Publishers jump ship out of B2B

EMAP and Reed Elsevier are busy divesting themselves of previously hard won positions in the B2B sector. Someone is missing the trick here. Business information, and the ownership of the communication channels, is crucial to marketing success – so where do we go from here?

During my EMAP days, the view was that owning leading magazines in any sector gave the company the chance to build events and information businesses around them, to dominate a sector, and soak up the resulting revenue. Something has clearly gone badly wrong.

With recruitment revenue leaking online, and the publisher’s failures to build a definitive sector-based online presence in a changing B2B marketing environment, shareholder value is apparently better served by a sale.

Expect new owners to change things considerably.  

Much hot air has been expended on the future of the Internet over the years. The idea of building communities still hangs around like a bad smell, but few people have managed to build one. Indeed, as you are reading this, you are part of one of the few – Brand Republic.

Publishers like EMAP and Reed appear to be admitting that they failed to find a place on the bandwagon. 

The construction industry is an interesting case in point. Despite a dominant position in magazines and exhibitions, with a successful information business (including a fine DM database, if you think I am meandering off subject here) EMAP failed to find the online presence to draw it all together. They were not scared to invest...in the mid to late 90’s they bought anything that moved...but they were not prepared to build.

They were, in my humble opinion, stuck in the trap of defending traditional revenue streams, and therefore unwilling to invest in new ones. Few sectors are as open to a community forum as architecture and medicine, with so much to discuss and share. So how come EMAP could not build businesses that are too good to sell from such strong assets? 

These assets are crucial to our marketing success. Let’s hope that any new owners have a vision for the future, rather than one foot stuck in the past.

Gosh...people are ignoring email best practise guidelines?

The ESP Dotmailer report ‘Hitting the Mark’ points the finger at ‘sloppy’ habits, such as poor creative, inappropriate landing pages and a lack of targeting. Retailers got the rough edge of the Dotmailer tongue in particular, poor lambs. Obviously, the news that email marketing is sloppy and poorly targeted will come as a great shock to us all.

Not.

First of all, the data. Consumer email lists are acquired. Normally by offering something in return. The data behind the email address is sometimes good, sometimes not. Unsubscribe rates are high, so the data is an ever changing cess pool of untargetability.

Secondly, the delivery process has spiralled out of control. So many people are broadcasting now that there is little or no good advice being put in at the point of order. How many data suppliers ever do more than check their clients creative for stuff they don’t like?

Not many.

No one says that looks terrible. No one says that landing page is a pile of doggy doo. They are too focussed on turning the data.

And too many marketers turn to email because it is cheap. Once in this mindset, spending money on creative and the landing page seems like a sin. Especially for the small business, I am afraid.

There is even more of a DIY mentality in email marketing than there ever was in snail mail. Obviously, the retailers named and shamed in this report should be ashamed of themselves, but there but for the grace of God go most people who have ever clicked ‘send.’

So now the cowboys know what to expect!

For persistently sending unsolicited faxes, after being warned by the ICO, a company was fined £100 for each charge, with costs a total of £2526.25p. The ICO received 2000 complaints AFTER it first warned them. Well, that’s telling them, isn’t it?

Whilst delighted that someone abusing the system has been taken to task, I am a bit shocked about the fine.

£1,900 of it was costs for goodness sake. Not much of a deterrent, is it? I bet they were shaking in their boots about paying that one.

2000 complaints suggest extremely bad behaviour to me. If we get one complaint, we go to great lengths to find out what went wrong and stop it happening again. And to get those complaints after the first warning... 

So the answer is, my friends, there is no sheriff. This is officially the wild west.

Steal, rustle, shoot and besmirch, and the worst you can expect is the cost of two tables at an industry awards dinner. Including the table wine.

And we put a man in his seventies in prison for not paying his council tax!

Charity begins at home

According to The REad Group, charities are not using enough suppression to weed out gone-aways and deceased records. Not a huge surprise there. Donor acquisition is a pure ROI process. It is about hitting doormats, not names.

Waste is waste, but suppression costs, and when a charity mail shot hits the carpet, I doubt many people worry too much about whose name is on the envelope.

I am not sure not using suppression can be described as ‘abusing the trust of donors by wasting funds through the mismanagement of data.’ I am sure the charities in question would point to ROI as a defence of their campaigns.

No one should mail dead people, but the bereaved relatives are less likely to be offended by a charity mailing than they are by the offer of another credit card. So, at worst, it is a fairly cynical commercial decision based on the confetti principle.

Charities mass mail to hit their acquisition targets, and the numbers ought to speak for themselves. 

<:AtomicElement><:HighlightText>Suppression files are cheaper than mailing gone-aways of any description, there is no doubt about that. But it can seem expensive if the data is extremely cheap – which in the current market, it often is. And if the gone-away is replaced by another occupant, a charity has a fair chance of getting a response anyway. 

<:AtomicElement><:HighlightText>This world is rarely, if ever, black and white.

Deal or No Deal

Differentiation is the holy grail of marketing. Making yourself look different to the competition is hard, especially when you are not very different at all. B2B data is an overcrowded market, behaving like a commodity market, because the differences between suppliers are lost in the mists of overpromises and obfuscation, and any potential customers doubts are soothed on the altar of the best deal available.

Never mind the quality, feel the width.

Far too many customers have no idea what they are buying. Not the big data buyers, but most people are not big data buyers.

If you are doing one or two small campaigns a year, there is a fair chance that you do not think too hard about the data you are buying. The decision making process will involve a quick ring around, to ensure a competitive deal, which results in a few counts, and a constantly ringing telephone as the data wolves try to close you down.

That will involve comparing a lot of rotten apples with the occasional juicy orange. A good data supplier will try and find all the low hanging fruit. A bad one will package up his apples and try as hard as possible to make them appear full of vitamin C.

Down at the small end of the market, the deal is the thing. In terms of width, some of the deals you can get are truly unbelievable. So unbelievable, the data is almost bound to be total pants.

But this is an ROI game. If the results work for the client, the data worked for the client, and even rotten apples can still hit enough targets.

Marketers, even in small businesses – or perhaps especially in small businesses – ought to think more about quality. Buying cold data in relatively small chunks every now and again is not cost-effective. It leaves one exposed to rotten apples.

I would advise anyone in this situation to spend a bit of time locating the best data available, and then look to license it, and work on a strategic basis with their own prospect pools. That is when the differences between suppliers will become apparent – when you start to think about what you really need.

And then, the deal done in the end will be better for both parties.

Economics was never my best subject, but surely...?

Financial institutions are slashing DM budgets on the back of the credit squeeze. Egg are ditching customers on the grounds of them being too bad, or too good, depending on your view of things, and I am left a little confused, to be honest.

Acquiring new credit card customers via direct mail now must be sensible, surely?

There is obviously a risk in taking on new debt after having your fingers burnt up to the armpit in the subprime markets, but don’t these people need to trade out of the situation?

Slashing and burning the marketing budget makes little sense to me. No new customers means no new revenue. Be a bit more choosy about the risks you take, by all means, but don’t just stop.

No doubt someone is about to educate me on the finer nuances of this strategy. But the wider point is one that has always frustrated me.

Hitting the marketing budget does not only have a short-term effect, it has ramifications in the medium and long terms as well. Brand profile and momentum are lost.

One of our prospects, active in the subprime sector, is in the middle of a boom rather than experiencing a downturn. The competition have moved out, and they are doing better deals (for them) to minimise the risk.

That makes perfect sense to me. The reverse position does not.

UK Business websites pass the million mark

More or less. No one is exactly sure, because no one is actually counting out there in WWW land. But best guesses put the figure at around 1m. That is quite a lot, but there are still another million or so who haven’t bothered yet. Too small, too niche or whatever? It still suggests that there is a lot of growth to come. There is also a lot most of the sites already up could learn.

One of the key marketing tasks is now managing the online presence. In some ways, this task is made easier if you have something to sell ‘off the page’ but the majority of those 1m sites don’t do that.

They inform to a certain extent, they deliver corporate literature, they point people at a phone number...but not much else.

In fact, let’s be honest – most websites are as dull as ditchwater. Not so much the consumer facing ones, as they are most likely to be obsessed with traffic and shifting units, but the corporate ones...repetitive boredom injuries are rife.

Why? Are we not taking this stuff seriously yet? Or can’t we come up with any really good ideas to make the manufacture of widgets interesting?

Go on, I dare you, surf a few B2B random sites and see if you can find anything to inspire you. Read a few ‘about us’ pages and see if you are any the wiser.

So, we have the quantity...it is just the quality we are struggling with.

And when the survey results don’t add up, just spin it the other way!

B2B101 is much amused by surveys this month. Innocent fun, of course. Now Softscan have released figures on a downturn in spam in January. Following on from a December high, this is described as the ‘calm before the storm’. It probably is, why waste a good scare story when you can just predict more doom and gloom in the future?

Apparently Valentine’s Day will drive the next wave of Viagra messages to my mailbox. Or maybe the early Easter, the fast approaching equinox (I am not actually sure if one is fast approaching but it is a pretty safe bet, I reckon) or the continuing credit squeeze. One or the other will get the dastardly spammers going again.

Spam is clearly a dreadful scourge. Not dreadful enough for the governments hosting these persistent chaps from doing much about it, of course, but a scourge nevertheless.

And the survey fills a few column inches in the trade mags, I suppose. I wonder what they will say if the numbers go down again next month?

Happy Valentine's Day to one and all

Deals that really are too ‘good’ to be true

‘Psst guv...no need to worry about single use and all that crap...buy my list and use it forever. It’s brilliant. No complications, you just part with the readies and it’s yours...forever. Come on guv, you know it makes sense.’

I am sorry. I must apologise. I know my opening paragraph suggests a level of professionalism some data suppliers are yet to reach. Unfortunately, the core USP of the sales message is completely accurate.

I even read it on the website of a self-styled ‘Marketing Solutions Provider’. 

<:AtomicElement><:HighlightText>Buy this list, and use it forever.

Except, forever doesn’t last very long in the data world. It is utter madness. Only someone who has no confidence in their data, and frankly doesn’t care how it is used, would ever do such a deal. 

<:AtomicElement><:HighlightText>The reason professional data suppliers sell on a single use basis is that data decays. Multi-use works if the client is going to use it quickly, or maybe a license allowing them to draw down data when they need it for the rest. Because we know that within a year around 40% of the records will have changed, disappeared or moved.

So if you buy from someone who offers you a lifetime deal for a few more quid, you are more than likely paying even more for a load of old rubbish. They are saving money by not seeding their data, and clearly have no confidence in their cleansing processes or their investments in quality. 

<:AtomicElement><:HighlightText>If they put no value on the ownership and quality of their data, why the hell should you?

After the breast-beating is over, what replaces the BLA?

Amid much recrimination, the Business List Audit is no more. It was a good idea, no doubt about it, but the fact was that the DMA committee culture watered it down to the lowest common denominator. It was never about quality, it was about process, and that was why most people ignored it.

In the BR news article about this, Anthony Hyde of Xerox admitted he had never heard of it, which was another major problem. Being not a meaningful test of anything and under promoted, the BLA hardly had much of a chance.

The simple fact is that there are a lot of data suppliers and/or owners out there who do not want their list judged on quality. Even some of the big boys, because they have quality problems, too.

I also disagree that the BLA was ever about preventing data decay. You cannot prevent decay, you can just make your data the best you can. Data should be fit for purpose. Nothing will ever be 100% correct, but you have to have a reasonable system in place to make it as good as you can.

The process might differ from one supplier to another, because collection processes differ, but a scheme where each supplier published its cleansing processes would be far more effective than a badly publicised industry ‘kite mark’. 

Instead, everyone claims their data is absolutely fabulous, and clients have to make an almost impossible choice.

Joined up thinking

Another one of those surveys caught my eye the other day. Alterian’s headline result was that two thirds of companies use three different marketing databases to store and analyse marketing and campaign data. Is that all? Does that include the marketing manager’s laptop? What about those disks we posted to the northern office?

Now a database company suggesting that there is a groundswell of desire for people to invest in a single customer view is another one of those happy survey coincidences, isn’t it?

Despite the credit squeeze and the prospect of a recession, we are gagging to spend our meagre budgets on putting all of our data into the same pot, allegedly.

But not, I would humbly suggest, to join up the marketing process. In my experience, the desire is more about joining up the CRM system to SOP and ultimately the accounts. People just expect the marketing team to talk to each other, and the need to see marketing delivering to the bottom line is far greater. But... 

When it comes down to it, few people spend the money. Especially in small business units where one eye is always on the budget, and the eventual delivery thereof. Management information in SME’s is predominantly poor. Mainly because it is complicated and expensive.

You cannot buy these things off the shelf. It costs a lot, not just in cash terms, but in man hours and blood, sweat and tears.

That is why the database investment is always the first thing to be crossed out in red when the time for a budget trim comes around.

MPS buggered in funding row

Exceptional turn of phrase...not mine...but it paints a vivid picture. Basically, Royal Mail collects 0.2 of DM spend to fund the Mail Preference Service, but with new entrants coming in, Postcom refused to make this levy compulsory. So MPS is short of cash. Sorry, am I missing something here?

I pay every month to have MPS flags added to my database. Not sure quite how much, as it is wrapped up in the overall cleansing fee, but I pay. So, our cleansing partner has an MPS license, and they pay for it. Why the need for a levy? Well, apparently it also helps fund the ASA, and keeps license fees down. Bugger is not the B word that comes to mind.

How much does this website and database cost to run for goodness sake? How about some transparency here?

In a previous life, I had some experience of pitching for, and winning, the contract to run one of the major consumer suppression files. Only about 20% of the size of MPS, and I have no feel for the marketing costs, but believe me it didn’t cost that much, and it made a profit based on license fees alone.

MPS is described as self-regulatory. It is responsible for the industry to make a conspicuous effort not to mail people who do not want to be mailed. As long as each suppression costs less than the price of a stamp, it should make sense to everyone to use it.

This thing should be conspicuously self-funding.

Evil Bill versus the Good God Google

Make no mistake about it; one way or the other, the corporate battle for the future of Yahoo will affect us all. If Microsoft fail and Yahoo is left to flounder, or snuggle up closer to Google, someone is going to dominate. Probably Google, who are already the monster when it comes to search engine marketing. Should we be concerned? You bet your last banana we should!

‘Free’ access to the Internet and all the excitements therein is a myth, of course. We all pay for broadband access, at home and at work, but the tools we use still have that allure of being ‘free’.

Thanks to Google, most of the things we do online are funded by pay-per-click advertising and banners. All those things we moan about...and Mr Gates sells us tools to stop the pop-ups and filter out all that horrid spam, not to mention all those nasty viruses.

E-marketing becomes ever more popular, and profitable. For lots of reasons...green, cost-effective, immediate, responsive...direct marketing is being driven online. We just love it, don’t we? It’s the ultimate objective of joined up thinking...straight to the prospect, less delivery costs, simpler creative, instantly measurable and it makes use of that expensive web site, with a little luck.

So when are the boys from Silicon Valley going to come up with the cunning wheeze of an electronic stamp?

Maybe the ‘Do no Evil’ company motto is legitimate. Maybe Google have no intention of taking over the world and then delivering shareholder value by finding other ways of making us pay for their toys...and maybe this comfortably proportioned 46 and a half year old still has a chance of replacing Emmanuel Adeybayor up front for Arsenal.

Despite the billions, online advertising can only grow so far. Once the revenue lines flatten, the big boys will look for other ways to make the graphs continue to grow.

My own view is that consumers will need to pay for more of the services we all spend far too much time on...email, social networking, photo sharing, gaming and so forth...and that companies will be charged some sort of fee...beyond PPC...to join in the fun.

On the other hand...Arsene, you know where I am, right?

Life is a cabaret in the vaudeville world of B2B data

More acts than you can fit on one bill. Following the launch of Infouk.com with Richard Lloyd in the starring role, Cyance, his previous employer, start talking about launching their own blended database, incorporating ‘some of the biggest players in business data.’ Bet you can’t wait, can you?

Blending data is a delicate art, and some people are really very good at it, but you break all the eggs and you still end up with the same old omelette.

There are still only around 3m businesses trading in this country at any one time. They have the same addresses and telephone numbers. However you blend the data, these ‘new’ launches are not going to offer anything dramatically different, are they?

Everyone...and I mean everyone...has the same 1.5 million records, and the rest are a little more variable...with good reasons. The core 1.5m are the true marketable business universe.

When you take out all the suppressions, I certainly believe that the ‘true’ business universe is no more than 2m, and possibly as low as 1.8m. Go on the online search engines and do a count, 1.8m will become a familiar number.

The USP of proper blended databases is insight, adding depth and selectability by coming at each record from several directions. But this is still cold data. It is still matched together, and is therefore only as good as the quality of that original match. Most of the selections will still be estimated. Most of the contacts will still be at least nine months old.

You can rehearse the act as many times as you like, write new jokes and put in a better finishing song, but it is still the same old stage.

There is no point in bleating about more competition, of course...and I am not. My real concern is that this just adds to the inherent confusion in the market.

Everyone dresses up their data set as the best available, and the end user ends up confused, befuddled and potentially disappointed.

Infouk.com is a huge investment, and they must believe that they can capture enough market share to see a return, but B2B data is becoming more and more of a commodity market.

It is like cans of baked beans in Tesco’s. You can have the value brand, the own brand, the premium brand, the brand variations...but they are all still baked beans. All probably grown on the same farm.

Someone in this market is going to die on the stage long before the final curtain comes down.

Infouk.com land with the soft thud of disbelief

InfoUSA trumpeted their launch into the UK market back in October, with claims that they intended to create a quality tele-verified business universe. Using a mixture of ‘publicly available sources’ and 2-3 million telephone surveys, they intended to compete with big boys...and now they have appointed Richard Lloyd, ex-Experian, to head up InfoUK.com...so more of the same then?

Back in October, I pointed out the economics of this venture. Calling the entire business universe (between 2.5 and 3m businesses) once every year is not enough to capture the sort of data they want, or to maintain recency.

It will cost too much, in an overcrowded market where it is extremely difficult to command a premium price. And this publicly available data comes at a price, too.

Presuming that they mean Companies House, possibly via sister company One Source, not only do they need a licence, but they need to do a lot of work to produce a marketable list. They will need to do a deal with Thomson, or someone, to match CH data, producing trading names, telephone numbers and real addresses, as opposed to registered office addresses. Not impossible, but not simple, either, starting from scratch.

Even with a head start, via One Source, it is a hard road. So is this going to be a different, high quality database?

Certainly not in the short term.

It will start out as yet another blended database, and then, only if InfoUK.com are prepared to make 5m+ telephone calls a year, the quality will build up, eventually. 

Believe me, tele-verifying data is not easy. The person at the other end of the telephone only has so much patience. By the time you have confirmed company name, address and telephone numbers, plus maybe one senior executive, it is over. Therefore, there is a need to call back more than once to add further contacts, job titles and so forth. So, 5m calls is a reasonable number...it could actually be 7.5m.

A decent tele-researcher will manage around 8 successful updates an hour. In a 48 week year, based on a 35 hour week, that is 13440 calls. 5m divided by 13440 is a 372 seat call centre. Onshore, just in employment costs at £18k per year, that is an annual investment of over £6.5m. Add licensing costs, a little management, an office and some sales activity to that, plus NI et al, and annual running costs are likely to be £12m, plus heavy start up costs. Just to cover £12m costs selling data at an (optimistic) £140 per thousand average, you would have to sell 85,000,000 records. 

On paper, not a particularly attractive investment, considering the competitive nature of the market.

I can hear the sound of pencils being sharpened in Marlow and Nottingham already...