For any company, its marketing database is the lifeblood of the business. It is the wherewithal for reaching not only existing clients but also prospects, whether to inform them of a new service or product, spread news of a special offer or to gather feedback and opinion. It is, therefore, crucial that it is properly managed: a database should be clean, accurate, timely and laid out in a consistent fashion.
John Wallinger, database director of Craik Jones sums it up, It is your own data and if it is handled internally, it is within your control and systems. You know your data-feeds better than anyone externally.
There are alternatives to maintaining a database inhouse, but these may be hazardous. Companies may either rely on third-party data, with the inherent risk that it is not as well maintained or accurate as inhouse data should be; or to outsource the upkeep of the entire data file, thus taking it out of your direct control, and exposed to myriad dangers.
The following is a guide to constructing and maintaining a top quality database.
Step 1: Define your requirements
The first point is to decide what you want your database to do. Nigel Bennett, sales director at Market Location, says, Does it exist purely to give management information, is it for mailshots and telephone campaigns, or to be used by a sales team? Understanding what you want from your database allows you to keep it targeted and simple: the more complicated it is, the more there is to go wrong.
Step 2: Accessing data you already have
Accessing existing company data is the obvious starting point, but this can be fraught with difficulties. The two main areas from which to glean material are sales and finance, but the information stored by these departments is likely to be kept in different formats, reflecting the requirements of those divisions.
In addition, sales departments are notorious for not maintaining their data properly. The main difficulties to overcome in doing this will be technological and political. Wallinger of Craik Jones, says, Internally, companies fight over who owns the customer, but data is an asset to the organisation, not to departments. Collecting aggregate data, which can be done technically, is a matter of auditing the information. There are enough tools today that allow enterprise-wide access to data. The legal issues are a matter of whether people have opted-in or out.
Step 3: Tidying up data gathered internally
Having collected data inhouse, it needs formatting so that the different layouts are ironed out into one consistent view. Julie Knight, MD at Marketscan, says, Decision makers can be categorised by industry sector, location, post code, region and size by employee, turnover or net worth, depending on requirement. It will need to be made more manageable through cleaning, de-duplicating, enhancing and profiling. There are external providers to do that.
She continues, When a company has formatted its database, it can give a data supplier their customer database to match against theirs. The client company will give a profile of which industry sectors are populated in the database (e.g. manufacturing or transport) and the size of business (SME or larger companies). If you have your own database, data audits are an excellent way to find out what your customer looks like. Do that work before you start investing in new data.
Step 4: Sourcing more data
If there is not enough data within the company to achieve your objectives, it will be necessary to buy or lease some. It is possible for companies to collect it themselves either through their sales team or via a call centre but that is labour-intensive, time-consuming and does not provide guaranteed quality.
As Wallinger says, It is difficult to get to the right decision maker with their qualifying information people are out and about and in meetings. There is always a barrier to contacting them.
Step 5: Choosing a source of third-party data
Bennett of Market Location says, Having chosen the size of database that you require, ask a number of simple questions of your third-party data supplier to ensure you get the quality you want: where do they get data from? How often it is updated? Get them to show you their system; if the supplier claims to have 2.3 million records, ask them to prove it. Membership of industry bodies [such as the DMA] is another yardstick.
Wallinger of Craik Jones adds, Specialised suppliers do a lot to pre-qualify data. The issue is the cost of enriching, checking and collecting the information, usually done on a rolling cycle. Ask yourself: what haven’t we got? What do we want to achieve? For example, if you are targeting a telecoms business with a 3G card for laptops, you need to know how many laptops your customers or prospects have, whether there is a mobile sales force, etc. Firmagraphics standard business demographics show industry types, number of employees, turnover and how long a company has been in business. It depends on the type of contacts you want in your database.
Step 6: Storing it
Once data has been acquired, it must be stored. Wallinger says, Excel is the easiest format but a medium-sized company may need to bring in a database package. There are two options. Oracle is an electronic filing cabinet, a physical repository of data and has a database management system that is accessible throughout an organisation. Alternatively, a company can go to a vendor and buy an off-the-shelf package.
Bennett of Market Location states, The next step up is CRM. The majority of these solutions require someone at programmer level to get the best out of them. But companies can purchase and implement systems without that level of expertise. You can spend between £30,000 and £3 million on storage kit, but you can gain successful implementation for around £88,000.
Step 7: Ensuring quality data
Richard Payne-Gill, head of new business at D&B, says, To make your data usable, you need to have the addresses cleansed and have information added to make it more intelligent. An agency will take a sample and match your data to their database to determine its accuracy, for example name enhancement, address, contact information; is it a live concern or has it gone out of business? Your supplier should offer a guaranteed level of goneaways and measurable activity; if you dial 100 numbers, will you get through to 95? What coverage do they offer: a wide set of businesses or a narrow dataset?
Step 8: Inhouse maintenance
Data decays at an alarming rate; it is more like a sandcastle than a house, so it is vital to keep records current. This is a bigger challenge than setting up the database and needs to be undertaken every three months.
Knight of Marketscan comments, There is software that allows companies to clean their own data and suppression files such as telephone and fax preference files ensure organisations do not target potential clients against their will. The National Change of Address File keeps records up to date and external suppliers of data can also send refreshers.
Tim Borthwick, director of LBM, says, Control who will have access to the database and how. It is not difficult to pull data together and input to a computer database. It is important that organisations make clear who the users are and how they will get information from the base. You see more failures through those factors than through getting the data together. This will have an impact on the search and management software. IT planning is not a strength of small companies.
He continues, Excel is too easy to muck up, as people mess about with it. You have to have people who know how to open it, use the database, manipulate it and then you need a package to look after it, using software to make it easy for non-technical users. If it is too difficult to use, the data becomes out of date with disuse. Data doesn’t look after itself; it is complicated and tedious to get it right.
Bennett of Market Location adds, Crucial to ensuring data is well maintained is having a champion (or champions) of the database within the company. If it can be the MD, all the better. Salespeople are notorious for not updating data, so if it is to be updated inhouse, then the sales team needs an incentive directly linked to their commission scheme. If customer activity is not put into the database by the end of the month, they don’t get their commission.
Step 9: Outsourced maintenance
However, as an organisation grows, maintaining a database inhouse can become too big a task according to data suppliers. Borthwick of LBM says, An outsource agency pulls in skills you may not have, whereas large organisations may have a team to do it themselves and outsource bits of it.
Richard Payne-Gill at D&B, adds, It is far too expensive to do it internally the cost is particularly prohibitive for prospect data whereas an agency can supply updates regularly.
Step 10: Impact on the corporate wallet
Borthwick states that, Budget should not exceed RoI. A lot of the expense would be the cost of a person who looks after it, so it would be a minimum of £10,000 a year.
Although small companies often have restricted budgets, it is not worth compromising your database for the sake of a few pounds. Bennett says, If you want your database to do five things, setting it up will be more expensive than if you want it to do two. Realistically, £250,000 will get an all-singing, all-dancing solution, divided 35:65, 35 per cent on software, 65 per cent on data; although a basic tool costs between £30,000 and £40,000.
The corporate financial advice market is dominated by the ‘big four’ global players (PriceWaterhouse Coopers, Deloitte, KPMG and Ernst & Young) to the extent that smaller competitors such as Grant Thornton have found it difficult to generate awareness and, consequently, traction.
Grant Thornton wanted to increase brand awareness amongst larger companies, particularly in the City of London. It also wanted to challenge and engage with the market’s perception of Grant Thornton and its capabilities, and to demonstrate that it is a genuine alternative to the big four.
To achieve this, it commissioned its first-ever advertising campaign from Leicester-based agency Big Communications, as part of a strategy to establish itself as a ‘challenger’ brand, providing an alternative to the ‘establishment’ of the big four. A key objective was considered to be challenging the assumption in London that the big four are the only providers of specialist financial services before the selling of services could begin. As a result, activity would require an emotional response to communications.
Defying convention
Big Communications responded to the brief with a very simple strapline: ‘Think beyond convention… Think beyond the big four’. The first two ads in the campaign were designed to contrast the bland, scale-orientated values that Grant Thornton claims are common amongst the big four, with values that are more important to itself and its clients. This was achieved through the juxtaposition of four identical headlines (e.g. ‘big’) against a single smaller one (‘clever’).
The objective was to reach influencers within large city institutions, large corporates and major intermediaries, who can directly, or indirectly, affect how work is allocated. These individuals may not be working for the organisation directly, but may be ‘intermediaries’, such as lawyers or bankers providing a service.
Activity began in 2006, with a schedule for two four-week bursts over each of the following three years. Media-buying agency Pure Media was drafted in to develop a strategy to reach a broad range of the target audience. The following mix was selected.
- Posters: 48 sheets at 80 sites within commuter stations in affluent areas around London, plus 60 escalator panels at Bank Underground station.
- Press: Financial Times, The Times and The Lawyer.
- Outdoor digital: animated ads on Transvision screens, and overland stations.
- Web banners: ft.com
- DM: 22,000 shot campaign to support above-the-line.
- A massive internal communications campaign was also conducted, featuring posters, screensavers and competitions.
- A total of £1.2 million has been allocated to the campaign for the duration of its three-year lifespan, with media-spend fixed and a small sum set aside for ongoing tactical activity, to be used on a discretionary basis throughout the campaign.
- A PR campaign was also undertaken, in parallel with the first burst of activity.
Results
Pre and post-campaign research was conducted to track the effectiveness of the campaign. In the intermediary market (i.e. lawyers, bankers and venture capitalists) awareness of Grant Thornton jumped from 44 to 67 per cent, following the first four-week activity burst. Awareness in the mid-market sector rose from 20 per cent to 37 per cent during the same period.
The campaign also won ‘best brand awareness campaign’ at the B2B Marketing Awards 2006.
Chris White, director of communications for Grant Thornton UK, comments, We are delighted to have won this professional award. It is great recognition for a campaign that has blown the cobwebs off conventional advertising in the accountancy sector.
He continues, Despite being in the first phase of a three-year campaign, we have already seen a dramatic increase in brand awareness. As well as extremely positive feedback from clients, staff, contacts and targets, the results from three independent market research studies have shown awareness levels, which in some cases has doubled among our target audience.
In an opinion article by Diane Hargreaves, commercial administrator at CNS, published last year in this magazine (B2BM Oct 06, p5) agencies were lambasted for their failure to submit to the standard procurement procedures her company follows. Writing not only as ABBA chairman, but as someone directly involved in managing and running an agency, I would like to present the agency viewpoint.
Diane tells us the statistics speak for themselves. Apparently, 193 organisations were sent a request for information and only 33 per cent responded. So 62 sent in their response. Of these, apparently only 31 offered ‘the correct level of services’. These lucky 31 were then sent a request for a proposal. Apparently, eight (4.15 per cent) removed themselves from the process, and only eight sent in proposals. Of these eight, only four were good enough and four had the audacity to ask for a pitch fee.
Spirit of co-operation
There is plenty that is disconcerting about this process, and plenty in the piece that should make agencies sit up and take note. In trying to find an agency to work with on something as important as branding, it is noteworthy that the agency is described as a ‘supplier’. I suppose I should be realistic and understand that it is rare for agencies to hold an exalted ‘partner’ position with most companies, but what we do offer does demand a different kind of buying process from ordering photocopier toner.
If what you are after is advice, strategic input and recommendations for your brand, then you are in effect asking a third party to work with you on one of your company’s most important assets.
Quite clearly, you need to feel confident that the people you are going to work with have the capabilities, skills, understanding and dedication to be able to achieve what you require. The selection process is therefore important and requires a level of commitment from the company as well as the agency.
Try before you buy
Diane was outraged that four agencies asked for a pitch fee. She compared this to being charged for ‘junk mail’. (I trust her company never uses direct mail as a marketing tool; I am sure they wouldn’t want to be associated with the production of ‘junk mail’.) I am afraid this analogy illustrates the misperceptions that many in the procurement and purchasing world have of the way agencies operate and the way in which selection can be streamlined.
Some of us do use advertising and DM to generate leads or create dialogue with prospective clients. This is, of course, at the very beginning of the process. The pitch is at the end of the agency buying/selling process and is a different animal altogether. To continue her analogy, I would ask if she has ever been to Tesco, and asked them if she can take home a can of their own brand and Heinz baked beans, open them up and taste them, then only pay for the one she likes. What other industry would put up with this concept as part of selection? Do we choose lawyers on the basis of comparing the contract they have drawn up? Or our auditors on the basis of which audit we liked best?
Pitches are a way for companies to test whether an agency has the competence to deal with their issues. As I have mentioned before, they don’t always come up with the right solution and they don’t necessarily satisfy all the criteria a company needs to answer to find the right people.
We agencies detest them but will submit to them to win the clients we want to work with. They are hugely expensive, time-consuming and a big drain on agency resources. I wonder if Diane knows the cost to an agency of the average pitch: it runs into tens of thousands of pounds.
Many agencies therefore demand a pitch fee simply to test the company’s commitment to the process. All ABBA agencies can recall nightmare scenarios of winning a pitch only to find that the budget has evaporated, or being asked to participate just to make up the numbers, or losing a pitch only to find the company subsequently using suspiciously similar ideas, but ‘created’ inhouse.
Two-way, one-way
What I didn’t get any sense of in Diane’s piece was that the building of trust is a two-way process. The bare minimum we ask from an organisation interested in our services, is time. We need time with the company to understand the issues, and time with them to get under the skin of their promise positioning, audience and competition. Maybe this was to be the next part of the selection process.
However, it seemed to me that the process was dominated by formulaic procedures that worked on the basis that; if you start with a wide enough net, you will catch the best fish. A better way is to thoroughly define what you need, and meet with a smaller number of agencies to see if they can deliver it.
Nevertheless, there is one area in which I do agree with Diane. It is, and will become, even more important for agencies to properly understand procurement processes. We need to work with them, adhere to them and properly address them, because this is the future of working with large organisations.
There are plenty of opportunities to ‘gamble’ a marketing budget advertising, mailshots, events, executive influence programmes but few guides to measure the relative value. Demonstrating the success of marketing except by the end-result (sales generated) is very difficult. Marketshare or shipments are only snapshots and do not show momentum, buying intentions or expensive never-to-be-repeated purchasing mistakes. During a marketing campaign, measuring eyeball share helps, but does not show the level of influence or ‘mindshare’ gained.
The value of mindshare depends on roles and responsibilities in the decision making process.
Recent Quocirca research has reinforced the view that simply pursuing a sale at the technical level will often result in failure, as many critical decisions are not taken in the IT function. Opportunities that seemed only moments from closing will fail, even though the right approvals have been gained, because budgets are reprioritised.
A good marketing strategy should not rely on a costly scattergun mass-mailing approach to stimulating demand, nor on executive contact on the golf course, but should understand the different financial as well as technical influencers in the decision making process, and how to effectively reach each of them.
So while the sales support teams are working hard to win the technology arguments, how can marketing provide positive broader influence, and where should the bets be placed?
Favourites
Given the financial impact, go for the information routes favoured by the commercial decision makers. In any unfamiliar area where there are important choices to be made, individuals generally favour personal recommendations from those they trust.
Industry analysts are the outsiders that are most likely to be trusted by both finance and IT managers, although as a group they are even more highly favoured by the marketing director, who often pays for their researched opinions and reports. However, forward-thinking analysts make their report content available free-of-charge at the point of usage, funding their research with bespoke work. This opens up the influential content to a wider audience, including smaller businesses, which seldom pay for opinion. Business focus that sheds light on the commercial values of a solution is most likely to appeal to the finance department.
Many of the financial decision makers still attend industry events to keep up to date with technology developments, more so than their peers in IT. What a shame then, that so many vendors present products and features at exhibitions and conferences, when benefits and RoI would earn more influence with the decisive audience.
Each-way bets
Business consultants offer trusted advice with moderate appeal to both IT and finance departments, but are perhaps a costly source. Free information from the vendor websites whilst partisan is also deemed useful. Perhaps the ability to look, without being pestered to buy, works in IT as well as retail sales.
For printed media, the more analytical content of monthly IT titles is favoured by the finance director, as well as the IT department. This is not interest in new technologies or features, but real-world examples, case studies and best practice. These might also be useful places to advertise a commercial message, but steer clear of pictures of ‘big iron’, megabytes per millisecond and acronym overload.
Outsiders
Commercial influence diminishes as online information becomes too news-oriented. Financial managers are less likely to be looking for the latest hot topic; far from it in fact. They want sound reasons for making an investment decision, preferably backed with proof from those they really trust.
However, many online sources do find favour with the IT department. It might be harsh to characterise the IT director as surfing for information that the finance director will ask a colleague for, but IT professionals will search the Internet for freely accessible information. The jumping-off point favoured by the vast majority is Google, but one online source still looks like a rider-less horse: the blog.
Fans
Despite widespread hype and the surge of interest in the interactive promise of Web 2.0, blogs are not yet something for most vendors to place a significant bet on. A flutter perhaps for the most adventurous, cool and trendy types to stimulate ‘buzz’ among fans, but it’s unlikely to generate significant influence in the boardroom.
Direct mail also failed to impress the decision makers in Quocirca’s research. So many of us hate it, bin it immediately or ignore it, and yet it is still the blunt marketing instrument of choice for many marketing departments.
Will those bets pay off?
Outside the IT function, there is generally a more conservative attitude to investment in IT, especially in those with financial responsibility. The lure is not the innovation or fascination with the technology, but what it can do for the business, and at what cost. That’s total lifetime cost impact, not just the purchase price.
From a product marketing lifecycle perspective, it’s like marketing to the whole spectrum from early adopters to laggards at the same time. Different audiences with the same organisation have to be identified, segmented and communicated with correctly, for the marketing bets to pay off. It may still be a gamble, but at least an informed and well targeted strategy will shift the odds in your favour.
