Venture Grows From Within to Integrate Its Services
"Alternative media is making us a better list company,'' said Bob Dallas, executive vice president of list services at Venture, which got its start in card packs.
List companies can follow two paths to integration. The popular route is to add capability through mergers, alliances or partnerships. Venture has chosen the longer, more arduous -- and potentially risky -- route of building from within.
The company changed its name from Venture Communications in January to signify that after 15 years it has developed its nine divisions -- which include list management, brokerage and compiled lists -- into a fully integrated marketing service.
"Integrated marketing is far more difficult than it sounds,'' said Richard Baumer, Venture's founder, president and CEO. "It's been a long process, but we finally have the formula perfected to cross-promote.''
Venture calls the formula compound marketing. Just as interest in a mutual fund can be reinvested, Venture takes the profit generated for a client from one medium, such as list rental, and uses it to tap another, such as inserts.
Although the company is not recognized for its lists, those divisions generated 50 percent of its $60 million in sales last year. According to 1997 SRDS listings, Venture had more lists under management (265) than all list companies except Direct Media. In the last month, Venture has added the 1.2 million-name Super Sports database from the Kleid Co., as well as the 628,000-name Genesis Direct Sports buyer file.
Compound marketing only works when the individual divisions are strong, Baumer said, and the only way Venture can be a market leader is to strive to be the best across the board.
"Each division has to stand on its own, be profitable and bring an added benefit to our clients,'' he said. "With us, clients can try things they haven't tried before.''
The separation of divisions prevents employees from having to juggle a number of duties, allowing them to focus on a particular specialty. Yet, because they are part of the same company, Venture can draw on their different areas of expertise to give clients more leads and marketing options than an individual list manager or broker. It also can draw on profits generated by other divisions to pay for list promotion.
Deer Creek, Pompano Beach, FL, a direct marketer of household merchandise, increased its mailings from 300,000 to more than 30 million pieces since selecting Venture as its list broker in 1994. Venture moved Deer Creek beyond simple space advertising to catalog sales. Once sales grew enough to make list management profitable, those revenues were invested in list brokerage, then package inserts and catalog blow-ins.
"Between list management, list brokerage and package inserts, our revenues have multiplied sixfold,'' said Deer Creek president Michael DiStephano. "We've been able to take advantage of sources of income we never could have tapped into on our own.''
Venture pools its resources through an internal referral program. When a client comes on board, a team marketing meeting is held to determine how best to meet its needs, and a message is broadcast to the company's 170 employees requesting all clients and prospects in similar fields. The company can draw from its prospect database of 75,000 companies built by a sales force of 100 across all divisions.
Incentive systems also are in place to encourage the sharing of leads. Venture's headquarters is basically a selling floor with an electronic scoreboard that tracks the day's activity. The performance of each salesperson is tracked with top sellers recognized on a regular basis.
"We have much more prospects,'' Dallas said. "What makes us a good list manager is our connection with other divisions, the way we built the company.''