Marketing Direct. October 2005. Lists
If the days of the high-volume, 'carpet-bombing'
mailing are not quite over, then there are certainly lots of companies
looking for a better, more targeted way of communicating with
their customers and prospects. Typically, this involves more detailed
segmentation, using lifestyle data and demographics to get to
those people who are most likely to be interested in the goods
or services the company is selling. But what if you could take
this a stage further, and identify prospects who are not merely
potentially interested in what you have to offer, but who you
know for a fact are actively in the market for that particular
product or service? This is the idea, or at least one of the ideas,
being proposed by NDL International, the data company recently
resurrected by data veteran Tony Coad. Alongside a traditional
list rental model, and a service to enable client companies to
monetise their customer database, NDL is proposing a form of sales
lead list rental, where it would feed companies details of consumers
who are in the market for the product or service they are offering,
and who have given their explicit permission for their details
to be passed on.
The example Coad gives is of a classified advertising operation
on a local newspaper. When a member of the public phones in to
place an ad. to sell their car, rather than just taking the ad.,
the sales rep would ask the seller if they planned to buy another
car to replace the one they are selling. If so, could they pass
the person's contact details on to companies who might be able
to help them find the car they want?
This is just one example. Coad says that newspapers typically
have around 25 ways of gathering data from their readers, including
reader offers, holiday services, book sales and, increasingly,
online. NDL aims to help media owners and other brands tap into
this data in order to hit these hot leads with relevant offers.
"I believe the future of data will be in real-time sales
leads" says Coad. "What companies want in today's world
is to know who is about to enter a market for their products and
services, and how to contact them. This is particularly appropriate
for newspapers, because they are trusted brands who have a dialogue
with their readers every day."
So what do others in the list business make of NDL's plans?
Chris Grey, managing director of TRG Strata is in no doubt that
the idea has legs. He says:
"It sounds fantastic. Much will depend on how quickly they
can get the data back in the marketplace. But the idea of tying
it in to a regional newspaper that people have a close affinity
to and asking them about things relevant to them sounds awesome."
Grey's one concern is about the volumes involved.
"I'd want to know who do they have on board as partners"
he says. "Everyone is moving away from the volume-driven
marketplace, but it's a question of whether they can sustain the
business while they get the numbers up. How much volume can they
get and how much will advertisers be prepared to pay for it?"
This concern is shared too by Peter Thompson, sales director at
Experian Prospect Targeting, who says:
"It's an interesting development. The pros are very immediate
data with an immediate requirement, so you would hope it would
perform strongly. The negative part would be the volume, because
not everyone would want to get those offers."
For his part, Coad does not seem unduly hung up on the volumes.
"The great beauty of this is that it is not vast amounts
of data every day" he says. "If you take a typical regional
newspaper, you might have 260 people this week who place an ad
for a second-hand car, and of those, 160 said they were replacing
it and would be happy for someone to talk to them abut the sort
of car they would replace it with."
Moreover, as Coad points out, it's not all about classified advertising.
Once you bring the internet into play, those volumes could start
to look quite respectable. Stephen Pratley, eCRM marketing manager
at ipoints.co.uk, the online loyalty programme, says his company
feeds sales leads through to client companies based on its members
online activity, including the sites they have visited and the
products and services they have clicked through to. Additionally,
for clients looking for very specific sales leads which are hard
to source from elsewhere, ipoints can carry out an online survey,
where members are asked a direct question "Do you drink
herbal tea"? "Are you planning to take a foreign holiday
in the next three months?" - to qualify members as sales
leads.
"We craft the most appropriate questions to answer our clients'
objectives" says Pratley. "Whilst this is reported information,
the fact that we collect it in real time, and can send out a campaign
to these people the same day, makes this form of lead generation
extremely powerful."
Perhaps the company best placed to offer a view on NDL's plans
is Data Locator, which for the past six years has been questioning
around 40,000 consumers a month, by phone and, increasingly, over
the web. Companies sponsoring questions on the surveys can ask
very specific, targeted questions in order to identify sales leads,
and as Data Locator group data director Richard Webster explains,
the data that comes back can sell at a substantial premium to
regular lifestyle data.
"It's a very different proposition to normal lifestyle data"
says Webster. "Lifestyle data is effectively like any other
cold list, it may be 6 or 12 months old and it tends to be generic.
You can build up a good picture of the consumer, but you do not
know what they want at that point in time. The timing is key,
and this means there is a premium on the data."
The size of this premium, says Webster, depends on the response
rates and on how hard it is to get hold of the data in question.
"If you take something like personal injury, it is very hard
to find people who have been injured in the last two years and
who have not made a claim against the responsible party, so companies
in that market will pay a substantial premium for these leads,
as much as 10 times a normal lifestyle prospect. It's like gold
dust to them."
And good news for NDL too, if it can make the idea work.
<CASE STUDY>
Hot leads for broadband
As the broadband market in the UK gathers pace, suppliers clamouring
to promote their products and services in this increasingly competitive
sector are marketing to the masses. However, the reasons behind
take-up of broadband are now far more varied than internet browsing
and email. New technologies such as online gaming, and low cost
international call services such as Skype, as well as increasing
numbers of home-workers mean that there are very different motivations
for using the same service, with many people not even using a
traditional home computer.
To target these different groups with relevant messages, ipoints.co.uk
used its 'ipoll' survey technology to ask ipoints members about
these activities, backing up their response with a wealth of online
behavioural data. A total of over 15,000 ipoints members responded
to the survey. This provides a unique databank of new, qualified
prospects. In such a fast moving market, this kind of real-time
recency is key to getting the message out at the right time, whereas
lifestyle data can be many months old before being released.
After conducting the survey, ipoints then produced an email campaign
for broadband prospects aimed specifically at those people who
had raised their hands to being in each group. The highly-targeted
campaigns used subject lines and creative tailored for each group.
The email campaign was extremely successful, generating a conversion
rates at 3-5 times the rate of price-led campaigns that had been
run previously.
Says Stephen Pratley, marketing manager at ipoints:
"Because of the many different reasons for people to take
up broadband these days, being able to identify their motivations
is a big benefit in what can otherwise be a very price-driven
market. Internet usage is dictated less and less by lifestyle
and demographics but by attitudes and personalities, and these
are attributes which are typically very difficult to find through
standard providers of prospect data. By asking a question via
ipoints, we were able to gather highly qualified prospects very
quickly. And, as we could then email those people within a few
days of asking the question, they were very hot leads indeed,
hence the excellent response."
<B2b BOX>
B2b Sales Leads
Could the sales lead model work in the b2b arena? Steve Cook,
managing director of Market Location, believes the difficulties
in getting through to the right person within a company could
make the idea impractical.
"It would be an expensive operation as it would be a 2-stage
phone call" says Cook. "The first call, to find out
who is responsible for what, and the second to ask them a variety
of questions. I would also be concerned that the same types of
organisations would be phoned again and again as everyone would
me most interested in the bigger companies, so they would get
fed up with it."
In Cook's view, companies would be better spending their time
on detailed customer analysis in order to build models to identify
where they would find new customers.
Nigel Bennett, business development director of Experian's b2b
division, advocates an integrated approach. He says:
"It's no good just looking at one variant, but there is a
scope for integrating sales lead data and matching it against
compiled data to give you a multivariant view. You need more variables
in the mix to make a decision as to whether someone is a useful
prospect or not."
And Zina Manda, sales director at the Reed offshoot Mardev, argues
that to a certain extent, it already happens.
"We collect incredibly detailed information about our readers
and exhibition attendees, including their purchasing responsibilities"
she says. "We also have a couple of websites, like our International
Book Information Service, where academics who log their details
and the subjects they teach with us get back in return information
from academic publishers publishing in their area. If they understand
that you will treat it well and be fair with them, in the b2b
environment, people will give you this information. The data is
too valuable for us to abuse it.
<QUOTES>
Adrian Cutliffe, senior marketing manager, Dun & Bradstreet:
"In the b2b arena, it's all about relevance.If it's relevant,
then there is an opportunity for it to get past the front desk"
he says. "The question then is: How do you make it relevant?
Are you cold calling? If you are, you will not get past the front
desk. But if you are calling as a result of an enquiry and have
a relevant question that extends the opportunity, then you have
a chance."
Dawn Orr, managing director of UK data,
Acxiom:
"There is, and always has been, a place for this. Lots of
companies in the data manufacture world have tried to develop
hot leads as much as we can with sponsored list development over
the phone and online. The upside is you get a relatively perfect
point in time. The downside is the quantity."