Storage hardware company reaps shortened sales cycle and 32.5X ROI in first quarter from consolidation of market knowledge
SITUATION: A leading Storage Area Network company was in the midst of a transition from a sales channel model that heavily leveraged OEM partners, to one that placed much more emphasis on its growing direct sales force. However, a major hurdle existed, in the form of severely limited internal knowledge of their installed base.
As a case in point, their internal information systems contained only "ship to" data; no "sold to" data.
The company sought to build confidence in its nascent direct sales efforts by identifying opportunities in which the company had a slam dunk product, namely one that connected to the new FICON network protocol. To accomplish this, they had to identify companies that previously had purchased an older product that connected to the ESCON network protocol.
To provide a foundation for this effort, Massini Group’s client compiled historical shipment data from a number of disparate sources, numbering 26 files and over 440,000 records. Many of the records included in this initial data set were incomplete, some with only the company name included.
ASSIGNMENT: Massini Group’s assignment was to identify all of the companies that had storage devices connected to ESCON that had not yet upgraded to FICON. Company executives had pegged the program goals at $50 million in sales for the current fiscal year. The marketing team added the goal of protecting the company’s installed base, even though at the time they could not readily name the companies in that installed base.
Massini Group broke the challenge into four parts:
- Utilize internal data to identify as many end users of the ESCON product as possible;
- Supplement the limited internal data with external sources of ESCON installed base information;
- Cross reference the company list derived from the above to the contacts known within the sales force, and supplement the contact coverage with new contacts developed using outbound telemarketing to gather key contact names and confirm ESCON installations;
- Leverage the developed knowledge to jump start the sales process with as many companies as possible.
KEY STRATEGY: Massini Group developed a marketing reference database from the many disparate internal and external sources of installed base data, combined with contacts known to the sales force and extracted from their SFA tools. The marketing reference database was built by combining, cleaning and matching the various data sources to achieve a hierarchical structure in which accounts were connected to orders and sites, and sites were connected to contacts and firmographic attributes.
Using the marketing reference database as a foundation, Massini Group identified gaps in visibility and coverage within prioritized accounts and sites, and methodically closed the gaps. All tactics were constructed so as to provide operational and performance metrics that could project likely performance into the future. These leading indicators were used by marketing management to secure funding for the methodology into the future, and assure that the sales force had ample opportunities to sustain company growth.
ENGINEERED PROCESSES: Much of the "ship to" data available internally to the client consisted of drop ship points with C/O (care of) pointers to the ultimate end user. Unfortunately, the C/O data consisted almost solely of company name, with a smaller proportion providing addresses of the loading dock and other non-decision making locations within the end-user companies.
Massini Group processed a large number of order records to identify those that had usable details, then set about associating the company with business reference data that provided the headquarters location. Using this method, Massini Group painstakingly identified a few thousand companies with the targeted installed systems. Further, Massini Group also used business reference information to identify a significant number of data center sites within the corporate hierarchy of the identified companies. This number was deemed a good start, but fell short of the number of customers the client expected to address.
Massini Group supplemented the internal data with four external sources, including compiled lists and UCC filings for the devices that were acquired under lease. These sources were merged with the internal data to provide a complete picture of the installed based for the devices to be replaced.
Next, Massini Group matched all of the contacts that were known to the client’s sales force to the target sites. This amounted initially to only 19.6% of those targeted sites. The remaining 80.4% of the opportunity was understood at a site level, but the sales force did not have a contact to call. To close this gap, and to simultaneously assure that ESCON was installed at the site, and FICON was not, an outbound telemarketing campaign was launched in two phases:
- Site confirmation and contact gathering designed to locate the storage hardware decision makers at each location;
- Lead generation designed to confirm the desire to upgrade ESCON to FICON, including project formation, funding and timeframe, for delivery to the client’s sales force.
The first step, site confirmation and contact gathering, increased coverage of the target sites, i.e., at least one identified decision-maker, from 19.6% to 66.0%.
The second step, lead generation, increased visibility into the targets from 66.0% to 69.2%. Further, it resulted in 17.8% of the targets actively engaging in a sales cycle.
RESULTS: The campaign, a $400K investment, resulted in over $13 million in sales and over $45 million in sales pipeline in the first quarter of operation. Further, it produced operational and performance metrics that demonstrated the efficacy of the fundamental process:
- Identify and confirm target locations;
- Append contacts from available internal and external sources;
- Profile individuals via telephone contact to determine short term needs and medium term interest;
- Capitalize on profiled needs to drive real sales opportunities with a significantly shortened sales cycle.
Almost as importantly as the initial success, the factual support surrounding the execution of the program demonstrated to the client executive management that the process was a sustainable and scalable to drive revenue growth. The client company went on to follow-on phases of the effort that mirrored the results of the first phase.
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