B-to-B Prospecting: Dig Deeper for Better Names
When it comes to a single name on a single list, a SoHo may look like any other company. Filling a business name field in a database merely requires filing a DBA (doing-business-as statement), if that. So, if you see your housefile growing, but your sales remain flat, SoHos could be part of the reason.
“Vertically orientated, small businesses need to focus on the people who buy multiples of times,” points out Chris Pickering, senior vice president of B-to-B list firm MeritDirect. “Conversions to second purchases are the key to lifetime value.”
The lack of a second purchase conversion isn’t necessarily because of the quality of your follow-up offer or bounceback piece in your fulfillment package, Pickering points out. In B-to-B, the key is finding customers who have the up-front need to make multiple purchases in the first place. The best designed bounceback in the world isn’t going to create a high-volume repeat customer out of somebody who only needs one ream of paper.
Pickering explains that marketing to SoHos isn’t necessarily a bad thing. Some B-to-B catalogers have thriving sales supported by entrepreneurs running businesses out of their homes. But other catalogers need to focus on larger players. “As a cataloger, it’s very important to know which one you are,” Pickering says. “If you get addicted to high response rates but low dollars per thousand, you could be hurting your business.”
In this scenario, B-to-B prospecting takes a different tack. Instead of asking, “How do you find new customers?” ask, “How do you find new customers predisposed to making a second purchase?”
“The ultimate goal is to build your own prospecting database and your own model,” says American List Counsel’s Lowenthal. “That’s what the big-box retailers are doing with great results.” Of course, smaller companies usually don’t have that capability, but they still have options.
A columnist for Retail Online Integration, George founded HAGUEdirect, a marketing agency. Previously he was a member of the Shawnee Mission, Kan.-based consulting and creative agency J. Schmid & Assoc. He has more than 10 years of experience in circulation, advertising, consulting and financial strategy in the catalog/retail industry. George's expertise includes circulation strategy, mailing execution, response analysis and financial planning. Before joining J. Schmid, George worked as catalog marketing director at Dynamic Resource Group, where he was responsible for marketing and merchandising for the Annie's Attic Needlecraft catalog, the Clotilde Sewing Notions catalog, the House of White Birches Quilter's catalog and three book clubs. George also worked on corporate acquisitions.