Iterate or Die – Part 4

After we had built an award-winning product and accrued several years of domain experience, we embarked on the next major iteration of the business: sales and marketing. I knew the technology aspects of my business inside and out, but my knowledge of B2B sales and marketing left much to be desired. After a bit of Googling, I decided to focus on three strategies:

• Cold calling
• Partnerships
• Pay-per-click ads

Cold Calling

The first idea for cold calling was to buy a list of all the Chief Information Officers  in the Southeast with revenues between $100 million and $1 billion, a grouping often referred to as mid-sized companies.  We targeted the Southeast because we figured we would have the most success if we could meet with our prospects face to face. That’s another benefit of being based in Atlanta — as a regional transport hub, you are within reach of many other large regional cities, not to mention connected to a multitude of flight routes from the world’s busiest airport.

Once we had a list of target prospects, we hired a slew of interns from nearby Emory University to cold call 1,000 organizations. The end result?  A measly four appointments. Our cold calling efforts, while valiant, suffered from a lack of the following:

• Compelling value proposition
• Referenceable customers we could name-drop
• Product or company name recognition in the market

Cold calling would eventually become one of our most effective strategies, but it took us a solid year to determine where we should focus our efforts.

Partnerships

I’d long assumed that finding implementation partners and resellers was a logical strategy to build my business. Potential partners, such as interactive agencies and ISVs, would provide the services and we’d provide the product. It would be an ideal win-win situation.

Unfortunately, it never brought the results we’d envisioned.

We continually worked over the course of several years to forge partnerships with ten companies. Those ten partnerships together resulted in just five total sales. That’s right — very few partners would officially sign on, and even fewer relationships resulted in actual revenue gains. It took me a long time to understand that introducing a mid-market CMS to a client would in turn reduce the amount of money that agency could bill for fees.

Agencies operate in a time and materials model, and tens of thousands of dollars in CMS costs would come right out of the same client budget as hourly fees. From the agency’s perspective, building a custom client solution, even if it cost more and accomplished less than an off-the-shelf CMS, was the right thing to do for their business model. It was a hard lesson to learn.

Pay-Per-Click Ads

Pay-per-click (PPC) ads are the sponsored ads that show up alongside search results in Google and other search engines. When we did our first PPC campaign in late 2003, it was much more affordable and cost-effective compared to today. Quite by accident and much to our delight, PPC ads, combined with landing pages, generated leads in a variety of industries. After reviewing these leads, we methodically followed up on the promising ones and began moving prospects through the sales process. By the end of 2004, we had signed clients representing each of the following verticals:

• Management consulting (1, from cold call)
• Healthcare (1, from cold call)
• Utilities (1, from partner)
• Hospitality (1, from partner)
• Technology (1, from PPC)
• Higher education (2, from PPC)

Head on over to Iterate or Die – Part 5 to find out what single industry we had slightly more success with and how we focused on that industry to become a market leader.