Need New Customers? 4 Options On Where To Find Them
The key is to enrich your data sources for increased Insight
Every business has faced it – The Need for New Customers. Where do you find them?
The answer starts with data about prospects and that begins with you understanding and being very clear about exactly who you want to accomplish with the data that you acquire. You can either acquire lists of prospects or rent or license them.
Consider the following options:
1. Acquiring Prospect lists
Prospect lists are typically rented through specialized brokers. There are more than 34,000 business lists available for rent, at prices ranging from $50 per thousand (M) to more than $300/M. Business lists often focus more on the job title or function than the individual person, and they come in two general types: compiled files and response files.
2. Compiled files.
Compiled lists are those created from directories or other public and private sources for the purpose of resale or rental to marketers. The names on compiled files have some characteristic in common, whether it’s geographic or demographic, or related to industry, job function or product type. Compiled files can also be found in relatively small niche target categories. Look for trade associations, professional associations and trade publications in your target industry or segment.
3. Response files.
Response lists are created as a by-product of other businesses, like catalog sales, seminars, trade organization memberships, or magazine and newsletter subscriptions. Response files tend to be more current and accurate than compiled files, and they usually contain some useful information about product interest or buying authority.
One of the issues faced by B2B companies who deal with two-tier distribution is determining who might be responding to outbound marketing communications sent from the manufacturer. This is especially troubling to manufacturers if the responses are designed to flow to dealers or resellers who can respond quicker to customer requests.
Recently, some distributors are getting smarter about these special “responses.” Sensing that they play an important role between manufacturer and reseller, they have begun to take steps to value the data of these responses. Many distributors are managing their own marketing operations and analytical databases so that they can provide information to both the manufacturers they serve as well as their resellers.
Often this information has so much value that the smarter distributors are packaging it for resale to manufacturers and using it as “reasons to engage” with their resellers. Response data is highly priced in this situation.
4. Renting or Licensing Lists
B2B lists, like consumer, are available for either rental or license, depending on the preference of the list owner and on the marketer’s ability to negotiate.
To summarize the difference between these types of deals:
- Rental agreements typically require that the list owner approve the renter, to protect the list from competitors. The renter then agrees to use the list just once. The list owner enforces this rule by seeding the list with decoy names, and reporting any divergence from the one-time usage agreement. Any respondents to campaigns mailed to rented lists become the property of the marketer.
- License deals typically cover unlimited use of the names for one year, although additional years can be negotiated. Some people refer to this kind of deal as a “data purchase,” versus a rental, but because of the one-year time limit, technically the deal is a license. The data may be imported into the marketer’s database and used for communications or analysis.Pricing for licensing deals is usually around two times the base list rental price, so they generally make economic sense for multi-touch campaign strategies. However, not all list owners are willing to offer names for license.
Any kind of deal may be possible, but as a general rule, business marketers find that response lists are more suitable for one-time rental agreements, and compiled files may work for data rental or license, depending on the quality and relevance of the data.
Here are examples of situations where the decision must be made about rental or license, consider these hypothetical scenarios suggested by Data Axle.
- A controlled-circulation trade magazine serving the business insurance industry is seeking new subscribers. They are not looking for buying behavior, or evidence of past purchase. They simply want every possible middle manager in the business insurance world, and they want to penetrate the audience as deeply as possible, with multiple touches. So they cut a deal for a multi-usage license with owners of lists based on firmographic data, pulling all the names at particular companies with particular titles.
- A seminar promoter wants to find new attendees, and the best way to identify prospects from a large database of business people is via modeling. So they import a large number of names under license, building predictive models, and then mail the most promising prospects.
- An office products company knows that response lists are most productive, but needs to augment the available universe of names to optimize its catalog production volume. So they take compiled names on a rental basis to round out the mail quantity.
- A marketer targeting the machine tools industry wants to be sure it has every possible target site and all possible contacts at each site on its database for ongoing marketing purposes. So it brings in compiled data, matched first at the site level and then at the contact level, experiencing a 65-70% match rate against its house file, and populates the database on a three-year licensing basis, paying per element matched.
Each of these methods gives you additional insight into both your customers and those who you might want to be customers. Enriching your current data sources is a great way to better understand exactly who your best customer really is.
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