Publicly Available Pricing: Theory and Practice

A lot of what I write on this blog has to do with the changes that have happened as a result of buyers’ increasing access to information. Often, these changes are looked at from a general perspective. Today, I want to look a very specific example of how this overall market transition affected us at Eloqua. It’s a very representative, specific, example of what’s going on in the market in general.

Last week we made the pricing for Eloqua’s software product packages public on our website for the first time:

The starting prices range from $1450 to $10,000 per month, depending on the level selected.

Just hearing this likely makes everyone who has ever been a field sales rep cringe. Won’t this blow up deals? What if an Enterprise buyer hears of an SMB buyer making a purchase at 1/10th the price? Won’t you be excluded from deals based on the price being seen as too high (or too low)?

Unfortunately, these arguments are based on an incorrect assumption that without talking to our sales team, buyers will not have the ability to form these perceptions of our price. That assumption, however, is false. Now, buyers are able to gather information, form opinions, and come to conclusions without ever talking to a salesperson. The sales team is competing with Google as a source for information, and that is not an easy battle to win.

So, with the market transmitting information very efficiently, the question for us was not whether the market should have access to opinions on our pricing – they already had formed opinions. The question was whether those perceptions could be better guided by contributing accurate information to the conversation.

In our case, the breadth of organizations we served had led to a perception in the SMB market that we were significantly more expensive than we actually were. So, we were better off to correct that data point in the market, rather than allow mis-perceptions to be the guiding data point, as that could easily lead to not being considered in a deal at all if the perception was significantly different than reality.

As with any change of this type, agreeing on the theory of what is happening in the market is much easier than the tactical implementation of the changes that are needed. There was much debate internally, and many points of view were raised. However, the feedback has been overwhelmingly positive, and even in the short time it has been public a number of conversations have started with buyers who had held misperceptions of price.

Are there any changes like this that your organization is considering that are easier to agree to in theory than in practice? Will you move forward with them?

Google, Display Ads, and B2B Marketing

Google just pushed a tiny bit further into their long-stated strategy of making display advertising their next billion dollar business. Former DoubleClick exec Barry Salzman joined the team to bring this vision closer to reality, and it’s expected that we’ll see more movement from Google in this direction over the next year.

What does this strategy mean for B2B marketers? A lot.

As B2B marketers, we love search, both natural, and paid, as it gives us a highly precise way of targeting buyers based on a real-time understanding of their interests. If someone searches for “demand generation”, we can reasonably assume, that at that moment in time, they are quite interested in learning about “demand generation”. Targeting our messages against a profile that accurate makes sense in an environment where we are selling products that are often complex, expensive, and highly considered, to a very narrow audience of business people who are interested.

The Flaw With Search

The problem with this is that it relies on the prospect to "actively" seek information. They need to make the effort to perform a search for a specific piece of information, and when they do, we are able to present them with a message. This works well, but only in situations where they are actively searching for a specific type of information. Outside of that, we have no way to reach them. This means that any messages we would like them to discover more “passively” in order to start them thinking about new areas that their business could be improved, change their perceptions of a certain solution, or highlight an area to consider that they may not have considered, we are unable to get that message in front of them.

This active/passive challenge for marketers is about to move to the fore-front as Google brings its weight into the display search game. With its heavy investments in social media, with the new Buzz platform, and the full Twitter feed, as well as the algorithms to understand these in real time, Google is in an enviable position. This data allows Google to begin to understand who is interested in what at any given moment, and who the influencers are in that particular market.

Intention-Based Advertising

Far more than the loose, mainly demographic-based, targeting that is currently available to marketers in display search, Google will conceivably be able to present display ads based on actual area of interest and intent (acting more in the role of information concierge). Much as we currently target search ads based on the key phrase typed, we may soon be able to target display ads based on key phrases that are not typed – just acted on. As prospective buyers show an interest in investigating a certain area, say by clicking on a link, shared socially, that refers to an article on generating more leads for sales, Google may be able to then show them a display Ad targeted at any interest in “demand generation”.

Right now it is difficult to target prospective B2B buyers “passively”, so much of our marketing efforts are designed around making it easier for prospective buyers to find us when they are actively looking.
This may soon change.

Cash Flow Statement as a Metaphor: Sources and Uses of Leads

Earlier, we introduced the financial metaphors for balance sheet and income statement when looking at B2B marketing analysis. Following on the same financial metaphor, a “cash flow” statement can show valuable insights into the sources and uses of leads, allowing you to dashboard the lead flow within your organization in order to understand which territories, product lines, or business segments are seeing more lead flow than others, and whether the leads are being successfully converted into opportunities.

Understanding which sales teams are seeing the best sourcing of leads gives a good sense of whether there is any imbalance in the lead flows. For example, in the following data, you can see that although the West is generally getting more leads, they are of significantly lower quality. Similarly, while there are lots of leads for Widget B being generated, there is a significant imbalance in lead flow to reps in the East.





With this understanding of which territories, product lines, and salespeople are provided with leads, the next step is to provide insight into the outcome of those leads once they have been handed off to sales. Done properly, the disposition of leads by a sales team after they attempt to connect with them should not only trigger a marketing process to correctly handle the leads, but also provide clear insights into the quality of the leads. If the leads were unreachable, lacked interest, were not the right role, or only had early stage interest, this insight allows marketing to see whether there are potential quality issues with their leads.

Likewise, if certain sales reps are doing a poor job in following up with the leads they are given, this will also show up in the analytics of lead disposition. In the following lead disposition chart, for example, you can see that both Bob Clark and Jane Chen received a large number of leads, but failed to convert many of them to opportunities, instead resorting to voicemails or calling back in 90 days. This may be an indication of a performance or training challenge with these two sales reps.



The more visibility we introduce to our processes for building interest, qualifying leads, handing them to sales, and having sales connect in order to grow a revenue opportunity, the better we are able to improve those processes. The cash flow statement, as a metaphor, provides a great way to look at which sales teams are getting good sources of leads, and what the uses of those leads are. The ability to optimize this lead flow or guide the sales team's response lets us optimize revenue quickly and effectively.

Passive Discovery vs Active Discovery

In looking at the messaging architecture you put together for each buyer role and how they progress through their buying process, it’s important to think through how the message you need to get to the buyers will be discovered. Some will be "actively discovered", and some will be "passively discovered". It is crucial to understand the difference as it guides what strategy we need to take as marketers.

Active Discovery

Many of the marketing messages you want to be found by buyers will be found by the buyer explicitly taking an action (ie a Google Search) to seek out the information. This is the metaphor we think of for clearly defined information, such as feature capabilities, that are looked for specifically by name.

Here, the challenge is quite clearly defined; a buyer is actively seeking a piece of information, usually with search, although perhaps in community discussions or on social bookmarking sites. As a marketer, you need to ensure that your message is present, and in a way that makes it easy for the buyer to find it on a search engine. Although the art and science of search marketing is sufficiently challenging to warrant the creation of an entire industry, the problem being solved is quite clearly defined.

Passive Discovery

This is not the case, however, for more passive messages that need to find their way to potential buyers. Passive messages are messages that would not be actively sought by potential buyer, such as messages that alter pre-conceived notions of reliability, applicability of a solution to a certain industry, and perceptions of product usability, service quality, or price-point.

These messages, as they are not actively sought, must be built into other stories that can be discovered, or carefully presented by an "Information Concierge". for example, a pre-conceived notion of the applicability of a solution to a certain industry can be shifted by seeing that solution mentioned as a key part of a client success story. A sense that prices are higher than they actually are can be adjusted by sharing stories that relate to smaller or cost-conscious businesses. A perception of user challenges can be changed by stories that mention a large, vibrant, and happy user community.

Story-Telling and Passive Discovery

The use of the idea of stories is deliberate. There is no more effective way of conveying a passive message, such as a change in perceptions, than through a story that is shared by one peer to another. Word of mouth messaging is the most effective way of changing perceptions because it comes from trusted peers, and cannot effectively be bought or biased by marketing budgets.

However, marketers looking to change perceptions, introduce ideas, and challenge pre-conceived notions, must introduce stories that are easily told. These are not the dry, ROI-driven, case studies that celebrate and trumpet our showcase clients, but are stories that entertain, inspire, or challenge their audiences. There is no reason that we must avoid the idea of having fun with B2B marketing campaigns.

Marketers, especially B2B marketers, who are effective at finding and packaging the truly interesting stories that tend to get shared via word of mouth have an opportunity to subtly focus on certain messages or perceptions that they need to change in the market.

The Buzz about Google Buzz – 6 things relevant to B2B

Yesterday, Google announced their next major foray into social media, with the launch of Google Buzz. While the main concepts behind Buzz are very familiar with anyone who is at all familiar with social media – friends, status updates, photo sharing – the way that Google brings it all together, and their sheer weigh in the market, means that this may be quite interesting.

As a B2B marketer, what does this mean?

It’s always challenging to gaze into the proverbial crystal ball, and in a market this dynamic, many things can change, but here are 6 things worth paying close attention to as Google Buzz rolls out:

1) Shift to the Main Stream:

Historically, social media has been somewhat separate from other parts of our world. You had to deliberately set up a new social service, whether Twitter or Facebook, and then actively make it part of your daily routine. It actually took an effort (albeit small) to get involve. This meant that social media was less adopted by the business mainstream, but was mostly adopted by the writers and bloggers within a business context. Therefore, social media as a marketing strategy in B2B was often used to influence influencers, rather than connecting directly with end prospects.

Now, Google has integrated all of the elements of social media much more tightly together – your email contacts automatically are your friends/followers, Buzz updates are right next to your Inbox, and a message blurs the boundary between an email and direct message. This means that, rather quickly, a significantly higher percentage of the mainstream audience will find themselves involved – actively or passively – in social media.


2) Reducing Business/Personal Boundaries:
With this steady integration of email, status updates, photos, and friends into one realm, it continues the trend of blurring the boundaries between business and social relationships, and between work and home life. Whereas I do believe that, in many ways, our brains are hard wired to see a clear difference (hence why it would feel extremely awkward to offer to pay your mother-in-law for Thanksgiving dinner), I do see the evolution of Google Buzz as reducing those boundaries.

What this means for B2B Marketers is that your buyers will have more personal stakes on the table when they get involved with your organization. Regardless of whether you are the cheapest or best, the encroachment of business on personal space will mean that strong emotional factors will be at play. If you are not a company with whom they feel a level of trust, a personal relationship, and a pride about doing business with, you may not be selected. Intangible factors, to be sure, but personal space is more about emotional factors than rational business decisions.


3) Small Groups, Waves, and Influence:
Google appears to be adding a focus on the “small group” that is less emphasized in many current social platforms. By adding an interim step between one-to-one and one-to-world, and providing a new way for these groups to interact (and be observed) online with Google Wave, they now have a much richer ability to understand how influence manifests itself in small groups.

This shift from large influencers to many smaller influencers is a key dynamic in today’s world, and by focusing on the small groups, Google has positioned themselves to be a key part of it.


4) Location-Based Social Connections Increase in Importance:
With a tight tie to the iPhone, and its location-based features, Google Buzz has moved location-based thinking one step closer to prominence in today’s market. Buzz has many features that are tied to both where you are, and more importantly, who is near you. With a human, face-to-face relationship still being highly relevant in building trust, these location-based features may increase the importance of classic off-line events like major shows and conferences.

Rather than being about the content, events will continue to shift towards being about who is there, and how to orchestrate face-to-face meetings. Location-based social networks will be one of the most powerful contributors to this shift in the dynamic of off-line events.


5) Google Knows the Influencers:

One of the most powerful insights that Google gains is knowledge of who the actual influencers are in any given market. Seeing exactly who is followed, what topics are discussed in small groups (and with whom), and what links are clicked on in shared status updates, gives Google tremendous insights into who is interesting and relevant in any given topic area.

This understanding of influence by subject is not just a powerful data set, but as Google progresses further into real-time search, the ability to rank a result highly because a key influencer on that topic area suggested it will allow much more accurate search results. For those B2B marketers still focused exclusively on content and links as a driver of search ranking, this will be a trend to pay attention to.


6) Google Knows Your Interests:

Conversely, Google will also begin to build an understanding of each person’s interests based on their friends, the topics of their discussions, and what they share and respond to. As Google does this, they will be able to move from only being able to present relevant information when it is actively sought (via search), to presenting information that is passively sought (through general indications of interest). A “recommended” posts concept will allow Google to continually tune these algorithms.

This is a powerful transformation for B2B marketers, as many of the ideas and concepts we need to communicate and have buyers discover are not always actively sought. Being able to present a message to someone who displays certain indicators of intent, but may not have explicitly searched, is a powerful arrow in the B2B marketer’s quiver.



How Google Buzz truly ends up effecting us as B2B marketers is obviously determined by many factors. However, Google is clearly a major player in the market for finding and discovering information, and as they make a major new foray into social media with Buzz, these six trends are well worth watching.

What do you think? What will your organization be watching for as Google Buzz rolls out?

Calculating the True Cost of an Email Campaign

Since the advent of email marketing in the mid-1990s, companies have embraced the misconception that email is virtually “free” as a marketing medium. This false impression often leads to over-communication, which, in turn, triggers diminished response rates, spam complaints, and unsubscribes. Even marketers who are sensitive to email recklessness sometimes face internal pressures, such as of year revenue numbers, to send “one last blast to the entire database” with the justification that “it doesn’t cost us anything.”

So what is the true cost of an email campaign?

To understand true cost, you need to first understand your marketing database a little better. The names within it are not all equally engaged, and your actions affect this level of engagement.

Net New Names

At one end of the spectrum are the names entering your database. As a marketing team, you work hard to populate your database -- attending shows and events, putting on webinars, publishing research, and investing in paid and natural search. As these efforts succeed, new names will enter your marketing database. By understanding the investment it takes to create these marketing programs, and then dividing that total cost by the number of net new names in your database, you can calculate a Cost per Net New Name. For the sake of this discussion, let’s assume that cost is $10.

Emotional Unsubscribes

At the other end of the spectrum are the people who are disengaging from your messaging. The reality is that many marketers only measure actual unsubscribes – those who clicked on the unsubscribe link – as their measure of disengagement. However, this limited measure fails to fully account for the way in which most email recipients disengage. Most recipients reflexively ignore or delete unwanted messages, rather than clicking on an unsubscribe link. At this point, they have “emotionally unsubscribed,” and are not paying attention to your messages.

To identify people who have “emotionally unsubscribed,” you need to measure whether they have engaged at all – email opens, clicks, or website visits – in the past three or four months. If not, it is likely that they have disconnected from your communications.

The Path to Disengagement

Between these two ends of the spectrum is what you, as a marketer, control. Irrelevant messaging, poorly targeted content, and thinly disguised sales pitches will quickly drive your audience away. To understand how it takes for your prospects to disengage, you must analyze your email marketing history. Look at the number of “ignored” emails between any two “non-ignored” emails. If you look at a “reasonable maximum” for this number – say the 80th percentile – you can see how long it takes a person to disengage. For example, if only 20% of your audience ever re-engages after they have ignored 20 emails in a row, your Disengagement Path is 20 emails. Let’s use this figure for our example.

Calculating a Real Cost

Now, with these two values, you have a way to calculate the true cost of an email campaign. People who disengage must be replaced with net new names, or your overall effective marketing database shrinks. So, for an email campaign that is sent to 100,000 people, of which 40,000 open it, we have 60,000 who did not engage in any way.

The cost of this campaign is found by dividing those 60,000 by the Disengagement Path of 20. This email campaign can be said to have pushed the disengagement of 3,000 people.

At $10 per name, this loss of 3,000 people has a true cost of $30,000. Not an insignificant cost for an email marketing campaign at all.



If thought about in this way, which is much more accurate than just the hard costs of the email send itself, we would all make significantly better email marketing decisions as we would be guided by a much more accurate view of the economics.


(This article was originally published as a guest post on MediaPost)

Deep Searches and Content Proliferation

Sometimes, the evolution of what is available online and how buyers access it tends to form a bit of a positive feedback loop that rapidly changes behaviours, and therefore what marketers need to do.

Take, for example, search. Today’s buyers are rapidly becoming accustomed to the prevalence of valuable information online, and the increasing accuracy of search engines. In response to this, buyers are beginning to adapt how they perform searches, and are seeking ever more precise and deep information. As the effect of social influence on search results increases, this trend will only increase as deep content, of a quality determined by the social influence of specific experts in that topic area, can be even more easily discovered.

What this means is that buyers are not searching for broad topic areas as one might flip to a section of a newspaper. Instead, prospective buyers are using longer and longer terms find exactly the information they need. According to a Hitwise study on search phrases over 56% of searches involve three or more words in the search phrase, while close to 20% involve at least 5 words. This is a significant fact as it means that prospective buyers are seeking information that fits a very specific challenge they are facing or precise question that they have.

To keep on top of trends, buyers might search for how specific new capabilities are affecting their industry (“augmented reality in real estate”) or trends in businesses like theirs (“small business adoption of CRM”). As they move towards a purchase cycle, and look for particular vendors to have on their evaluation list, prospective buyers may seek particular traits (“funds making ethical investments in latin america”) or specialized capabilities (“high availability network backup solutions”). Similarly, when moving towards the final stages of validation of a purchase decision, the searches may involve specific brands or product names, along with capabilities, objections, or perspectives that the buyer is looking to learn more about (“Eloqua email deliverability specifications” or “Eloqua marketing automation in financial services”).

Over 56% of searches involve three or more words in the search phrase, while close to 20% involve at least 5 words.

The Challenge for Marketers

The resulting challenge for marketers is an interesting one. If searches are becoming more precise, this means that we must strive to both create a wealth of quality content that is interesting and relevant at all phases of the buying process. Similarly, as search results are being guided by social influence, we must strive to build influence and reputation among the appropriate audiences so that our results are found to be relevant.

As we do this, it is key to keep a close eye on both our search discoverability and the search terms that currently drive visitors to our sites. If we watch these metrics, while at the same time increasing our focus on creating deep, high-quality, subject-matter expert content, we will be found by those buyers and have a chance to influence their thinking at each stage of the buying process.

Evaluating Marketing Automation - Data Management

Continuing on a theme that received great feedback, I wanted to provide another real, down in the details, way to evaluate the various claims in the marketing automation field. Last time we looked a way to ensure that a provider could have the performance needed for your marketing goals - a quick and simple upload that will test actual marketing automation system performance.

In this post, it's worth taking it one step further. Getting marketing data into a platform is one thing, but if the data is messy (and what marketing data isn't), it will not be of much use. If, for example, your marketing database has 100,000 names in it, and the titles are just as they were written, such as:

• VP Marketing
• V.P. Mktg
• Vice Pres Marketing
• Marketing Vice President
• Mktg VP

and you are asked to build a list of Vice Presidents of Marketing to target, how many will you find? 300? 800? We've seen many situations where dirty data returned 300 names, but the same query against cleansed data returned 17,000 names. Proper management of data makes a huge difference in your marketing results.

So, how do you test for this when considering a marketing automation software investment?

Quite simply - ask, in a demo, for each vendor you are considering to run a quick test. Here is a sample CSV file with typical marketing data. Titles, states, and countries are as they would be in a normal marketing or CRM database. The data is kept simple, and the titles are mostly in sales, marketing, and finance, while the addresses are in Canada, US, and UK.

Have each vendor run the following test for you:

• Upload the sample file
• Clean up the country fields so that US, USA, U.S.A, as well as the variations of Canada, and England/UK are normalized
• Clean up the "raw" job title fields to two new fields for "level" (VP, Director, etc), and "role" (marketing, finance, etc) so you can properly segment
• As a bonus, see if they can correct the missing leading "0" on New England zip codes - removed by Excel in many marketers' data files

When it is uploaded and cleansed check the data to see the following:

• The only countries in the file are "USA", "GBR" and "CAN" or however you chose to normalize the country data
• The people can easily be filtered by role into "Marketing", "Sales", or "Finance"
• The people can easily be filtered by level into "SVP", "VP", "Director", or "Manager"

Many marketing challenges come from bad data. An inability to do proper segmentation, personalization, lead scoring, or analytics can quickly result if you are not able to standardize and normalize the data in your marketing database. To avoid getting into this situation, it's worth having the marketing automation provider you are thinking of choosing run through this quick test with real sample data.