Cost-effective customer acquisition top issue for BTB catalogers: study

Acquiring new customers cost-effectively to grow business was the leading concern of many business-to-business catalogers, according to a new survey conducted by list services company MeritDirect and Web site designer and operator DMinSite.

Ninety-one percent of those responding to the 2007 Anonymous Survey of B2B Business Conditions ranked that issue as No. 1. The new postal rates for Standard Mail flats was cited by 73 percent, having reliable performance metrics by 60 percent and finding new ways to grow business profitably by 51 percent.

“Overall, in general, the greatest challenge multichannel marketers have is overwhelmingly related to adding customers cost-effectively and a lot of that is exacerbated by the postal rate increases,” said Ralph Drybrough, CEO of MeritDirect, White Plains, NY.

MeritDirect and DMinSite sent the survey to 168 CEOs, presidents, owners, general managers and C-level marketing executives of MeritDirect client companies in the BTB cataloging space. Forty-four responses were received by the May 11 cutoff date.

Another major concern unearthed by the survey was recruiting enough talented people to keep up with the BTB cataloger’s growth.

“The BTB people traditionally have been the corner of the catalog industry,” Mr. Drybrough said. “By far the largest in the industry is consumer catalogs and, anecdotally, we believe that consumer catalogers pay more money. So you’re competing with these pay standards that exist.

“In order to have the quality personnel to achieve the objectives of growing profitably, you need quality people,” he said.

A round of questions on comparables yielded interested answers. Fifty-nine percent of those responding said sales for the first four months of 2007 were up and 14 percent said the sales were comparable.

In another response, 76 percent of the respondents said their full-year sales forecast for 2007 was up, and 12 percent said it was comparable to last year.

Also, 76 percent expected the 2008 forecast to be higher, while 16 percent expected similar results.

Finally, 61 percent said their budget for Internet-related marketing versus postal catalog marketing will be up, with 33 percent expecting about the same as last year.

The finding on the first four months’ sales expectation is what caught Mr. Drybrough’s eye.

“After four months people are still not ready to adjust their forecasts for the year,” he said. “There is an amount of optimism for the rest of the year and one of the reasons for that is that the last half of the year typically accounts for 55 to 60 percent of the revenues for many of these companies.”

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