How to clone your best business customers
Boosting your success up to 40% via predictive modeling
With traditional and electronic media costs constantly on the rise, casting a wide net to reach B-to-B prospects can become prohibitively expensive. Though these media do reach many people, using them to find the right people — your best prospects — is often inefficient.
But what if you could identify and target only your best prospects — those whose profiles precisely match those of your current best customers? It would be like arming your company with a state-of-the-art fish finder that not only locates fish, but will lead you to those most likely to bite.
That’s what’s behind the concept of predictive modeling. AB&C has successfully used this cutting-edge prospecting tool for clients to deliver 20% to 40% higher response than with traditional media — at a fraction of the cost.
For example, one of our B-to-B clients recently challenged us to cost-effectively identify C-level executives at U.S. SMEs (small/medium enterprises) that were considering the possibility of establishing a corporate foothold in Europe. Out of 23 million U.S. businesses, finding these relatively few prospects is akin to finding that proverbial needle in the haystack.
To help us home in on these prospects we analyzed the demographics of the client’s current customer base on 80 different demographic variables — SIC, size, annual sales, number of employees, etc. Based on this, we created a statistical model of the client’s best customers, which is identical to the statistical model of its best prospects. We then ran this model against a demographic analysis of each of 23 million U.S. businesses, and literally ranked from 1 to 23 million how closely each of these resembles our client’s best current customers.
From this, we took the top 80,000 companies that most closely met the statistical model, and these became our high-potential prospect database, which we targeted via email. We have been mining this database via email campaigns to C-level executives at these prospect SMEs over the past several years and we typically achieve open, read and click-through rates that exceed industry standards. We’ve also found that email openers who don’t initially respond can later be converted to viable prospects via a consistent “nurturing” campaign.
What’s more, we’ve compared these results from an ROI standpoint to other advertising media that we’ve been using such as print, banner ads and direct mail. The email delivered 30% more visits to the client’s website at one-quarter the cost of print and one-half the cost of online banners, and delivered an 80% better ROI than direct mail to the same list.