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Jun 29, 2006
Case Study

How to Offer a Slice of Your Database to Convert Buyers to the Full Product

SUMMARY: Looking for ways to market entry-level items to attract customers for bigger-ticket newsletter and online database subscription products?

One marketer’s answer? Trials of a combined phone/Web demo, where reps ask previous customers to be walked through a 15-20 minute test drive. (Yes, they found enough people willing to do this.)

Question is: should they offer one specific product or a slice of the full database? We’ve got the lowdown on what worked.
CHALLENGE

When Bongarde Media acquired SafetySmart.com about three years ago, it got a telemarketing-only company. “Almost everything was done by outbound calling,” says Bongarde CEO Mark Ziebarth. “We brought in a broader direct response sensibility.”

The company, which serves the corporate human resources audience, sells newsletter subscriptions and database access. Ziebarth wanted to see whether Web-based demos could win new customers with entry-level products (subscriptions) that gave access to “slices” of the company’s full database.

But for this kind of heavy hand-holding, is this type of sale worth it? Plus, what should they offer: a specific product or one that touches on features from the entire database.

“We’re trying to build a pool of lower-dollar buyers that sales reps then can go fishing in,” Ziebarth says. “The thinking is that should be an easier upsell as compared to a cold call for a $1,000 subscription product.”


CAMPAIGN

The company wanted to use multiple channels to sell more subs to its backbone product: a full-access database of info on workplace safety issues. It conducted two important tests to see what would work.

Test #1: Vertical test -- Safety Talks Online

In early 2005, Bongarde started selling Safety Talks Online, a new slice of their full database product created just for this trial. Safety Talks Online would be marketed at about $500, whereas their full database subscriptions started at twice that. “We were trying to get them in the door at a lower price,” says Pete Stowe, Bongarde VP Marketing.

The company tried a 60-day campaign involving 140 telemarketing hours. Their tactic: Using an inhouse telemarketing list of people who had purchased Bongarde products in the past two years, sales reps asked them to agree to a 15-20 minute Web-based demo.

Notably, the company did not use software technology that let reps take over customers’ computers and “drive” them through a demo. The reps simply talked to customers and told them where to click.

Bongarde expected that the reps would have to make four to eight calls before getting a single prospect to agree to the demo. They offered a three-day trial-access offer to a one-year subscription product priced at $450.


Test #2: Horizontal test -- Safety Smart Online Express

In September and October, the company tried a second test but with a horizontally-sliced portion of its full database product -– giving customers a taste of everything that the full product had to offer.

Safety Smart Online Express was marketed as a $497 one-year subscription. “Sub-$500 is kind of a magic number for us on direct response sales,” Ziebarth says.

This time, the company gave customers a 5-day passcode.



RESULTS


In the first 60-day test of Safety Talks Online, the company invested 140 telemarketing hours (actual hours that reps spent on the phone) and got 10.15% of those called to sign up for the free trials.

When the company reconnected with those customers, it converted 7% to full subscriptions to the Safety Talks Online product.

The company found the limited subject matter helped reps stay on script. Such a test demands reps who can quickly engage the customer and get them talking in order to tailor the online demo material.

“The biggest challenge is actually getting [potential customers’] time,” Stowe says. “We ended up needing closing specialists to get these people to agree to the demos.”

In the Safety Smart Online Express test, the company invested 203 calling hours and convinced 9.65% sign up for free trials. Of that number, 4.15% converted to full buyers.

Because of the wider range of material, calls about a broader-based product were harder for the reps to conduct and manage than the specific product.

“People will come up with a lot of questions that telemarketing reps aren’t as equipped to handle as sales reps,” Stowe says. “We had to use reps who are generally more experienced, and we had to spend more time training them on the product. Our telemarketing manager is often present during many of these calls, constantly making comments and suggestions."

What’s the secret to getting and keeping a potential customer’s attention for a 15-20 minute Web demo of your content-based product? A good script, a division of reps who are into expert trial-openers and sales-closers and close supervision.

“Every one of these calls is supposed to be scripted, but they all vary due to personalities,” Ziebarth says.


Useful links related to this article:

Safety Smart:
http://www.safetysmart.com/


WebEx -- example of technology for “driving” customer computers:
http://www.webex.com/

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