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Join Our Research Team at DMA 2014
Feb 12, 2002
Case Study

Reaching Fortune 1000 Sales Prospects Online

SUMMARY: When Jeff Kuzmich joined Element K as Internet Marketing Manager in October 2000, the company was barely spending any money on outbound Internet marketing. Kuzmich was given two primary goals:

1. Test a wide variety of outbound Internet marketing to promote the Element K brand.

2. Generate qualified sales leads of Fortune 1000 VPs of HR and Training for the sales team.

In just one year, Kuzmich tested banners, ezine sponsorships, broadcast email campaigns to rented lists, and email marketing to the Company's own house list.  Find out what worked and what he learned from it. (BTW: This Case Study...
CHALLENGE

Jeff Kuzmich's target market was decision makers, such as VP Training and HR, in Fortune 1000 companies who could authorize or influence the purchase of Element K's e-learning products. Enterprise-wide investments can run $30,000 or more.

Element K's sales cycle could take as long as nine months, so he had to get cracking right away.

CAMPAIGN

Kuzmich began by coordinating with the Company's media buyer Sue Butler of Butler/Till Media Services. Previously Butler had directed nearly 100% of Element K's media budget toward space ads in trade magazines designed to grow brand awareness. Now Kuzmich asked her for suggestions to redirect about 15% of the budget to online media.

Researching B-to-B online media options is not as easy as researching B2C because many of the media planning tools just do not have much information on niche B-to-B . So, Butler spent hours surfing the Web looking for the right sites. She says, "It's definitely time intensive. You have to sit there doing keyword searches. Just keep looking. There's a lot of junk, as you know, and a lot of good stuff too."

In early 2001, Butler presented Kuzmich with a list of all the sites, email newsletters and email lists available for rental that she had found, together with her recommendations.

Although she suggested Element K stick with the "top three-to-four" in each category in order to make sure their media spend had real impact, the rest of this researched list was still very valuable because Kuzmich could use it to do low-cost guerilla marketing throughout the year. Butler says, "He can get on directories, use it for PR, request reciprocal links, or try to work with them in some other way."

How did Butler decide which sites to actually buy banners on? There were only about six training sites with Fortune 1000 traffic, so that decision was easy. HR sites were harder to pick because there are so many of them. Butler says, "I looked for volume -- what's the site traffic, how many monthly page views. Secondly, ideally I liked them to have a training channel. HR is very broad, so it helped if I could target by banners to HR pros interested in training."

Cost per thousand (CPM) was also a factor. Often sites associated with trade magazines won on this count, simply because Element K was already a print advertiser, and Butler could negotiate a cost-effective, multi-channel deal with them often including print, banners, email newsletter ads and email list rentals.

Kuzmich's banner creative strategy was a mixture of branding plus direct response. He explains, "Banners followed our brand guidelines in color and placement of logo from our site and other marketing. Based on studies, banners are fairly high from a branding perspective." The copy on each banner also reinforced the brand's main message: e-Learning with the Human Touch. Every banner ended with a call to action: 'Click here for a free trial.'

"In this medium," Kuzmich says, "people have attention deficit disorder. You just see something out of the corner of your eye -- an animated gif, scrolling text. You have very little time to get a single message to somebody. If you try to have 10 messages scrolling, it would require somebody to sit there and watch it."

Although Kuzmich's creative team replaced banner creative on a regular basis to keep it fresh, they did not have many size options. Butler laughs, "A lot of core sites say, 'I can give you 468x60 or 468x60 or 468x60.' It is not like InformationWeek where if you can dream it, it is available. So we encouraged the sites to explore different options. We would work with webmasters, 'Gee we'd really like to some skyscrapers, or some buttons, or some sponsored links.' It's changing…"

Butler picked which email newsletters to test ads in by looking at job-related demographics such as title and company-size. She also always read a few back issues to make sure Element K's message was a good fit. Then she negotiated for a top position whenever possible.

"Newsletter ads are pretty cost effective," says Kuzmich. "A lot of times it's quite a bit less than a banner, and I could put more words in than I could on banners." That does not mean he jammed the available space full of words (a very common mistake neophyte email newsletter sponsors make).

He explains, "Some ezines would say you can have 150 words, but I'd usually only have about 30. People just wouldn't read a thick paragraph of text. If you're Web marketing savvy, you'll have headline copy with a link to more information. Just a couple of sentences of very hard hitting information and then a link."

Kuzmich also kept his copy tight for broadcasts to rented email lists. His average broadcast email ran less than half a page when printed out, with all paragraphs at only four lines or shorter. He worked very hard on email subject lines, "I always considered subject lines the most important thing. It was a matter of thinking about the perspective of the reader -- making sure the subject lines was very compelling without being too promotional."

Although his email campaigns all offered the free trial, he purposefully did not use the word "free" in subject lines for fear that Fortune 1000 recipients' email spam filters would stop the email from reaching them.

In addition to rented lists, Kuzmich launched a series of campaigns to Element K's house file. However many of these names hadn't been emailed since they opted-in, so he was very, very careful about approaching them. "We were very cautious because of spamming issues. We had our telesales group call everybody and ask if it was ok to send them email offers. Some of these names were a few years old, and I was afraid they wouldn't remember giving permission to us."

Telesales found that many, perhaps 25% or more, of the house list's email addresses were incorrect because customers' and prospects' emails had changed.

Once his house file had re-opted-in, Kuzmich continued to treat this list of Element K's best sales prospects with kid gloves. "I didn't want to bombard them."

He tested a different type of email offer to the list every few months. Tests included cross-sales campaigns offering a discount on products related to the ones the customer already purchased, a renewal campaign to expiring accounts, and a referral campaign asking customers to refer colleagues in exchange for a free trial to the Company's journals.

Last, but not least, Kuzmich researched and tested search engine optimization firms that claimed to be able to improve the site's search engine rankings.



RESULTS

Element K's online marketing tests were so successful that the Company has increased its budget for online marketing from the approximately 15% spent in 2001 to an approximate 20% in 2002. (Back in 2000, the budget was less than 5%.)

The sales team were happy with the leads generated, and continue to close new accounts with Fortune 1000 companies. (In fact, at this time over 70% of the Fortune 100 are customers, including Honda, Pepsi and IBM.)

More results:

- Element K's click throughs were generally better than industry average. Banners did well at .3-.5% click-throughs; rented email lists performed a bit higher than target at 10-14% clicks; and ezine sponsorships were more than double the B-to-B average at 2% clicks.

It is worth noting that all email campaigns were conducted in text-only, partially because this creative was easier, but also because HTML campaigns are less likely to get through to Fortune 1000 executives due to spam filtering or email systems such as Lotus Notes which do not read HTML properly.

- However, Kuzmich found himself frustrated over the ability to track leads all the way through the pipeline from click through to sale. As it became apparent that Web marketing was going to continue to be major component of Element K's marketing investment, he was able to invest in measurement tools from dockside.net and internal efforts linking sales and financial databases in order to track true ROI for 2002 campaigns.

He says, "It's a big improvement this year. For example, last year tracking exchanged links was a catastrophe, now dockside can track them. dockside's tech is easy to work with." Butler is also excited by about being able to track media buying by ROI rather than just clicks. She has already begun to test buying lower, cheaper sponsorship positions in ezines to see if the ROI pans out better.

- Although Element K's free trial offer worked well in 2001, Kuzmich sensed from late-year results that it would need to be changed in 2002. He explains, "You'll eventually get smaller amounts of traffic, because you're making a concrete offer. Even if it's a 30-day trial, you're still assuming they know what e-learning is, that they're comfortable with it, and they have no questions. It sounds like a soft offer, but it's harder."

So, during the late fall of 2001, the Company launched an email newsletter featuring training advice. Initially it was simply offered on Element K's Web site, but now Kuzmich plans to make it one of his outbound emarketing offers for 2002.

He says, "I want to market on the basis of interest, not on the basis of a specific promotion. When you have a database of people interested in e-learning, use drip irrigation marketing to continue a dialogue with them. Here is continually more information, and some value adds for them. Add an online event on e-learning … start to populate a database and learn more about them."

- Email campaigns to the house list drew mixed results. The upsales offers, giving current customers a discount on additional purchases did extremely well for hard offer emails. The first drew a 3% response rate, and the following three sent in each of the next quarters, drew about a 1% response rate.

3.3% of customers who received the refer-a-colleague email responded favorably. Of these, the average responder referred three colleagues. (Note: this is about double the average number of referrals from other B-to-B campaigns MarketingSherpa has heard of.)

However, the emailed renewal effort was a bust. Kuzmich explains, "Honestly, if you're an HR decision maker and you've been sold by a pretty seasoned, savvy, intelligent sales rep, and then and then got an email saying 'Oh your account is expiring', you might not be too pleased." With these results in mind, Element K's sales force has sprung into action, now calling major accounts monthly to see how things are going and keep communication alive.

- Kuzmich also had mixed results from search engine optimization -- not because it did not work, but because finding the right firm to work with was difficult. The first firm he tried was a small local company who could not handle the account properly.

The second firm sold him on the idea of paying by results instead of a flat fee for optimization. This too did not pan out, "Our rankings didn't change that much, and we had to constantly follow up with them." (This may be because firms that charge by result have little incentive to go the extra mile once they've done the easiest things. Instead they sometimes just move on to the next new customer.)

So Kuzmich researched firms again, and this time picked a company that specialized in best practices. He says, "They educated us on realistic expectations, helped us with our title descriptions and relevant link popularity, told us every quarter if we needed to re-optimize pages or not. It's the high road approach. They don’t use devious tactics to outwit the search engines that may get high initial results but then get you blacklisted."

In less than six months, the SEOP firm's best practices tactics raised Element K's rankings to a higher level than ever before, and site traffic grew by 10-20% accordingly. Traffic continues to climb each month.

Useful links related to this article

Element K
http://www.elementk.com


Butler/Till Media Services
http://www.butlertillmedia.com


dockside.net
http://www.dockside.net

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