The dollars and sense of inbound vs. outbound marketing.

The economic downturn over the past few years has driven many talented yet unemployed people to start their own businesses. These folks take their years of experience and offer it to other businesses through their own specialty consulting or service firm — a firm that they must then market.

Just such an individual contacted me last week. He wanted to generate leads and business via outbound email marketing; however, after learning that he has a few clients, a relatively short buy cycle and a very limited budget, I recommended that he use inbound marketing and supplement it with personal outbound phone calls to his highly targeted B2B market.

OUTBOUND
Email marketing is relatively low cost when a company has built a pipeline of leads and handles its own email distribution via marketing automation. But for outbound marketing (that is going to a targeted B2B list) the costs add up fast.

Quality outbound email marketing lists (those that are made of real subscribers to an online publication and are therefore fully opt-in and have been profiled) cost from $400-$700 per thousand. Most of these top-quality lists require a 5000-name minimum, which raises the list cost to $2000 to $3500. Marketing professionals, including me, recommend testing more than one list at a time. Testing allows marketers to learn which list performs best and gives them the insight to improve the success of each subsequent marketing effort. Testing just two lists brings the cost up to $4000-$7000. If a marketer wants to maximize the success of the program, the message should be written and designed by professionals, which adds to the cost as well.

As a result of these higher upfront costs, many marketers avoid the outbound direct mail channel. Yet it is still one of the most powerful channels for B2B lead generation if done according to best practices. That means that, for lead generation, the mailing quantity must be large enough to deliver a response rate that is statistically valid so the results are repeatable on future mailings. In the B2B world this could be a minimum of 10,000 prospects at a typical cost of $1 each and up. For companies selling high-end enterprise systems, this approach is affordable and productive. But not for small start-ups.

INBOUND
Inbound marketing, on the other hand, is very affordable for the small and start-up business. Good-quality Web site SEO can be obtained for as little as $250 per month. Pay-per-click ads — depending on the market, keywords, etc. — can range from as little as $250 to $1000 per month or more. The same general costs apply to content syndication. Social media costs little in dollars but can cost much in time for a one-person business if done properly. There are many other elements in a comprehensive inbound marketing program, but, for small start-ups, it’s a cost-effective option.

OUTBOUND AGAIN
In addition, however, I recommended that this new business owner not wait exclusively for inbound efforts to make his phone ring. I advised him to identify companies that meet his very targeted profile and pick up the phone and call them or send them individual letters.

As I’ve said many times before, no single marketing approach can stand on its own, B2B marketers. That’s why dollars and sense enter into our marketing decisions.

The more B2B marketing changes, the more it stays the same.

Eric Gannon’s recap of the B2B University event in Washington DC was posted recently on the Business Marketing Institutes Tuesday Marketing Notes. It’s a great post. Without the cost of travel or attendance fees, BMI readers can partake of  “Six Lessons from B2B University“ that are detailed enough to provide real take-aways.

Here are the six points in his recap:

1. Your Prospects Are In Charge Now
2. Marcom 2.0: It’s All About the Content
3. Marketing Automation is Smart. It’s the People Who Do Dumb Things With It
4. In B2B, Social Marketing is Much More than Twitter or Facebook
5. If You’ve Wondered How to Use Social Media for Lead Generation, Here’s How…
6. To Make Your Marketing Program Indispensable, Link Your Marketing Results to Sales and New Business Generation

You’ll want to read his entire post for all the details he shares on each of these points. But it’s the first point that I take one small issue with. It’s not that the explanation is wrong. He notes that prospects can now “use Google, news and vendor Web sites, and social media to freely search and gather all of the information required for making their initial product and vendor selections, largely bypassing your company’s typical marketing program and ‘story’ as their sole source of their information about your product.”

My issue is the dramatic title of Point #1 that “Prospects are in Charge Now.” From my direct marketing point of view, prospects have always been in charge. Whether marketing is inbound or outbound, it’s the prospect who can take action to conduct product research on their own or respond to the outbound content offers sent out by the company.

Offering free informational content has always been the key to effective B2B outbound lead generation. The approach just gets more blog time now. My objection to the language is that marketers should NEVER think that their prospects are not in charge. With that attitude, marketers might give up actively generating leads and only nurture the leads that come their way through SEO, social media outreach and other inbound channels.

When done correctly, generating leads through email, direct mail, SEM, outbound telemarketing and trade shows still works. So marketers should not think that saying “Your Prospects are in Charge Now” is an excuse to give up proven, profitable marketing channels.

Smart B2B marketing calls to action for 2010.

This morning, reviewing dozens of marketing blogs, I was overwhelmed with post after post about social media. I became worried that marketers were forgetting the channels that got us where we are today.

That’s why I was delighted to see Bill Gadless of B2B Web Strategy pass along advice from Jim Logan in “Try adding a call to action to the end of your white papers.”

Business buyers who are purchasing products and services do not want to be “sold” by high-pressure messages. That’s why social media is working. It’s also why today’s most consistently effective lead generation messaging identifies a challenge that prospects may be facing and offers a free white paper, checklist, guide, case study or other content that allows them to learn about ways to meet their challenge. But as soft as this approach may appear, once a lead is generated, every additional contact made should be followed by a new offer and a new call to action.

The suggestion in Bill’s blog is that the call to action could involve inviting leads to pass the content along to an associate or colleague, asking them to register for a newsletter or other subscription or inviting the reader to contact the business for a discussion.

These are all good suggestions. But to apply these calls to action randomly is not a good strategy. The fact is, there are specific stages in the buying cycle of a complex sale and the call to action or offer made should match the prospect’s place in the cycle.

As covered in Russell Kern’s guide “Direct Marketing’s Five Biggest Hurdles (And How to Get Over Them),” there are four stages in the buying cycle: Interest, Consideration, Evaluation, and Purchase.

As you can see, Mr. Kern’s examples — taken straight from his guide — involve matching the correct content offer to the prospect’s stage in the buying cycle. This approach is critical to enhancing the relationship with prospects and moving them forward to a purchase. Making mismatched call-to-action offers leads to email opt-outs.

There’s one thing that social media cannot do well and that is to “predictably” fill the sales pipeline and then — in a controlled manner — nurture leads until they are ready to be handed off to sales. Adding a call to action to every contact is a proven and effective marketing nurturing approach and businesses selling complex products can rarely succeed without it.

Are B2B marketers offering too much stuff and not enough information?

In his latest blog, “Getting meta,” Seth Godin shares his usual instant insight into the world of sales and marketing. This little gem describes the state of the Internet and how services that appear to be the information are really just tools to find the information.

His conclusion: “Right now, there’s way too much stuff and far too little information about that stuff. Sounds like an opportunity.”

That’s what I think about a lot of the B2B marketing content I see — “too much stuff and far too little information.”

It’s important that marketers make sure the content they are offering has real value to the prospect asking for it. To have value to the reader, content should include one or more of this type of useful information:

• A better understanding of the causes of a specific business problem.
• Some best practices for solving a specific business problem.
• What peers or experts are saying about the problem.
• Some kind of self-assessment of how the prospect’s company is handling a specific problem.
• Industry advances being made to make solving the problem easier.

Informational content should not sell the company’s product or service directly (there can be a sales story and secondary offer at the end of the content), but it should educate the reader and position the company offering it as a trusted resource.

So how does a marketer make sure the content they are offering has value? Here are four tips on how to do it:

1. Provide content information that matches the specific needs of each pipeline lead.
   Send a short survey to your pipeline asking them to identify their three biggest challenges. Then target the content you are offering them (white paper, checklist, guide, Webinar, self-assessment) to the issues they have identified.
2. Create content that has how-to take-aways that can be implemented without buying your product or service.
   For example, if your solution is collaboration software, include usable advice on how to improve collaboration without buying your product. That approach positions your company as a trusted “thought leader,” and shows that you truly care about helping them solve their problem — not just selling them software.
3. Offer a mix of some content that is available without registration and some that is not.
   By not requiring registration for content, your company instantly positions itself as a valuable resource. With no registration, B2B marketers can boost the number of downloads of their content to expose their brand to a larger audience of potentially qualified leads. However, a B2B marketer’s ultimate goal is generating qualified leads that can be nurtured and turned into sales. To do this, one must require registration for access to the more in-depth content or informational offers being made.
4. Provide content that satisfies the focus of each decision-maker and influencer in prospect companies.
   Need the approval of the CFO? Provide content that positions the financial benefits of the company’s product or service. Do the same for the CEO, user, department manager, HR manager or whatever titles have influence on — or decision-making power over — the purchase.

Content is not designed to directly sell products or services. It is designed to educate prospects on how their peers are handling similar challenges and subtly edge them along toward choosing the marketing company’s product or service.

Seth Godin got it right; we all have an opportunity. Let’s use it.

Want more qualified B2B leads? Say “show me the money.”

In the short post last week “Some people are better than others,” Seth Godin talked about the value of certain prospective customers over others. He makes a great argument, for instance, that book buyers are more likely to be good prospects for buying a Kindle, not because they read more but because the have “bought” books. What makes these prospects better is the commitment of money to a particular interest.

His example is a consumer one. But his point applies in B2B marketing just as well. Prospects willing to “pay money” or “invest time” to learn something are better than those who just opt in or register to gain free information. Here are three examples of prospects who show the money.

 Subscribers: Prospects who fall into this category are far easier to find as there a number of rental lists available based on buying behavior. A list of subscribers paying to receive an industry publication, for example, is far more valuable than names rented from a controlled circulation publication that is free to readers offline or online.

 Trade Shows: In good times, companies freely pay to send employees to trade shows for learning. In this slowed economy, not as many businesses are participating in or attending industry trade shows because of the cost. Those who do send attendees are seriously in the market for solutions.

 Live Seminars: B2B marketers have long known that offering targeted content generates qualified leads of individuals who have an interest in a subject related to their product or service. Offering a live seminar, however, requires an investment of time on the part of the attendee. Time is money after all. This approach will significantly reduce response over an online Webinar, but those attending should be far more qualified.

 Prospects who are actively researching and evaluating something are closer to making a buying decision. Attracting this type of lead should not be a substitute for filling the pipeline, but businesses that want qualified leads who could close faster, should look for the money.