Build a powerful marketing database at bargain-basement prices

At Seko Worldwide Inc., the process of building a marketing database started quietly enough. Three years ago the freight forwarder's marketing vice-president bought a copy of Act! and began playing with it on his laptop. "He thought it was the greatest thing," recalls Cathy Moran, Seko's director of sales, training, and support. Seko's president soon caught the bug, and so did a few salespeople.

Soon, what had started as an experiment turned into an essential. Today most Seko sales reps don't leave home without their laptop database. They come to appointments loaded with routing information and historical sales data--what, where, how often, and how much a customer ships. "Today's customer is more sophisticated and technology-driven," says Moran. "We had to do this."

"This"--building a true marketing database--is something many companies think can be done only with a big budget and lots of complex software. Not anymore. Seko's not even a small business: the Elk Grove, Ill., company's sales have climbed to around $106 million from $79 million three years ago, and 100 of its 150 sales reps now use the Act! program. But even at that size, Seko has found that an inexpensive contact-management program like Act! can satisfy the company's need for a marketing database.

Seko is not alone. While contact managers are often portrayed as the poor man's solution to sales automation, programs such as GoldMine, Maximizer, Sharkware, Microsoft Outlook, and Act! can be used to build a fairly potent database, at prices starting at about $99 for a single user and $650 for a five-user network license. Contact managers' implicit promise--that anyone can turn a knack for networking into hard sales--has sent entrepreneurs racing to the computer stores. Still, buying the software isn't enough. In too many companies, the programs end up as souped-up Rolodexes or, worse, just gather pixel dust on someone's computer. Why?

"Databases tend to be a mystery to many people," explains database specialist Linda Keating of the JL Technical Group Inc., in Palo Alto, Calif. "They know the company jewels are stored in it," she says, but don't know how to get the information out. However, experts say the latest versions of several leading contact managers grease the way--despite some technical glitches. For example, if you have salespeople out in the field, you can use"remote synchronization" to send leads and updates to them automatically and then receive their responses at regular intervals.

But technology has never been the entire problem. Even the experts can't agree on exactly what a marketing database should do. Some of them tout its power to sort leads."It's a system for keeping track of people and communicating with them," argues Jeffrey Mayer, author of Act! 3 for Windows for Dummies. "You've got all these names, but you've got to do something with them to turn them into prospects and customers." Just as critical is the ability to know when to move on. "By reading the documented diary of all my communications with someone," Mayer notes, "I can say, 'Why am I spending any more time on this jerk?' "

That's one approach. Other marketing experts focus more on what a database can do for existing client relationships. "A marketing database's customer file should be like a one-page action plan for the customer," says Bob Dorf, a managing partner at Marketing 1:1 Inc., the Stamford, Conn., relationship-marketing company founded by the authors of the best-seller The One to One Future: Building Relationships One Customer at a Time. "It has details like 'Likes to play golf; don't call in the morning,' but it's structured much more around sequentially timed steps toward creating a better relationship."

Confused? That's why one of the first steps in building a marketing database is to define its mission. Perhaps you don't have a sales force pounding the pavement but want instead to use your database to bolster customer service. Take Medimetrix Inc., an Inc. 500 company providing health-care consulting services in Cleveland. The $32-million company chose Microsoft Outlook to log, among other things, the results of a 50-question end-of-job survey, and a follow-up communications plan for current customers.

After you've decided how you want to use the database, walk through your selling process. "I thought I was teaching people how to use a program," recalls Seko's Moran, "but first we had to define how leads come in, how we get an initial appointment, and what happens next--and that took a while."

One of the last steps is, of course, to choose the software--if you don't have it already. Dorf, who uses GoldMine, argues that "the software these days is good enough that it almost doesn't matter what you choose." Still, each package differs. Consider bringing in a consultant to demo a number of programs--using real data--so you can make comparisons.

After you make a selection, pay for a tailor. "The software is so cheap, it's definitely smart to spend $2,000 on a local consultant who can help you customize the program for your industry," says Dorf. "You're playing with a central asset. This isn't just a software purchase; it's a way of doing business."

Benchmark: What Do You Track?

KIM WHITTAKER, president
BABY FAIRE INC., Winchester, Mass.
The business: Consumer shows for new parents; 4 employees; $650,000 in sales
Contact manager: Act! 2
Size of database: 6,800 customers and leads
What it contains: "Objections, or why someone said no; whether a prospect is local or national; a one-sentence business description. I also ask customers what we should do differently next year. In the notes field, I keep all sorts of miscellaneous information and do key-word searches; I track news on a company, so I have a reason to call back a prospect. Because of what I do, I also enter information on customers' kids."

The business: Consultant to banks; 100 employees
Contact manager: GoldMine 3.2
Size of database: 3,000 customers and leads
What it contains: "We use the customer-history file extensively. It gives us the anatomy of a sale, an up-to-two-year running dialogue of all appointments, letters, and proposals. We also use the database to measure sales productivity--for example, a salesperson's calling pattern. With 10 sales reps around the country, the remote-synchronization feature is really important for us. We get weekly updates on all sales activities, and we can see what our reps' calendars look like."

Now what? Taming the Data Beast

How can you keep your database under control? Some tips from the experts:

  • Be choosy about the information you track. Resist going overboard. Says Lon Orenstein, president of Computer Support Network, in Dallas, "When I ask people what they want to track about customers, I get answers like fraternity membership and what color boxer shorts someone likes. It's minutiae that doesn't pay off, and the maintenance is a bear."
  • Develop a simple rating system. As you enter more information, you and your employees must be able to tell at a glance how important each customer is to your company's growth. Marketing 1:1's Bob Dorf suggests assigning each customer a score of one to three on several variables, such as sales, future sales, and referrals. You can set up a similar system for ranking leads.
  • Keep your list clean. Give thought up front to how names should be entered, so that a customer like IBM isn't also entered as International Business Machines. Make use of contact managers' drop-down menus or pop-up boxes that prompt users to fill in fields correctly. "A temp entering trade-show leads can corrupt a whole database," warns Janet Parks, whose company, Marketing Frontiers Inc., in Woburn, Mass., cleans up databases.
  • Identify the best leads--and then turn them over as quickly as possible. The idea isn't to have a bigger database than all your competitors; it's to have a more profitable one. Database specialist Linda Keating once had a client who insisted on maintaining a record on a deceased customer. ("Talk about a dead lead!" she jokes.) Put questionable prospects into a "holding" database and dead leads into a purge file, she advises. To sort out older leads, author Jeffrey Mayer suggests conducting a search by the date that the information was last edited.
  • Be realistic. If you can't get people to enter information in your database regularly, the database won't be of much use. Dorf recalls one company that devised this solution: computer-shy executives relay information about customers they've visited to a dedicated voice-mail box; an assistant transcribes the messages and enters them in the marketing database for all to see.

Susan Greco is an articles editor at Inc.


If you're an Act! fan or a frustrated beginner, there's someone you should definitely get to know: Jeffrey Mayer is a walking encyclopedia of Act! trivia and of timesaving features buried deep in the program. Of course, Mayer has a vested interest in being helpful. He's the author of two Act! for Dummies books published by IDG Books Worldwide. Last year Mayer launched a monthly newsletter, Act! in Action, with advice on pressing mobile-maneuvering issues like how to get Act! to dial all your calls from a hotel room. You can sample the newsletter at Mayer's Web site.

The brisk sales of contact-management programs have given way to a cottage industry of consultants and gadgets. (Did you know there's a machine for scanning business cards right into a database?) The Web sites of the top vendors should be full of case studies and tips, but instead they're mostly useless public-relations drivel. At the Symantec site, at least you can hook into all sorts of Act! add-on products. Maximizer includes a link to a listing service that's offering one free sample search. Most of the top vendors also maintain a list of consultants who have customized their contact managers for a host of industries, but you won't necessarily find those lists at the vendors' Web sites, at least not yet.

The number of add-on products for Act! speaks to both the program's popularity and its limitations. ForecastManager!, a utility from Lon Orenstein of Computer Support Network, will beef up the capabilities of Act!, for example. (But GoldMine users have a forecasting feature included in their software.) Linda Keating of JL Technical Group responded to her customers' needs by creating Database Scrubber and Trouble Spotter for Act! utilities.

GoldMine has prepared a detailed three-page chart comparing the features of its program with Act!, Maximizer, Microsoft Outlook, and Janna Contact. To obtain a copy, call GoldMine Software Corp. at 310-454-6800 or visit its Web site.

OK, you've played around with several contact managers, and they just don't cut it for your business. You've reviewed your customers' needs and concluded you're ready to make the investment in some heavy-duty custom solutions. But what next? See Sarah Schafer's story " Supercharged Sell" (Inc. Technology #2, 1997), which presents three sophisticated, compelling case studies in sales-force automation.

Whatever kind of marketing database you build, it's going to need lots of loving care. Janet Parks, president of Marketing Frontiers, penned The Care and Feeding of Your Marketing Database, a small but clever manual about getting more mileage from this central corporate asset. "A marketing database is like an automobile," she writes. "It doesn't run by itself except downhill." Call her at 617-933-5100 to get a free copy of the booklet.

BABY FAIRE, Kim Whittaker, 10 Converse Pl., Mill Pond Bldg., Winchester, MA 01890; 617-729-4500 94

EARNINGS PERFORMANCE GROUP, Charles Forbes, 830 Morris Turnpike, Third Floor, Short Hills, NJ 07078-2675; 201-379-7772 94

SEKO WORLDWIDE, Cathy Moran, 790 Busse Rd., Elk Grove Village, IL 60007; 847-806-4800 94