can never focus on your customer database enough. It’s the mother ship of sales! Unfortunately too many organizations treat their database like an address book instead of a business asset that appreciates in value with proper care and feeding. 

There are 2 primary database marketing strategies: Retention (keeping the customers you have–critical) and acquisition (getting new ones-urgent). Companies tend to focus on one or the other, but seldom both at once. (Or worse, they treat customers and prospects the same, which is a big no-no.) 

Usually the focus is on acquisition–prospecting, even though it’s at least 7X easier to sell existing customers than to convert new ones. Marketing and Sales sometimes think, “Well, we have those customers already; let’s go get new ones.” They forget their customers are Grade A Prime beef to another company’s acquisition program. Right now with a contracted economy, customer share is stolen rather than created. So it’s imperative to show customers maximum appreciation and head off potential defections. 

That said, if a company has been spending its resources in one area, prospecting, for example, then a great strategy is to beef up sales with the other discipline (customer care).

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How important is data quality from a B2B marketing strategy perspective and what can marketers do better to really tap into the full potential of their databases?

Lori: Data quality has 2 components: Is the info correct? And is it complete? For example, I could have a perfectly targeted list of CMOs at their company addresses, but without phone numbers or email addresses. The info may be correct, but it’s not ready for prospecting, unless I’m using snail mail, which, I believe is an expensive way to begin a prospecting campaign.

I recommend that organizations have at least one Database Champion who’s responsible for caressing the data: completing what’s missing, following up on bounced emails and opt-outs, keeping track of decision makers who are replaced. This last one is very important. One of my clients just told me that in her industry at least 30% of her contacts aren’t sitting at their desks anymore. The economic downturn isn’t just having an effect on people and companies; it’s murdering contact databases. 

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What are the common challenges you have seen lead generation and b2b marketers have with building or managing high quality lead databases?

Lori: The first challenge is finding all the data. It’s amazing how many different places people keep important leads. Here are a few:

·PDA phones

·Outlook address books

·accounting software

·various spreadsheets

·piles of business cards falling off desks

·multiple contact databases at the same company

·different departments at the same company who have pieces and parts of the same contact info 

I recently worked with a new client to set up his sales database. He just bought a 50-year-old company. The customer “database” was a 10″-high ream of greenbar printout–and no electronic version available. Obviously, getting that report re-keyed was priority one. Everything else he had, including sales leads from a manufacturing directory they subscribed to, needed to be matched to that list before any intelligent territory planning or sales call strategy could be mapped out.

Another common challenge for BTB marketers is combining multi-channel data. For example, a lead may come in through the website with just a name and an email address. Then that same lead may call in to ask a question. If the person taking the call doesn’t try to get complete contact info at that point, there may be 2 incomplete contact records instead of 1 good one.

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What would you advise readers who are looking to build a lead list / database? Is it worth the additional cost in terms or time or money to focus on acquiring higher quality contacts and more qualified leads versus purchasing or renting pre-built lead lists or database subscriptions?

Lori: A big list is great–if you have a relationship with them already. You can just turn on a drip marketing program, and away you go. They’re your peeps and they love hearing from you and feeling like  you care. They’ll even help you update incorrect information about themselves if asked. They want to be found.

But in the case of a big prospect list of people who don’t know you yet, don’t let your reach exceed your grasp. It’s too expensive. Only acquire leads you have time to work. I’m a big believer in the hybrid approach: If you don’t have any list, purchase one. But then add sweat equity to finesse it to the quality and target you need, including getting permission to email and finding the right decision maker. It’s a time-consuming and a tedious job but it can be outsourced. But the human edit propels you further down in the sales funnel.

Another mistake I see in building lists is not understanding who the real prospect opportunities are. This comes from not truly understanding your customer base. If companies truly *get* their customers, they’d find more prospects like them and forget about everyone else. But they’re usually afraid of leaving someone out.  When building a sales leads database, I always recommend starting with a customer survey. Let your good customers tell you why they’re doing business with you. Then use that intel to find and talk to the right prospects.

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What are the biggest challenges you have seen with managing CRM and marketing databasesamong companies you have worked with? Are companies doing enough to update and maintain their data at a level where its being leveraged to its fullest?

Lori: The biggest challenge is getting consensus from all database stakeholders (those who are using and contributing to the database) on the Rules of Engagement. I always tell my clients their database will only be as good as their worst user. Whoever that is, because they refuse to capitalize names and streets so email marketing goes out looking like a teenager texted it; or they aren’t sure where to put certain info so they “freelance” their own field definitions; or they refuse to look up to see if a contact already exists in the database, so they routinely add duplicates…often with variation spellings…making them harder to find and fix…these are the people we want to strangle if we’re in charge of marketing results.

The next challenge I see is that organizations fall way short of segmenting their databases. The tendency is to create a bucket of prospects and a bucket of customers, the end. In reality, there are at least 20 ways each of those buckets could be further grouped so that messaging is more relevant and engaging. Organizations do a terrible job with this because they think “list” instead of “personas.” This oversight is the big money suck that could put another 10%-20% revenue to the top line.

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About Lori Feldman

Lori works with business leaders and sales professionals to squeeze every drop of profit from their #1 asset–their customer database. She is a popular national speaker on database marketing, drip marketing, email marketing and social CRM. Lori received the Direct Marketer of the Year Award from the St. Louis DMA and her e-newsletter has won the APEX Award for Newsletter Excellence 2 years in a row. You can find her on LinkedIn and Twitter (@LoriFeldman) or her website at www.TheDatabaseDiva.com.

Thats right, as much as 16% of the marketing budgets allocated by global B2B companies are reserved for database and direct marketing according to the CMO Council’s “Marketing Outlook 2009” report. The findings of this report was published in a story on BtoBOnline Magazine titled “CMO Council report: Many budgets up” by Kate Maddox. 

According to the story based on the report:

It found that 50% of marketers plan to cut their budgets this year while 29% plan marketing budget increases and 21% will keep their budgets flat.

This is fairly good news after heavy budget cutting over the last few months and a good sign. The other interesting find was the different programs that the marketing budget will be allocated towards which goes something like this:

• Database & Direct Marketing     16%
• Sales Collateral & Lietrature      15%
• Trade Shows & Conferences       12%
• Print Advertising                             8%
• Online Advertising                          8%
• Search Marketing                            8%
• Social Media & Viral Marketing       7%

The top spot went to database and direct mail marketing which is a clear indicator of how heavily companies rely on their databases to generate revenue. Although this year will see budgets slowly move over in areas like search marketing, online marketing and social media, currently companies are still dependent on their customer and marketing data to hit those targets. What would be interesting to learn is from the spend on database marketing how much of that budget would be allocated to:

• Acquiring new data and building the database
• Cleansing & updating existing data
• Technology to manage data and leads
• Nurturing & marketing automation
• Other

How would you allocate your budget across these 5 areas?

Do lists make up an important part of your lead generation strategy and are they an integral part of your lead pipeline? If the answer is no, then the rest of this post isn’t going to be all that useful but if it is yes, then read on! This is the question we have been asking a number of our customers and prospects while talking to them not just because it helps us know if what we do can be helpful for them but also helps reflect on how you build or source those lists if they are important to you. 

Though even in cases where inbound leads are the staple, every now and then as a marketer you come across a need for a specific set of decision makers or contacts within a target set of accounts that you feel has potential and you would like to try reach out to them. Thats when building custom lists help supplement your lead requirements. While some companies do lay a lot of emphasis on building high quality lists for their campaigns by leveraging their inside sales teams others don’t really regard list quality as an important factor since they can be qualified at a later stage. They look at building volume lists with as many contacts as possible and then going through the long process of qualifying them and identifying the good ones. If contact lists are an important part of your lead strategy then the focus has to be on quality and not quantity. You want to add the best possible list of contacts at well qualified target accounts to your CRM and work towards nurturing those to qualified opportunities rather than looking to fill it with random contacts. Using custom built role based lists is far more effective as a long term strategy to building a better internal company marketing database than purchasing ready title based lists though you may get a lot more in terms of volume for the latter at the same price band. 

Customers sometimes have a need for a custom list just as a small one time requirement to experiment with an email reachout or one off direct mail campaign but feel that you need to have a larger minimum requirement or solutions like those we have at ReadyContacts need a bigger committment which isn’t true. There isn’t really a requirement that is too small or too large when it comes to an on demand custom list building effort. Its something you can order as per your requirement and as and when you need it which is what differentiates it from having a long term committment with a lead generation services provider with a minimum committment. The need for marketing data is not completely consistant at different times of the month or year so why should the supply be?

When lists are an important part of your lead mix, give it the attention it should get and it will pay off! 

If the need to squeeze everything possible from tight marketing budgets wasn’t already enough, the current enconomic meltdown is just going to make marketers even more accountable for every dollar spent and squeeze even more results from every campaign. Direct mail campaigns wont be an exception and being more expensive in terms of designing the copy, printing the material and postage costs involved, the quality of the direct mailing list is where the focus will have to be. 

A mailing list scrub and data cleansing effort is on several best practices guide for improving results on direct mail marketing campaigns. Rightly so since the worst possible scenario for a well drafted and carefully thought out expensive direct mailer is not getting to its intended receipient. The number one cause? Wrong or incomplete contact address data. So why should you use a list scrub before launching your campaigns?

1. The cost per lead of direct mail marketing is amongst the highest and can average between 1$ to 10$ so every mail that is not delivered to its target adds up to a significant wastage.
2. Non Standardized addresses make it difficult to interpret correct locations and often result in delays. The small task to standardizing addresses and normalizing formats can go a long way in saving time and money
3. Missing zip codes, state codes or street names are common in a lot of databases and often overlooked while labels and envelopes are being printed. Small omissions. Big cost.
4. Addresses do change from time to time and data does go bad. Verification will help filter out redundant addresses from your database and update them.
5. The incremental cost of cleansing a list may add cost per lead but will in fact save a lot more by increasing accuracy and delivery. 

Just when you think that marketers have tried every trick in the book, you come across another innovative idea which gives you that push to think outside the box. This is just one of those cases of sheer genius that we just have to share with our readers. Dubbed the ‘most expensive direct mail campaign‘ back in 1999, Business Wire published an article on how Frankenfeld.com frustrated with the difficulty of getting the attention of their personal injury lawyer prospects had to come up with a campaign that could make their target audience stop in their tracks to hear them out.

• What did they come up with?
  • They decided that since lawyers charge per hour, Frankfeld would pay for their time they would take to read their direct mail letter.
• How did they do this?
  • Simple. They decided to go to the bank and withdraw a few thousand dollars in crisp $50 bills each month and enclose them with the letter which contained the main message offering their marketing services to personal injury lawyers.
• What was the effect on the lawyers?
  • Well, to quote the company president Don Frankfeld himself “”Lawyers charge by the hour. I compensate them for the time they take to read my letter. Instead of being an unwanted intruder I become a welcome guest.”
• What was the result of the campaign?
  • They had a response rate of almost 50%. In short, stunning!

I feel the punchline to this campaign was not really the $50 plus cost of each letter which makes it an expensive direct mail campaign but rather the effect it had in turning them from the annoying salesperson who is knocking on your door trying to sell you something to someone who has compensated you for your time and you now owe him the same attention you would give a customer. A customer who you might just end up buying from. It’s the effect a salesperson would want from taking a prospect out to dinner, only in this case the prospects are on a mailing lists and the expenses come out of the marketing budget. In any case, with the results Frankfeld got, it seems like money well spent. Any thoughts?

Decision makers and buyers are a busy bunch. Everyone of your peers is trying to sell to them and how much ever they may have liked you, they WILL forget about you over time unless you do something about it. This problem is a huge one for trade publications who rely on their subscribers to not ignore the renewal notices and pay on time. However, very often, subscribers are too busy to pay attention to this and even thought they have the intention to renew, they just don’t get to it. This is an ideal scenario to innovate on how to get subscribers to renew. MarketingSherpa has a very insightful case study about how the VP of Membership at Society of Marketing Professional Services solves this challenge and created a winning formula. Here’s an excerpt, and here’s the link to the full article: 

Two and a half years ago, Tina Myers, VP, Membership & Chapter Development, Society for Marketing Professional Services, grew weary of members who ignored invoices and let their memberships expire. The SMPS was losing between 100 and 120 members a month. 

The organization needed a more sophisticated messaging approach, Myers says. They sorted through and tested new ideas before implementing an email-anchored strategy to entice marketing executives, directors and staff to renew and rejoin after they quit. 

Tinkering and tweaking led to a campaign that combined an email and postcard with occasional backup from phone reps. The multi-touch approach has paid off in lifting their retention rate from 71% to 82% – a 15.4% increase. 

Recent email data suggests that they’re zeroing in even more on their targets. Their June email saw a 62% conversion rate, a 34% open rate and a 13% rate for clickthroughs. 

“These percentages are beginning to become more typical,” Myers explains. “Our results over the last year have been getting better and better.”

This example is actually applicable to generic B2B lead nurturing and you can take a lot from this example and come up with your own recipe to keep relationships with your prospects fresh and active, and most importantly figure our ways to make it easy for your prospects to buy from you. It is important to understand that you are not the only thing on their minds and if you make it easier for your prospects to reach you, place an order and pay you, then you have it all good to go. Easier said than done, I know, but very few companies have truly explored how they can do this. Its time to do it now. 

Even though I’ve read that surveys conducted this year have shown more than 70% of marketers will shift a large part of their spend to online marketing other surveys have shown that there is no drop in the use of direct mail marketing as a b2b lead generation tactic. Direct mail still has its advantages and can still deliver the desired response rates to b2b marketers. When it succeeds its normally attributed to the content, the layout, the message or a crafty response mechanism. When it fails the fingers tend to point towards the same areas. There is however one other factor which can directly influence the success or failure of a direct mail marketing campaign. The direct marketing list.

Even the most ingenious copy or content for a direct marketing list can yield no results if its directed towards a poor list of recipients. Role based contact lists offer a better foundation for direct mail campaigns. For starters, you know your mailer is directed towards someone within the right role or capacity to act on it. Contact details like names and job titles can be verified again ensuring that you address the prospect right. Most importantly locations and postal addresses can be confirmed so that your mail gets to the right place and the right person. We have seen role based contact lists churn out much better results on campaigns like this and it makes a lot of sense especially if your printed material is expensive and you don’t want it to end up at the wrong location or sitting among unclaimed mail.

If you already have an internal list or purchased list of contacts and you’re still unsure about the quality of the list run it through a list verification process especially to confirm location and address of your prospect which is one of the most critical factors to more opens and reads. In the end you need to know that you have done everything within your capacity to make sure the mail reaches the right person. The rest may not be within direct control but rest assured, you’ve done your bit!