Building Your Contact Database

Demand generation starts with your contact database. Most companies have already messed up their contact database to the point where it will be a lot easier - and more effective - to re-build the contact database from scratch. In this post, I will explain how your contact database gets messed up and what to do about it.

In B2B enterprise marketing, your target universe is finite and very well defined. Unlike consumer marketing, you do not start off with a gigantic number of prospects and narrow your way down to a smaller segment or subsegment, which also happens to be a gigantic number. The dynamic is quite different in B2B demand generation. You are already dealing with a small universe of prospects. You should manage it carefully from the start. Hence, you want to build a contact database a single entry at a time until you reach the maximum number.

To illustrate, let us think about a security appliance vendor that is trying to sell to the large U.S. enterprise segment. The U.S. government defines the enterprise segment as those entities employing over 1,000 employees. There are approximately 10,000 of these companies. Assuming you will need to reach a minimum of five contacts within those organizations, this translates to a universe of 50,000 contacts. If you go down a level below the large enterprise, there are about 30,000 more companies in the U.S. with 500-1,000 employees.

The next step is to research and segment these 40,000 organizations to get the number down to a more relevant and manageable number.  Tools like DiscoverOrg are a great resource to get more data on the companies. There are dozens of similar services but I have used DiscoverOrg in at least four different companies and its database of close to half a million contacts is rock solid.

This is the point at where things breakdown. Many sales and marketing team try to pour 200,000 contacts into a database and then hammer them relentlessly with meeting solicitations. This is not what a startup should do. It bears repeating. You should not build your company’s contact database from the top down. Think of how you would approach training a new sales hire to go about doing her job. You would never tell her to blast 200,000 people.

At one very small startup, we were able to build up to a target contact database of just a couple hundred prospects. We had a total of 8,000 contacts in our system but we identified and placed 200-250 of the best contacts in a separate track. We felt these could genuinely be considered leads in both how they were acquired as well as on how we had developed them.

So, how did we capture these new contacts? Mainly, we secured these 200-250 real leads three ways. First, we ran some paid campaigns just like many other companies do. There is no way around it. The volume levels for B2B campaigns are woefully low compared to our consumer counterparts but they are still opt-in leads you can approach without worrying too much about negative repercussions.

Second, we sent targeted emails to a small subset of our total contact universe. We reached out and invited them to a seminar we were hosting at a venue nearby. Since this is a group who had not explicitly given us permission to contact them, we composed our copy very carefully to let them know that we had researched them well, and if we reached them in error, we would greatly appreciate their assistance in re-routing our invitation to the right person. You would be surprised by how helpful complete strangers can be if they are approached by thoughtful folks.

If we did not succeed in getting enough people to sign-up for a seminar in a particular area, we used a third approach. We followed up and told them the event was cancelled or postponed but used that as an opportunity to enrol them in our early adopter program (aka, mailing list). Upwards of a quarter of them signed up in most regions.

From this point on, you can keep layering on more and more contacts from a wider array of sources.

If the simple steps described above can get you on a path toward dramatic improvements in the number of high quality sales opportunities, why is it so hard for startups to execute?

Because it flies in the face of conventional wisdom and requires a mindset shift or overhaul. We tend to view top-of-funnel activities as a scale or fail game. Pour 10,000 leads into the funnel and it will eventually spit out 100 opportunities at the bottom of the funnel. At scale, perhaps that is the only way. But, not in the run up as you are building it.

I deliberately try to avoid the use of the term “lead database.” A contact that is developed becomes a lead. A lead that is developed becomes an opportunity. An opportunity that is developed becomes a commit.The key word is “development.” What are you doing to develop it to advance it to the next stage?

In the beginning, it is far better to focus on developing 100 contacts than it is to develop 1,000 of them. Your objective as a marketer is not to get the highest volume of qualified leads. Your real (and only) objective is to produce a lot of high quality appointments for the outside sales organization.