data to their files and be able to segment the market based on the data.
But if you go one step further and establish a relational demographic field on the database and populate it, then you have a segmentation scheme that is not easily duplicated. In other words, you may be able to perform
“stealth marketing” and outsmart the competition. Granted, the data will have to be obtained on a company-by-company basis, and the task will most likely involve the sales group, but I guarantee that it will be worth every dollar of effort. To start, try for only one relational demographic ele- ment and then use it to good effect, and enjoy the results.
are “leads.” They are cold suspects and should be referred to this way.
Note that at this stage of the sales cycle, suspects are almost always com- panies and not individuals.
• Inquiry. An inquiry is someone who has figuratively raised his or her hand in response to some form of marketing communication. Inquiries are not yet leads, in that you have no idea at this stage whether or not they have serious interest or can even qualify to buy your product or ser- vice. Inquiries arrive from different sources and methods, and no matter how they arrive, until they are qualified as leads, they should be called inquiries. One of the biggest mistakes marketers make is to call an
“inquiry” a “lead.” There is a significant difference between the two, and this topic is taken up in detail in Chapter 6.
• Lead.A lead is an individual who represents a company who can buy your product or service and is seriously interested in doing so. There may be several lead categories, including the always famous “hot lead.”
Another common lead category is “demo,” which is usually a whole step up from someone who has merely expressed an interest and capability to buy. Regardless of how may definitions you feel are required to fit the sales cycle in your company, the lead definitions are critical to the inte- gration of sales and marketing to form the new sales coverage model.
This level of definition is the ones where the most conflict has occurred between marketing and sales. Again, much more on this topic is covered in Chapter 6.
• Proposal/quote. In most B2B situations, there is a proposal or quote step. This, of course, is where the process of obtaining a new cus- tomer is quite active and handled by the sales group. Since this is such a sales-intensive process, it may be important to cease marketing commu- nications during the proposal phase so as not to confuse or disrupt the
“close.” You can’t do that unless it’s coded on the database as such; in some cases the record should be flagged so no marketing communica- tions go to this company until the close is achieved by the salesperson.
• First purchase.Customers are not just customers; they remain in the sales cycle even though they have purchased. The first customer def- inition is “first purchase.” The reason this category is important is that after someone buys from your company for the first time, you may need to focus more on that customer to help ensure the second purchase. Stud-
ies have indicated that in predominantly commodity areas (such as office products) there is little correlation from first purchase to second purchase.
The first-time buyers may be trying you out and therefore may not really think of themselves as customers yet. Some companies make the mistake of assuming that their salespeople will readily pick up these new cus- tomers and treat them properly. The ironic truth is that this may be the exact time to increase marketing communications to help confirm the decision to buy. Customer satisfaction calls, welcome letters, and the like should be directed at first-time customers to accomplish one goal—ensure the second purchase. The same studies just noted indicate a correlation to repeat and long-term purchase once a customer has bought for the sec- ond time.
• Repeat or good customer. The repeat—or good—customer is a general definition that distinguishes this group from the new or first- purchase group. Customer marketing is detailed in Chapter 8.
• Past customer. Here’s a question all marketing and sales depart- ments must answer: When does a customer become a past customer? Is it after some artificial accounting period, such as a year? Or is it when the customer feels disinclined to buy from you again and considers him- self or herself a past customer? At IBM one industry group was asked how it defined this category, and the answer was that if a company hadn’t bought within an eighteen-month period, it was officially a “past cus- tomer.” When these same “past customers” were surveyed, the surpris- ing result was that almost 50 percent said they were still customers of IBM. A disconnect, to be sure. If we had begun to communicate to these companies as “past customers,” we definitely would have been sending the wrong message.
Defining the “past customer” category may be more important than you think. To exemplify, here’s one of my favorite stories. Several years after I left Quaker Oats and had started my agency in Chicago, I learned that one of my Quaker associates, Dick Hardin, had joined a company named Oil Dry. Our companies were housed in the same building on Michigan Avenue, and on the elevator one day, there was Dick, now VP of market- ing. We caught up quickly and set a lunch date for the following week. At lunch, we got into some heavy discussions of what each of us was doing, and since Dick was one smart guy and marketer, I was eager to hear about
his experiences at Oil Dry. The company sells bentonite clay to facilities to soak up oil from the floor of the plant—not one of the most exciting businesses. After some top-line “branding” discussion, Dick looked up from his soup with a sheepish grin and said, “John, actually the most suc- cessful marketing thing I did last year was with our past customers.” Since we marketers are always focused on new customers, I was a bit taken aback by the comment. Here’s what happened. Soon after joining the company, Dick was asked by the president, his boss, to help find a job for his retired secretary, as she was bored and wanted to return to work after having been gone for almost a year. Dick was stumped as to what she could pos- sibly do, until he landed on the idea of having her call the old customers who were not currently buying. She knew most of them and was happy to be back at work. At the end of six months, when Dick analyzed the results of all his new marketing initiatives, one had far outpaced all the others, and that was the former secretary’s calling past customers. The actual sales results spoke volumes. Chapter 8 has more on customer loyalty, but need- less to say, past customers can be a source of new business—as all too fre- quently, when they stop buying, the sales group stops calling.