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Apr 09, 2002
Case Study

How to Reach & Impress Big Business Purchasing Managers Online (6 Challenges to Beat)

SUMMARY: President Fritz Hall admits he did not expect that a 150 year-old "smokestack" company like Benton Foundry would find its marketing profoundly affected by the Internet.  However, he discovered that dramatic changes in the ways that big companies run their purchasing departments presents six challenges:
1. The move to centralized purchasing,
2. Less experienced buyers,
3. Increased purchasing contact turnover,
4. Sales literature is trashed,
5. The voice mail barrier,
6. International HQs. Hear how Hall's remarkably simple Web site helped him beat these challenges.  Now he gets 40% of new business leads over the Web.
CASE STUDY

CHALLENGE

President Fritz Hall admits he did not expect that a
150 year-old "smokestack" company like Benton Foundry would find
their marketing profoundly affected by the Internet.

To keep sales coming in, the Foundry relies on close connections
with procurement and purchasing managers for large companies
requiring custom iron castings. In the past, you could build a
long-term relationship with a purchasing person. Regular buyers
would even fly out to visit the plant every year or so.

But in the past five years "the marketplace drastically changed."
Suddenly Benton Foundry had six serious sales challenges (many of
which have affected other industries also trying to reach
corporate purchasing departments):

1. Centralized purchasing

In order to save money, many large American companies are
centralizing their purchasing and procurement departments. Now
instead of interacting with "good qualified buyers that knew the
product and knew us," Hall says, "centralized purchasing managers
have never seen the product and never will see it. It is shipped
to a different location."

2. Less experienced buyers

These new purchasing managers tend to be different from their
historic counterparts in that they are both younger and less
experienced in buying iron castings. In fact, they may have never
even seen even a picture of an iron casting in their life, much
less visited a plant. (With business travel budgets cut back
to bare bones, few will ever do so.)

3. Increased purchasing contact turnover

In the past, many purchasing managers stayed in jobs for years on
end. Nowadays, people switch jobs frequently. Hall says,
"There's massive turnover in purchasing people. The larger the
company, the worse it is. The average buyer only stays in that
job for 10 months. Then they get moved to other areas of the
company, or switch jobs."

4. Sales literature is trashed

Unfortunately when these people switch jobs, they rarely leave
sales brochures or other printed marketing materials behind them
for their replacement to use. "When these guys move, they really
clean their offices out. Sales literature normally gets
trashed."

5. The voice mail barrier

New procurement managers are unlikely to pick up the phone when a
sales rep calls, or to ever call a rep back. Instead, they rely
more and more on voicemail to stop all calls from reps they do not
know.

Hall explains, "A few years ago you could call and make an
appointment to meet with someone new. Now these guys screen
their calls with voicemail. If you're a supplier, they don't
want to talk to you. You can't set up appointments."

6. International HQs

Although all of Benton Foundry's customers are US-based, these
days a solid 30% are owned by companies headquartered outside the
US. This means procurement decisions might be made, or require
approval, by someone in different country who has never heard of
the Foundry, and who is much harder to reach via offline
marketing methods.

All six of these challenges meant Benton lost existing
relationships and client-side education that had taken years to
build.

CAMPAIGN

In early 1997, Benton Foundry launched a basic Web
site. It did not feature any bells and whistles, and only
contained seven simple pages including the Home page.

These seven pages featured concisely written, straightforward
copy about the company's capabilities, along with a few small
pictures of staff, facilities and products. The Foundry's email
and phone number were prominently displayed at the bottom of
every page.

There was no long company history, no detailed specs sheets, no
online forms to fill out, no interactive tools, no white papers,
no officer bios, no press releases. In short the site was a
peeled down version of a B2B site reduced to bare essentials.

Hall did not expect the site to make a huge difference. "We put
it up from curiosity."

Indeed he was right. For the first couple of years the site
got almost no traffic. Then in 1999, things began to change
rapidly, not because Benton was doing anything differently but
just because the marketplace was ready. "More and more people
are using the keyboard to look for things."

Hall decided it was worth investing more of his energy and
marketing budget online. He had been advertising heavily in the
print editions of Thomas Regional Directories for more than 15
years. Now, he moved some of that budget from four-color back
cover print ads to paid listings in Thomas' online edition. He
explains, "We've gone to a smaller ad in the book, because our
name still has to be there, but the function is more and more on
the Web." These Thomas listings included hotlinks to his site.

He also made sure that other online business directories, such as
The American Foundryman's Society and the Ductal Foundry Society
sites, included links to his site.

As traffic picked up Hall personally surveyed a lot of larger
customers to find out if Benton Foundry was going in the right
direction with its Web site. "I contacted them and asked, 'Have
you looked at our Web site? Do you have any comments?'"

The results would dismay Web developers trying to sell business
marketers fancy sites for a lot of money.

Turns out buyers loved the super-simple site. Hall says, "I
learned a lot of company Web sites are too complicated. They'll
give company history, lots of info. Frankly buyers do not want
to read that. They want to know what you do, and what your
products and services are. If you get too long, you'll lose
them."

He adds, "One comment that was very common was the fact that they
liked the shortness of our site. That there was not a lot of
information there that they weren't interested in or they
couldn't use. They liked that it was basic and it was focused."

He also learned that buyers really, really liked seeing
photographs on the site. "A lot of these buyers in big
corporations have not seen a casting, a lot of them have never
been to a foundry. When they see on their computer a picture of
metal being poured, that's the first time they've ever seen it.
The photo gives them the sensation of what's made and how it's
made."

Benton Foundry was getting enough sales leads from its site that
when so-called B2B dot-com entrepreneurs first came calling
offering to sell Benton's products via online auctions and
marketplaces, Hall was open to talking to them.

However, he quickly decided it was not the way to go; at least
for now. Hall explains, "It's a very common situation that the
people running these systems know absolutely nothing about
casting or the industry. They're using the word 'commodity' and
castings are not a commodity. Every casting we make is designed
for that customer only."

He was also not happy with the lack of a serious, supplier-side
screening process. "They have to clean their act up. There has
to be a major screening process prior to the bidding process for
quality standards, on-time delivery, etc. Online bidding
generally does not take this into account."



RESULTS

Currently about 40% of Benton Foundry's new sales leads come directly from buyers who learned about the Foundry
from its Web site, the Thomas Web site, or other online business
listings.

Hall is very satisfied with his Thomas online listings and has
doubled his total ad budget with Thomas over the past five years.
He notes that only about 2% of his Web-generated leads come from
the trade association Web sites he is on because so many of the
less experienced buyers have no idea the societies even exist.
However, he will keep paying for those listings as well because 2%
is better than nothing.

Hall attributes much of his online success to the fact that so
many buyers are younger these days, and "the younger buyers just
out of college are very computer literate. When they're looking
for a product, the first place they go is online. That's why
we've seen a drastic pick up in the past three years."

He also notes that the Internet is a great place to impress
multinational companies. Many of his site visitors are located
outside the US, recommending or approving suppliers for their US-
based operations.

Interestingly, although so many leads come from online, almost
none come in through email even though the site promotes the
email address in every page. Hall says, "The initial contact is
Web, but basically 100% will pick up the phone and call."

The only change Hall plans to make on the site this year is to
add more pictures. He says, "A picture is worth 1,000 words. If
I tell you our plant is 220,000 square feet that's one thing, if
I show you an aerial photo of the plant, that's a totally
different situation. People like to see who they're dealing
with." Especially when they may never get the chance to meet you
in person.

http://www.bentonfoundry.com

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