Sound Circulation Tactics for B-to-B Catalogers
By Stephen R. Lett
If yours is a business-to-business (b-to-b) or a business-to-institution (b-to-i) catalog, no doubt you have questions about effective prospecting techniques. Below are some tips on how to use your housefile as a prospecting file, such as mailing by name of individual vs. by functional title.
The Income Statement
One of the significant differences between a consumer and a b-to-b catalog company is the income statement. The EBIT (earnings before interest and taxes) of a typical b-to-b company ranges from 10 to 12 percent. Consumer catalogs tend to be less profitable at 3 to 6 percent. Direct selling expenses account for a large part of this difference. There can be as much as 10 or 12 percentage points between them.
Selling expense to sales ratios for a consumer catalog usually range from 25 to 30 percent — or more. This same ratio for a b-to-b catalog typically is about 18 percent of net sales. The key differences are noted in the chart "Direct Selling Expenses."
"Title Slug" Your Housefile
One way to get more out of your housefile is to use it as a prospecting file. Your housefile contains the names and addresses of companies that have bought from you. It's possible the person you have in your customer record is no longer with the company. So the catalogs you're mailing to a particular business may not get to the right person and may end up in the trash.
However, it's already been demonstrated that the company has a need for your products. So it simply may be a matter of getting to the right person. What can you do? "Title slug" your housefile: Delete the name of the individual in the contact field and insert an attention line (i.e., a functional title) in its place.