"We're having phenomenal success -- things are going really well for us," Paul Pellman, EVP Marketing & Products, Hoover's Inc. told ContentBiz.
The company has been through tremendous business model changes during its 15 years in business, moving from print to online, and individual subscriptions to group subscriptions. Each move was successful for a while, and then management shifted the model again to gain greater revenues.
After being acquired by D&B in 2003, Hoover's headhunted former Terra Lycos subscription marketer Pellman.
How would a direct response marketer -- one used to selling $20 a month offers to consumers directly online -- handle the strictly business-to-business subscription world where sales reps close all deals and the Internet is used for prospecting and fulfillment only?
During our exclusive interview, we discovered seven lessons behind Hoover's current marketing success.
Lesson #1. Maximize search marketing
In the past Hoover's had been known as an aggressive online and offline brand advertiser. Now Pellman notes that the vast majority of the ad budget goes to search.
Instead of building the brand so Hoover's is top-of-mind when a prospect needs it, he puts the site into the search path in that time of urgent need. "We call it 'caught in the act.' We catch them in the act of doing research. People stumble across Hoover's in the process of search." Some may not have ever heard of the brand at all.
"You've got a big sales call tomorrow and you want to be prepared, and you're doing it at the last second. You're scrambling to get up to speed and you have a nanosecond attention span. You're going to the Web search engines, and you're overwhelmed with data. You're picking and choosing where to go, going back and forth. In that process they realize what they get for free and what they might get from Hoover's."
Of course this means Hoover's must appear against thousands even tens of thousands, different potential search queries, so whatever the prospect types in their desperate search for information, Hoover's is there. It also means that Hoover's search result wording, and landing page, must be obviously of higher value than the other results for free content elsewhere.
Pellman has split the task of search visibility into three teams.
o Search engine optimization for organic results (aka free or natural listings). This is outsourced to a heavy-duty SEO specialist firm who continually works on improving and extending reach.
o Paid inclusion feeds to help get otherwise barrier-ed pages noticed by search engine spiders for organic listings. (Note: Only a few limited search engines accept these feeds anymore, a fact Pellman rues.)
o Paid search ads (PPC) handled by an in-house team of two full-time experts.
Most critical for all campaigns: Pellman's teams track results metrics more carefully than almost any other publisher we've met. They do the obvious stuff -- cost per click, ranking, conversion of clicks to prospects via online registration forms.
They also do advanced stuff, including tracking results all the way down the sales channel so they really know which precise terms paid off and which didn't. Plus, they've set up dozens of toll-free phone lines, assigning each to a different group of search terms. This way they can track the incoming phone calls by general search term and assign an ROI to results via phone and not just Web form. (We love this idea.)
Pellman admits that if the phone company let him, he'd extend it to having a separate line for each and every search term. But it's impossible with the wealth of terms his teams target.
Lesson #2. Focus on getting that inbound phone call
Pellman notes the very best prospects, those who desperately need the access to paid content right away, usually will pick up the phone and call in instead of filling out the form on the barrier or trial offer page and waiting for a sales rep to contact them.
So offer pages are constructed to focus on that phone number and promote calling in. Filling out the form is the secondary goal, not primary. This single design instruction has helped raise Hoover's sales significantly.
Plus, as Pellman says, sales reps love prospects who call in. And a happy sales team is a sales team that meets its targets.
Lesson #3. Test your registration form
Inevitably some prospects will choose to fill out the form instead of using the phone. In this case, the goal is to get as accurate and useful information from them as possible, while not making the form appear so arduous that prospects bail instead of typing. (According to MarketingSherpa stats, the percent of business prospects who'll fill in a typical free registration form ranges from 6%-11%. So careful form design is critical to increase conversions.)
"We've tested forms. We've tried a bunch of things," says Pellman. Some key learnings:
o Try to get all your questions above the fold instead of expecting prospects to scroll down to keep answering questions.
o Don't split questions into two or more pages. "If you just ask for email address on page one, and then you ask for more information when they get to the next page, they are shocked. They thought they were done. It works better to get the full form on the page where you want the response."
o Limit questions carefully, but it's OK to ask for mailing address. While some marketers have gotten better conversions asking for just name, email, and phone, Pellman says cutting street address questions hasn't helped his form results. In fact, he believes "Providing mailing address is pretty innocuous. I think it actually comes across as too stark if you just ask for email and phone. With mailing address you can ease them into the habit of giving you data."
Lesson #4. Don't offer discounts
"Discounts don't work," Pellman says flatly. "If you don't talk about price up front, discounts are essentially meaningless." Why not talk about price up front? Because a consultative sales pitch works the best by far. You find out what the individual prospect's problem is on the phone, then you explain how Hoover's can solve it. Pricing is at the end of the conversation, based on what they can afford.
So, you're not selling a discount, you're selling the end of pain.
On the other hand, you may need an generic offer in some marketing materials to provoke a higher response rate. In that case, Pellman recommends product-related offers. "I'd rather give free sales leads or something the prospect can use now to make the service work. Focus on the value of the service, because if they're not interested in the free trial they won't be interested in the subscription."
How long should that trial be?
Lesson #5. Offer short trials (seven days) and don't extend them
Unlike most B-to-B publishers who offer prospects 30-day trials, especially for higher price points that may require a longer sales cycle, Pellman tries to stick with a seven day trial offer.
"We haven't tested a lot and we don't have super hard results that shorter is better," he admits. "But longer trials give someone the excuse not to go to the next step."
Instead he made the rule that no prospect can start a trial without first talking to a sales rep on the phone. "It's like handing the keys to a Ferrari to someone who doesn't know how to drive. It's not that Hoover's is hard to use, but we're not giving you any context. We need to find out about your business and show you how to use it to meet your needs. Then if you don't use the trial during the seven days, it's almost irrelevant because we started the dialogue on how we can help you."
What if prospects ask for longer trials? "That's been a challenge. How do you turn a request for an extended trial into a sale instead? You tell them, 'You know how it works, let's talk about how it can help your business, let's get moving!'"
Lesson #6. Use Web conferencing instead of self-guided tours
"A picture is worth a thousand words. We've learned to try to get them on a Web conference right away." If a prospect calls in, the rep immediately asks them if they are near a computer and sends an email link at that minute to start a Web conference.
For form fillers, reps call and email requests to do a personal site tour via Web conference. If the prospect is an influencer but not the end purchaser, the rep tries to get both parties into the conference.
Why not offer a generic site tour instead? Because prospects' pain is never generic. Each is in a specific industry, with specific goals and questions. The marketing department has created loads of collateral materials so sales reps always have something related to various prospect types on hand. But the best thing is always a rep-guided tour of Hoover's seen specifically through the lens of how the site can solve the prospect's top problem immediately.
Which of course means there's no generic Web conference tour either. Every presentation is custom-tailored on the spot for maximum results.
Lesson #7. Track usage to keep renewals high
The number one question every publisher selling site license renewals dreads is, "Well how much did we use this service in the last year?" It can kill a renewal, or at least cut the deal size.
While Pellman notes Hoover's is lucky because the service sees unusually high use rates from most customers, his team still tracks use rates carefully year-round.
Then, if they see a customer not using the service very much, they can intervene as early in the term of service as possible, helping the customer become a heavier user. "It's a pretty immense effort to track and make sure they're all getting value out of the service."
The follow-up team is a separate group from sales. "You want your new account sales totally focused on inbound lead volume." Follow-up efforts include direct postal mail, email, and, naturally, phone calls. "We're seeing really good impact," says Pellman proudly.Useful links related to this article:
ContentBiz Sept 2002 Case Study on Hoover's Business Model: http://www.contentbiz.com/barrier.cfm?ContentID=2157
iProspect - the SEO firm Hoover's uses: http://www.iprospect.com
Inktomi - the paid inclusion feed Hoover's uses: http://www.inktomi.com
Coremetrics -- the Web analytics service Hoover's uses to track results and run tests: http://www.coremetrics.com
WebEx - the Web conferencing system Hoover's uses to give customized site tours to prospects: http://www.webex.com