Email Marketing: 3-step email campaign generates more highly qualified sales leads for VC-funded startup enterprise software firm

CHALLENGE

In September of 2003, venture capitalists agreed to fund a new enterprise software firm called M7 Corporation.

In the old days, this would have meant Zack Urlocker, VP Marketing, would get to fling advertising money about with joyous abandon.

However, now it meant he had just 60 days to create a campaign to get hundreds of highly qualified sales leads to raise their hands eagerly and say, “I’m interested in buying your software.”

The VCs and the sales team wanted highly qualified leads, and they wanted them pronto.

Since M7 was emerging from “stealth mode,” practically nobody had ever heard of them. Not the press and certainly not potential customers. The company barely had a website, and zero marketing collateral.

On one hand, this was a dream job because Urlocker did not have any legacy branding to deal with. He got to invent everything from scratch, and the tight deadline was an adrenaline rush.

On the other hand, enterprise software buyers do not purchase from companies they do not know, like and trust for the long-term. How do you build a relationship in 60 days?

CAMPAIGN

Step #1: Identify unique value proposition with key business leaders

The first step involved lots of pizza, caffeine and a cheap motel meeting room.

Urlocker gathered everyone who might have useful input including the CEO, the VP of sales, the head of tech, and M7's marketing agency for eight solid hours of brainstorming.

“We were locked away in this low-rent hotel conference room for a day to get really explicit about what is our positioning and what are our prospects’ pain points.”

To get them started, he presented demographics and psychographics of the target market (culled from analysts, journalists, industry message boards and experience) as well as copies of all competitors’ marketing materials.

Whenever the discussion threatened to get too buzz-wordy, he made everyone view a few competitor ads.

“It’s a reality test. Someone would say, ‘Why don't we say we're this?’ But when you looked at competitors, everyone says the same thing: Blah, blah, blah in high-tech marketing jargon. They communicate with jargon so much that it's meaningless. You have to force yourself to stand out and communicate in a more compelling fashion.”

“We had whiteboards and papers hanging on all the walls of the room by the end of the day. It was pretty intense.”

The team's work boiled down to a unique sales proposition in language that spoke directly to the hearts of prospects, plus an initial marketing plan and white paper topics. “Virtually every piece of communications from then on was derived from this one day.”

Step #2: Use email for lead prospecting and start testing

Urlocker decided to start prospecting efforts with email because it could get results quickly. And he had discovered enough lists (about 15) for his marketplace that he could test some, cut the duds and still have more names to mail to.

To make the most of his initial investment, he tested the following:

• Short copy vs. long copy (samples of both below)
• 5,000 names from five different lists
• A text ad in a highly targeted email newsletter

Creative Sample #1: First touch email from email lead generation campaign, long-copy version

Creative Sample #2: First touch email from lead generation email campaign, short-copy version

Creative Sample #3: Text ad in highly targeted email newsletter

Step #3: Don’t ask for too much from prospects at first

The landing page for all the tests was fairly simple. Urlocker cut descriptive copy to a bare minimum — just a paragraph explaining the offer's benefits. The registration form began above the fold, so visitors did not have to scroll down or click anywhere to see it.

The form was also fairly short. Although M7's sales team wanted lots of information to qualify each prospect, Urlocker did not think the first touch was the best time to ask for it.

“We’re an unknown company, so we had to offer a lot of value and make it very easy for people to come into the information. Then we did ongoing things [to] get people more comfortable, develop a reputation and earn their trust,” he explains.

In fact, he says that if you are an unknown brand, asking for all the data you need to qualify a prospect is “kind of like asking someone to marry you on the first date. It may be better to ask for a second date instead.”

Even before mailing the first test campaign, he lined up a second- and third-date strategy.

Step #4: Send follow up emails to prospects who respond

Urlocker knew many prospects might forget M7's name a few minutes after they left the site, even if they loved the white paper they downloaded. Therefore, he lined up two email follow-ups with very careful timing and messaging to follow the first campaign for a total of three "touches" over three weeks.

Here's how the campaign played out (samples shown previously above in creative samples 1 and 2):

Touch 1: Initial M7 white paper offer sent on a Thursday. Registration form asks for basic contact info. The offer focused on a pain point that prospects had: “Cut J2EE Development Time in Half”

Touch 2: Third-party analyst paper offer sent to respondents of Touch 1 on the next Tuesday. Registration form asks some specific sales-qualifier questions. The offer focused on providing outside credentials for M7: “‘Very powerful stuff,’ The Baroudi Group”

Creative Sample #4: Second touch email in lead generation email campaign

Touch 3: Seminar or evaluation offer sent to respondents of Touch 2 on a Tuesday. Registration form asks still more specific sales qualifier questions. The offer focused on getting prospects to try M7 for themselves.

Creative Sample #5: Third touch email in lead generation email campaign, long-copy version

Creative Sample #6: Third touch email in lead generation email campaign, short-copy version

Prospects who got all the way through the funnel and answered qualifiers correctly were turned over to the sales team as solid leads. Anyone who stopped along the way or who was not qualified yet to purchase was kept on file to be contacted with campaigns in the future whenever Urlocker had a new white paper or newsletter issue.

Despite the fact that Urlocker was in a big hurry to prove to both sales and VCs that he could generate loads of great sales leads, he waited until the responses to his very first email tests got all the way through the three-step funnel before rolling out additional campaigns.

This is because he suspected some high-performing lists  (in terms of initial offer acceptance) might end up generating less-qualified names.

RESULTS

The very first test campaigns exceeded Urlocker's budgeted lead number goals by 294%. In fact, in 60 days he had only spent 23% of his total budget and got 70% of the qualified leads he had expected would take many more months and campaigns to acquire.

More results data:

Average response data through the 3-touch funnel

• Touch 1: 13% of mailed names clicked; 60% of clicks registered
• Touch 2: 61% response rate (opened, clicked, filled out form)
• Touch 3: 53% response rate (opened, clicked, filled out form)

Long copy won hands down

The email blast that included an explicit table of contents for the white paper offer was three times more effective than the shorter email blast.

Urlocker notes this may not be true for all audiences. It is just that his demographic is made up of information seekers and readers.

Ads less successful

Even though the initial cost of a newsletter ad was much cheaper than renting a list for a blast in Urlocker's marketplace, in the final analysis, ads were so much less successful in generating response that they cost four times more per lead.

Urlocker notes again that this is probably because his marketplace likes long copy. The short text ad coupled with his unknown brand name spelled disaster.

However, he still tests newsletter sponsorships when he can get them cheaply enough (often as part of a bigger media buy).

Waiting for results is worth it

Some lists that performed very well on the initial campaign ended up as stinkers after the third touch. Waiting for results before rolling out was tough but worth it.

Originally published on August 12, 2003, as 3-Step Email Campaign Generates More Highly Qualified Sales Leads (Samples Included)

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