BtoB: What are the big trends you see right now in b-to-b direct marketing?
Mary Dale Walters: We now own entire businesses that manage their entire relationship, from marketing to acquisition to customer support and service, electronically with their customers. We are seeing in many of our countries a shift from print direct mail to online campaign development, much tighter integration of print with electronic. We're getting smarter-as are many people in the industry-about search engine optimization, and really being able to target who reaches us at the right moment in time of that relationship and bringing qualified, interested customers to us instead of going out and scattershot trying to find them.
Pamela Evans: Web is definitely something I agree is taking off more. What we find is in the IBM software business, in particular, we have a long sales cycle, and the Web gives us a great opportunity for our prospects and customers to go online where we establish a relationship that we can then continue to nurture electronically. I think we're going to see a lot more interactive marketing initiatives. We spent the last year or so across all of our divisions in making sure that we focus consistently on providing the same messaging [on the Web], which is always a challenge in a large company with multiple divisions. The challenge as marketers we all face is determining how the customer wants to interact with us, and really taking advantage of the Web and the power of the resource there for self-service. It gets down to having clear, consistent messaging that hits the customer pain point. And that's really, I think, the difference maker for the next year or two.
Brett Butler: Information delivery and reporting are among the trends I see, along with linking responses across communication vehicles. We are in a lot of pain because we didn't get our data organized before we started our CRM project, like everyone says that you should do. I say that in conjunction with the information delivery aspect, because what we're finding is that unless we can link the activity together on that account level, then we can't tell if we're being successful or not.
Joseph A. Burgio: In our industry, commercial print, the movement has definitely been not only to e-marketing but e-sales. Everybody across the whole sector of providers-from the small mom-and-pop to the large print facility like ourselves, to print distributors or brokers-they're all in the game now, or a good portion of hundreds of them are in the game of doing marketing and sales over the Internet. Where it's going over the next couple of years is really finding ways to differentiate yourself. Being a printer, we're hoping that direct mail never goes away, and I think some of the things that have happened with regulation of Internet marketing are testament that that will never go away. It's also a testament that you have to use a multitouch strategy. You can't just rely on one vehicle. You maybe use the Internet or e-marketing to bring in prospects or leads, and then as you narrow those down, then you launch your multitouch strategy. Maybe you use direct mail so it's more targeted and you get better returns on that investment.
BtoB: In terms of your b-to-b direct marketing strategy, have there been any big changes in the last six to 12 months?
Butler: Since the field sales cost per contact is so high, I need to have done everything I can to soften up the ground ahead of that field sales contact. It's important to ask the customer, "What media vehicle do you prefer for different communication events"-a price change, a new product announcement, those kinds of things. Much of the time they don't want to hear it from a face-to-face sales call.
Walters: What I see outside the U.S. is a willingness and a little bit more budget going towards direct marketing in countries where we have a lot of brand awareness to build and a lot of new customers to reach-mostly France, Germany, some of the Asian countries.
BtoB: And in the U.S. it's business as usual?
Walters: The U.S. seems to be a little ahead of the rest of the world, at least in our environment as far as how they're using direct mail, as are the U.K. and Canada.
BtoB: So direct mail is a big part of the strategy?
Walters: Direct mail, direct marketing. We have a large field selling force. Our customer could spend $6 a year with us or over $1 million a year. It's pretty dramatic. How you're reaching that customer, how you're managing new customer acquisition versus maintaining a relationship with a current customer, and how you use direct means of communications and marketing to those people is very complex in our environment.
Evans: The challenge becomes that integration point that Brett raised a moment ago, in making sure that we are always offering to a customer information that's relevant to wherever they are in a purchase cycle. That's the beauty of direct marketing. It really gives us that opportunity to help guide them-through awareness, interest, all the consideration-to an action, in being able to retain and keep them engaged along that process. It is a real challenge to keep it relevant to their particular needs. In our company, we're very challenged with the influencer and how can we reach that influencer, because many of those purchase decisions are made by committees. It's not a simple direct transaction; it's a fairly complex one.
We've had probably the biggest challenge this year with e-mail. It has not gotten through. Regardless of what kind of opt-in we have, because we've got fairly good opt-ins, we have customers we know who value getting information, but their company domain blocks [the e-mail]. We've had to go to other strategies to get around that.
BtoB: What is your biggest challenge right now? Sounds like e-mail is a big one.
Burgio: One thing that's very relevant as far as direct marketing goes is event-based [marketing]. Trade shows are still very much a less electronic-based marketing and more direct mail marketing. We're going to several [trade] shows toward the end of this year, and the way most of those organizations work is, if you want to touch those people before they come to the show, you have to submit your direct marketing piece. Then they send it out, or give you the list, and only after they approve your piece can you send it out to that list. So, we still see direct mail as a very important piece, especially when it comes to event-based, because there is no option. People don't want to get hundreds of e-mails as they're getting ready to go to a show from people that might be there that might want them to stop by their booth. It's more of their option if they get a postcard in the mail. They can either look at it and say, "That sounds interesting, I'll stop by their booth," or they just put it in the circular file.
Butler: Because e-mail is so inexpensive, if you're sending me an e-mail but we don't really have a relationship yet, it almost communicates to me, "I really don't value you that much, so I'm not willing to spend very much on you." You feel like just one more recipient of online pharmacy ads.
It is a complex, committee-based sales cycle around solutions. We're making promises around critical business issues. I'm not going to just make that decision because you sent me a catalog in the mail. I need to develop that relationship. For Lexmark, the event marketing side is important. It's the entire experience of contact media that's supporting the whole decision-making process. The challenge is trying to get it all aligned with the other marketing channels and also with your salespeople, treating them as the professionals that they are, telling them in advance what you're going to do and giving them a chance to opt their customers in or out. It is amazing to me how much work upfront that is. It's so much work I think a lot of times many of us avoid it.
Burgio: You have to give the sales force some sense of how well they're going to be able to develop that relationship going in, based on the vehicle you use to market to these potential customers. Because if they think they're being thrown to the wolves, where you haven't really established any true relationship based on the vehicle you chose for that campaign, they're going to be less likely to follow up. It's truly something where you have to help set the success rate for them, or else they're not going to be willing to do it down the road.
BtoB: Where are the biggest opportunities right now in your marketing strategies?
Walters: For us, it's opportunities and challenges both. In our biggest business unit, we are trying to move from selling a group of products to more of a solutions-based selling process. It has enormous advantages of going into a customer's office, and starting with a book and ending up selling them-down the line-a couple of thousand dollars a month in research services and a time and billing software package, and e-discovery services at the other end of our product spectrum. At the same time, it creates quite a few tactical challenges for us from a direct standpoint.
We bought a number of great, strong, small companies in the last couple of years. One of our biggest challenges is opt-in, opt-out, because they have been allowed to opt in for information from some of the companies, and they've opted out of getting information from another company that we own. Now we move into a solution-selling environment where we want to sell an integrated package of services and products to them, and we've created this situation where "No way; we can't send this person this e-mail, this campaign, because they've opted out of one of the three products that are being offered as part of that solutions package."
Evans: [We're] focusing on newsletters that are highly targeted, that can be delivered electronically. We find that a lot of our customers, and prospects that we haven't been able to reach through e-mail because of the filtering, we can reach very effectively through the content in newsletters-e-newsletters in particular.
Burgio: Up until a year ago, we didn't even have a marketing function in our company. For us, the opportunities are endless. It's going to be our challenge and opportunity to stay fresh on the site.
BtoB: Are there any new targeting methods or easier ways to target that you're coming across?
Butler: A lot of it is back to basics. Let's look in the database and see who's bought these three things that normally go together, and then let's look for a bunch of people that only bought two of the three [and market the third to them]. It's the old adage again that it's easier to get somebody to buy from you who already has. When it comes to prospecting, it's again back to basics: How can I identify companies, and people within companies, who seem to share a similar profile to the ones who have already bought it.
Burgio: One of the things that have become clear to us has been that the multitouch strategy of using direct mail and e-marketing gives you some additional opportunities to do targeting. For instance, if you're using banner ads on a segment or even a vertical-specific Web channel, that gives me further information to say, "You know, within small business, I know that Realtors are really responding well to the [banners]." Now, we know that we want to target even more specifically to them, and maybe create some things either on our Web site or create a direct mail piece that speaks specifically to Realtors.
Evans: We find that industry is a very important targeting component, along with other things like job function and perhaps the behavior, as Brett mentioned. But what was very interesting over the last year, we launched a new software Web site for IBM. We found that a lot of our customers and prospects started on an industry page where they could relate to a specific pain point. They were asking us for information about a very specific product. We've got all of our products there, but rather than going to the product first, they went to what they related to. We, as marketers, have got to keep reminding ourselves to put ourselves in the customer's shoes.
Butler: You can do the industry segmentation, you can do the title segmentation and then you get down to what I call "the tale of two VPs." You make two VPs the same offer on the same product, and one buys and one doesn't. What happened there? For us, we've been on a five-year journey moving away from selling boxes to selling solutions. We've had good success with that, and, yet, there are some people we're just not closing, and what we've had to come to grips with is the fact that there are a lot of people who don't buy this "solutions" thing. They're just not into it. How do you appeal to both of those market segments without ruining your pricing proposition? That level of targeting is what we're trying to figure out how to do now.
BtoB: What are you doing in terms of search marketing?
Walters: We do a lot of testing. It really depends on the business unit and where they think they'll get value. We've found, in most instances, a lot of value in search. It's not a static process. I still remember paying someone $95 and [that] bought up to 20 keywords for me. That was six or seven years ago. Now it's much more sophisticated.
Burgio: We're definitely using search engine marketing, and, for us, being a new business in an already crowded sector, it's tough. You've got the two components, paid and organic. In the paid, to try and justify the amount of dollars that it takes to jump right in and be on that first or second page is something that we have to have-not only revenue, to a certain extent, but some analytics or some metrics that tell us that if we go and spend that much money, what the ROI is going to be. On the organic side, it's really a time thing. You've got to get things like link referrals and other things that help boost you up on the organic side as well.
Evans: IBM uses search optimization. I see the real benefit and the real opportunity for the future to understand those keywords the customer is searching on, and to make sure you get your pages tagged in a way that's going to present your content to them so that you can really take advantage of that organic side of it. I think there is going to be a lot of change in the search marketing [industry] over the next five years, especially in business-to-business. We're just beginning to scratch the surface. We certainly are looking at it as part of the mix, but our advertising group does the buy, and we have a separate group that's focusing on the Web content.
It's pulling those two together and making sure that the sales team is telling us what the customer tells them every day, to go for those words that will resonate and then checking it to see if it is in fact being validated.