You might not be sure what you should be doing with your own customer or prospect database – or even whether or not you have one.
Even if you are sure you need a proper database at some stage, you might have no idea where to start, or it feels like a mammoth task you haven’t got the energy to tackle right now. After all, things are going OK in the business – aren’t they?
And even if you do feel ready to take on the task of building a database, deciding on the route to take can be overwhelming.
Buying a list of data might seem completely wrong or alien to you, but you can’t quite articulate why.
Building your own database sounds like a good idea, but also like the most time-consuming job in the world. And where are you or your team going to find the time or money to do it without compromising customer service?
Perhaps you’ve inherited a database of business or contact names and don’t know where to start? Or maybe you’ve spent a long time organically building a database but aren’t sure what to do with it now?
Small to medium sized B2B firms will probably find this post most useful. If you’re selling to consumers and new to data, you may find it helpful to get you thinking, but I won’t be offended if you leave without finishing 🙂
Getting your head around prospect data and databases
To get anywhere in developing or building your business, you are going to need data. And by data I mean customer and prospect data. I think the best starting place is to acknowledge its importance, its seriousness and its value.
Have a read of the points below. If you agree with at least 3 of them there’s hope for you. If you get up to 8, you’re definitely heading in the right direction. All 13 and I’d like a guest post on my site from you!
With data, you have to:
- Believe in the fundamental importance of all your data (customers, prospects, network, suppliers) – all the remaining points are irrelevant if you don’t
- Own it
- Value it
- Invest in it
- Look after it
- Nurture it
- Keep it clean
- Keep it somewhere safe
- Keep it in the right place
- Use it carefully
- Use it regularly
- Use it with integrity
- Love it.
I’ve borrowed a quote which I thing sums it all up. It’s from the well-known children’s author Dr Seuss, taken from his book The Lorax – which I loved as a child, and now love reading to my kids as a parent.
Unless someone like you cares a whole awful lot,Nothing is going to get better. It’s not.
Dr Seuss, admittedly, was talking about the environment, but I believe the same approach can and should apply to your customer/prospect data in business.
Nine horrible things that happen if you don’t love your prospect database
I usually avoid doom and gloom talk in my posts, but I’m going to break that rule to highlight how important I think data is.
- Your marketing becomes far less effective. Because you’re talking to the wrong people, or your message isn’t even reaching them any more.
- Your marketing will cost you more per customer acquired. Good data is valuable because it opens the lines of communication between you and your customer. It connects you, and it’s far more costly to communicate with people you are not connected with.
- The data you do have will reduce in value and usefulness surprisingly quickly unless you keep it clean. There’s a rule of thumb statistic that B2B data will deteriorate at the rate of around 20-30% p.a.
- If you ignore it for long enough you will have to start from scratch. Data doesn’t sit around waiting for you to come and get it. People change jobs, move house, grow older, buy different stuff – it all happens pretty quickly these days. (Though to be fair, I’m not aware of the rate of ageing having increased).
- Your database depreciates in direct proportion to how badly you look after it. Or, for the optimistic amongst us, it appreciates in direct proportion to how well you look after it.
- You will spend (waste) significant time and money getting it back to good again.
- Your customers will become less loyal surprisingly quickly. Er, hello, haven’t seen you for a while. Meet my new supplier!
- Your customers will forget all about you surprisingly quickly. Er,hello. Remind me what you do again?
- People could become cross and share negative feelings about you. When you have poor quality data, you are likely to be contacting the wrong people about things that are irrelevant to them. And people don’t like this. Do you?
Enough negativity. Let’s move on to a more positive note and talk about how to get it right.
Getting started with your prospect database
It all starts with your positioning (of course….) and knowing very clearly who your target audiences are. Because until you are very clear about that, you’ll have no idea what data will be valuable to you, and where to start looking for it.
If you’re not sure that your positioning is where it should be, or whether you have defined your target customers clearly enough, you might like to first read my earlier article on positioning.
So, let’s assume you’ve worked out exactly who your target audiences are, and you’re looking for data. Here are a few scenarios to help you on your way.
SME’s selling B2B, turning over more than £250k
Let’s say you’re an SME selling some type of professional services, with a revenue of between £250k and £2m p.a.
In terms of clients of yours, corporates aren’t your bag, so you’re looking for larger businesses with between 250 and 2,000 employees, ideally with a UK decision-making head office.
You have specialist knowledge, experience of and contacts in the engineering and technology sector, so that’s where you’re focusing your efforts. There’s a well-defined buying cycle for your services and you know the typical job titles of the people you need to build a relationship with.
You’ve also worked out that as you’re based in Southern England you’re not best positioned to supply to firms in Newcastle, Glasgow and Blackpool. The travel time incurred around briefings and customer meetings makes your rates less than competitive.
In this instance, buying data is a definite and viable option.
But where to get your prospect data?
- The big agencies like DNB (Dun & Bradstreet) hold hundreds of millions of company records, sourced from tens of thousands of different places. If you’re a company yourself, you might be familiar with your D&B DUNS number…. Those like Experian (of credit checking fame) hold both consumer and company information on a massive scale. Personally I’ve always enjoyed using Experian’s B2B list builder – partly for the wonderful customer service you get even if you’re only buying 100 business records.
- Other agencies get the data direct from businesses through different methods, and sell it on to third parties. Check very carefully how they go about this, there are a wide variety of practices out there and not all of them are ethical or even legal.
- Some are specialists in particular sectors and build solid data over time or through a membership model, so trading in data may be a secondary purpose for them. Trade associations, regulatory and membership bodies and Chambers of Commerce would come into this category. Becoming a member may give you wider access to their data.
- And some are service providers in their own right – for example event organisers – who have found themselves acquiring customer data over time in the form of delegates, exhibitors and visitors; and are now realising the value of that data.
Wherever you look, keep a strict eye on data protection rules. For consumer data – go to the Information Commissioner at https://ico.org.uk. And for information on UK business data, the Direct Marketing Association is a good place to start – http://www.dma.org.uk.
SMEs with a turnover of less than £250k
If you sell B2B, and you’re one of the smaller SMEs, then growing your database organically may well be the best approach. This is the DIY model, resource heavy on time, but lower on outgoing cost and can lead to a very clean and reliable database that you know really, really well.
Before the days of LinkedIn, this was rarely a viable option for small business.
Once again, you need to really narrow down your target audience, qualification criteria (a bit on business development planning here), buyer job titles and locations – otherwise you’re going to be trawling through all of LinkedIn’s contacts starting with Aadam Aabbotts.
It’s worth paying out for an upgraded LinkedIn account to get better access and search features. Once you get going and really narrow down who and what you are looking for, this can be outsourced to enthusiastic friends, supportive partners and cash-hungry teenagers. That is, as long as they all understand its importance, the level of accuracy and detail required.
Be strict, spot-check what’s coming in and aim to add a set amount of contacts per day or week.
Simple ways to start building your own prospecting database
- Your own contacts, old colleagues, employees, bosses etc. If you’ve been in the industry for a while, you might be surprised just how many relevant people you know (or have known). Check where they are now and get current contact details. Think back over all your jobs, people who hired you and fired you, people whose speeches you heard, workshops you attended, went on training courses with. Google people. Ask mates who are in similar industries for a few names.
- Exhibitor, delegate and visitor lists from previous years – in your target market. If they went to X event in 2015, they’re probably going to go in 2016. You get the business names, check them against your qualification criteria and if they meet those, search for the relevant employees/contacts on LinkedIn. Ideally at that stage you follow up with a phone call to see if you can grab a direct number, email and/or check a postal address, if needed. So grab a catalogue at your next industry event, and get the highlighter pens out.
- Membership bodies and trade associations. It’s amazing how many organisations publish the company names of members, though mostly they realise that easily accessible contact names are not appropriate. It can be worth becoming a member (even if only for a year) to get fuller access to their data. If you’re locally focused and join the Chamber of Commerce, they may well give you a starter pack of names and addresses. Check its relevance before you just add it to your database.
So, there are lots of different (cunning and practical) ways to gather data. But it’s all about gathering the right data for the right reasons, about quality over quantity, and about how you look after it over time.
I’ll leave you with a final thought.
These are your customers, and your prospects. They are the future of your business – so you should look after them.