Micromarketing with IP addresses

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Chris Golec, CEO of Demandbase said he thinks online b-to-b marketing today is being delivered with a sledgehammer when a dart is all that's needed.

To help b-to-b marketers better target their potential customers, his company has developed a Web-based technology that tracks IP addresses and matches them to specific companies.

This allows marketers to recognize the company, department and even customer status of a website visitor in real time. Using this information, a marketer can then “provide a whole different Internet experience,” Golec said.

Personalized ads can be delivered based on the department, custom content can be displayed and, if the visitor is an existing customer, they can be automatically linked back into your CRM database to trigger a sales call or serve up timely and specific product offerings, “because if you're a company, you care much more about existing customers than lead generation,” he said.

Golec said his company has 1 billion IP addresses mapped, with data attached to each that goes far beyond the standard list data.

If this sounds like the b-to-c Web experience, it's because it is—except that instead of being based on cookies (which are routinely collected and used for online marketing in b-to-c marketing), it's based on IP addresses.

“It's just like serving up different ads,” Golec said, “except it's a different Web experience. It's microtargeting companies that have an expressed interest in your company."

Golec might have just hit on the next big thing in b-to-b marketing: micromarketing.

In his book “MicroMarketing” (McGraw-Hill , 2010), author Greg Verdino writes that the marketing of the future won't be large-scale at all—it will instead be based on highly personal relationships. According to Verdino: “The next big is actually very small—it's so small, it's micro.”

Effective micromarketing relies on one of two things: personal relationships or highly accurate data. Currently, b-to-b marketers typically rely on a few data points—such as business location, size and industry classification—when designing programs. Micromarketing, however, needs to go much deeper to be effective.

But this raises privacy and, maybe more important, efficiency concerns. After all, large businesses are not individuals—according to Golec, it would take about 30 million mapped and targeted cookies to effectively deliver online ads to the Fortune 1,000 companies. In the privacy realm, the Federal Trade Commission has recently opened a comment period on a proposed Do Not Track ban on behavioral ads, which has the potential to dramatically change the way people interact with the Web.

Golec, however, said that tracking IP addresses is different than collecting cookies, so any proposed FTC action would not affect his company, which last October inked a partnership with lead-generation giant Eloqua.

According to Steven Woods, chief technology officer at Eloqua, the Demandbase “real time” ID service results in “more accurate and deeper lead qualification.” According to Golec, companies that pursue IP-based microtargeting experience increased conversion rates of 50% to 300%.

“The data quality is much better,” he said. “You experience much higher engagement.”

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