Database Marketing

Help in building and using a marketing database

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Basics of Database Marketing

Using Database Marketing in small businessesDatabase marketing is key to any B2B organisation and starting to build a marketing database is one of the first things that any new company should do.

Ideally, the database would contain every single person for whom your product or service would be appropriate. If your target market is the finance directors of the NASDAQ100 and FTSE100 companies, then this is perfectly possible. There will be exactly 200 of them! Similarly, there is a finite number of high school principals so it should be possible to have most of them in a database. If your target market is every sales manager, sales director, business owner, marketing manager and director, CEO and managing director in the English speaking world, as ours is,this will be a bit more difficult. Therefore, your best bet is to build as big a database as you can, capturing the data of as many of these as possible.

Once you have a decent number of people in the database you can start communicating your message to them, with a view to initially creating brand awareness, and then generating prospects for your sales team.

Building the Database

As well as populating your database with people who might purchase from you, you’ll want to add press contacts, bloggers, analysts and other influencers who will help you communicate your message.

Most importantly you will need to seek the contact’s permission to email them and store their personal data. There are lots of ways to capture contact information though in all cases use caution to ensure your product or service is relevant. If you don’t have an existing relationship, when you first make contact, introduce your product and why it might be of interest. And don’t forget to give the contact the opportunity to unsubscribe.

  • Existing Contacts

    You can load your, and your colleagues’, business contacts from personal address books, and maybe personal contacts as well if your product would be suitable for them. And don’t forget to include all your customers, old and current, from your accounting system. Good practice would be to telephone any old customers to check they are happy to receive your messages.

  • Business Cards

    Many people hoard away every business card they are given. Go through all your drawers and make a pile. You can get business card readers to automate data capture if you have a lot, but again, check for relevance and seek permission if they are not recent.

  • Web Site

    Once you have a web site you’ll want to capture visitors’ details, so offer them something that visitors will be prepared to give their email address for: a white paper, a newsletter, a free trial (see Converting Visitors to Contacts). And if you can link your web site to your marketing database and automatically capture their data, all the better.

  • Building your contact database

  • Research

    If you have a defined customer segment, such as the finance directors or high school principals, as mentioned above, you can build a list via the web using search tools such as Google and LinkedIn.

  • List Purchase

    At the risk of being controversial, we wouldn’t recommend buying mailing lists, especially if you intend to use them for emailing campaigns. The quality can be terrible and if you email them you’ll be flagged as a spammer almost instantly which will affect not only your brand reputation but your ability to email genuine prospects.

    If you must buy a list, clean it in house first over the telephone and then use it only for telesales and direct mail.

Communicating from the Database

Using Database Marketing in small businessesOnce you have your marketing database, you can start to send messages to the people on it. Email marketing is cheapest, then Direct Mail, then Telemarketing. What works for you will depend on the cost of your programmes, the conversion rate and your contract value. A cost per lead of $150 is great if you convert 25% of your leads and your average contract value is $10k, but not if your contract value is $500.

  • Email Marketing

    When it comes to getting your message regularly to people who have opted-in, nothing beats good old email. Sending Email Marketing is virtually free, you can send different emails to different groups of people if you have segmented your database, or even different ones to each person if you use advanced emailing software.

    We’ll not go into how to write the perfect email here, but you must keep your database up-to-date. Remove bounced emails and unsubscribers or you will find yourself flagged as a spammer and all your emails will bounce or end up in spam filters.

  • Direct Mail

    Sending a letter by post could cost you between $1 and $10 depending on size, weight and content, although if you send thousands through a specialist mailing house the price can come down. Very much the same considerations apply to creating a good mailshot as to a good email campaign when it comes to headlines, content and call to action. Like many marketing activities, don’t expect one mailshot to pay its way, you’ll need a campaign covering many months.

  • Telemarketing

    A telesales call will cost between $7 and $50, depending upon the hourly rate of the telemarketer and how many calls they have to make before finding a potential customer. Many companies have found that direct mail followed up by a telemarketer works for them.

    You should aim to communicate with the people on your database at least quarterly, and every month if you can. Communicating more frequently than once a month using email runs the risk of people unsubscribing through overkill.

Segmenting the Database

As you get more sophisticated and your database grows, you’ll want to segment the database so you can send different messages to different people.

Customers, Prospects & Suspects

You’ll certainly want to split out existing customers from the “prospects” and “suspects”, and maybe “suspects” from “prospects”. By “prospects” this means somebody that a sales person is actively engaged with. A a “suspect” is just a name on the mailing list, somebody that we suspect should be interested but we haven’t had any interaction with.

Then you might want to send communications more frequently to people that have recently expressed an interest in your offering, using a drip marketing campaign.

What Database System to Use?

Depending upon what you want to do, and how sophisticated you want to be, you can hold your database in many different forms.

Using Database Marketing in small businessesThe simplest was is to use a spreadsheet, with columns for first name, last name, email, address, source etc. If you are familiar with mail merging, you can then use the spreadsheet to drive the production of letters and emails.

A little more sophisticated would be a Contact Manager such as Microsoft Outlook or Mozilla Thunderbird. You can usually add custom fields for segmentation, and use the notes to record any interactions you have with the person.

If you are technically minded you could use a database manager such as Microsoft Access, LibreOffice Base or MySQL.

If the only thing that you are going to do with the contacts is send them emails, then a simple email marketing system like MailChimp or dotMailer works well.

If you want to combine your marketing processes with your sales process then an integrated CRM product that can handle both, including email marketing, would be the most sophisticated solution.

Database Marketing Conclusion

Like virtually all marketing activities, building a marketing database takes time, and you shouldn’t expect a huge pile of sales leads from the first communication that you send out. But over the years, as your database grows and people become familiar with your brand and products, it will generate a steady supply of leads.