The lessons shared here are an aggregation of experiences based on MarketCapture’s work with enterprise software clients, as well as conversations with executives from companies that are not current MarketCapture clients. In the interest of protecting their confidentiality, I will avoid naming some of the companies involved. 

1. Your customers (and prospects) want to hear from you (or from your competitors).
 
Time and again, I hear customers asking for more frequent communication from their enterprise software vendors.  This is a testament to the strategic importance they recognize in your software and your expertise.  The customers want to see you as a partner rather than merely a supplier.  What a great opportunity for you to establish strong, long-term relationships with these customers!  It is amazing how many companies fail to grasp this opportunity.   
 
No vacuum can exist for too long.  If you don’t fulfill your customer’s need to learn more, they will find someone else who will.  We saw an example of this recently.  The company has a dominant market share and a superior product, but has been inconsistent in its marketing presence (marketing is always the easiest thing to cut when the budget gets tight, right?).  It is now seeing how new (and larger) competitors are using the company’s very own message to make an entry into this market.  Leaving a void in the market is like holding the door open for the competition. 
 

2. Your customers want to learn, but not just about the product.
 
We do not presume to know exactly what your customers want, and therefore we encourage our clients to ask their customers for feedback at every opportunity.  Every survey conducted by our clients in 2004 (and there were a lot of them) showed that what customers want most is knowledge.  They want you to help them figure out how they can be more successful.  The surveys show that customers want more webinars, success stories, white papers, and user group meetings; Tradeshows and sales calls proved to be least desired by customers. 
 
The most successful marketing campaigns we worked on with our enterprise software clients in 2004 were those that helped customers address their business challenges.  For example, a webinar for the tooling industry featured an expert speaker on the topic of offshore competition.  The company’s product was not even mentioned during the webinar, yet it generated a large number of business opportunities and helped position the company as a thought leader and an advocate for the tooling industry.  Another webinar, targeted towards the library market, featured fellow librarians showing how to manage the growing number of digital objects entrusted to libraries these days.  This webinar did mention the product, but the focus was on the customers and how they became more successful, which always takes more than just a product. 
 
Our clients held a few successful product introduction webinars as well.  Customers are indeed interested in learning about new products, and webinars are a good way to launch new products.  But it better be really something new or the interest will die very quickly. 
 

3. Substance wins over beauty and glitz.
 
Google has already proven this point.  Not that we advocate ugliness.  As a matter of fact, our data shows that nicely designed HTML messages perform better than pure text.  However, more is not always better.  Working with a client on a recent webinar, we had an opportunity to test a creatively designed invitation produced by a leading agency against a simpler HTML invitation created by MarketCapture.  Surprisingly enough, the simpler HTML invitation generated significantly better results:

• Open Rate: “Creative” 27.9%, “Simple” 27.2%.
  As expected, the numbers are virtually identical, since sender name and subject lines were identical in both versions.
• Click Through Rate (counting all clicks on the invitation): “Creative” 0.8%, “Simple” 1.2%.
• Click Through to Registration page:
  “Creative” 0.4%, “Simple” 1.2%
• Cost per registration:
  “Creative” $2,000, “Simple” $4.

Although we have tested it in the past, these results tell me that we should go back and retest text vs. HTML invitations.  Is the simpler the better, or is there a happy medium?  We will not know until we test.  Which brings me to my next point. 
 

4. You don't know what works unless you test and measure.
 
The point of the story is not that MarketCapture created a more successful invitation.  The people who created the other invitation are talented, creative, and have a good understanding of marketing.  The results could have just the same been reversed.  The point is that we never would have known had we not measured the responses.
 
Testing is not rocket science, but it has to be done the right way.  A certain creative cannot be labeled better just because it generated better results than your previous campaign.  To accurately test the creative, all other variables must be held constant.  In our test, we used a randomly split list.  We sent out two mailings, ten days apart, and switched the lists from the first mailing to the second.  The size of the list has to be statistically significant.  My rule of thumb is that total expected responses from each list should be at least 25-30 people, preferably closer to 50.  We also used the same sender name, e-mail address, and subject line for all messages throughout the test.  The landing page was also identical. 
 
Only in such controlled environment could we come to any conclusions regarding the effectiveness of the creative.  If you have any questions about testing or would like to consult about testing strategies for your next campaign, just send me a quick note.
 

5. E-mail is still the most effective communication vehicle.
 
While finding ways to have e-mail be delivered and read continues to be a growing challenge, permission e-mail is still the most effective vehicle for ongoing communication with customers and prospects.  We are seeing open rates for e-mail communication surpassing 50%, and click-through rates that reach over 12% (of delivered e-mails) – rates you would be hard-pressed to find with any other marketing communication vehicle. 
 
Maintaining a permission-based house list is the key.  If your e-mail messages continue to offer valuable content, customers and prospects will grant you permission to e-mail them and will actually read your e-mails. In cases where we needed to augment the house list with a rental lists, the results were usually disappointing.  We achieved some reasonable results (close to 2% response rate, at a cost per response of $22) from rental lists when used to promote a webinar with a topic of broad appeal, such as in the case of the tooling industry webinar on offshore competition.  It is the combination of possessing a strong list, a worthwhile offer, and an effective creative design that makes a campaign successful.
 

6. The “new” marketing requires new skills.
 
Most of the companies we spoke to have cut back on advertising and tradeshow budgets in favor of more effective, permission-based marketing activities.  Gone are the easy days when a marketing executive could just write a big check for a couple of tradeshows and an ad that would run for six months.  Engaging customers in value-based, permission marketing activities requires a different type of investment.  Rather than spending big bucks on large events and splashy ads, they require ongoing investment in things such as content creation, webinar production, newsletter publishing, and list management. 
 
Enterprise software companies are realizing the need to retool their marketing departments to handle such tasks.  We are seeing companies invest larger portions of their budgets to hire people that can create content, execute marketing campaigns, and think in terms of lead acquisition, nurturing, and cost.  Most companies are still in the early stages of making the transition towards this new form of marketing.  It remains a question whether these companies will have the patience to see it through, especially in companies where top management is still not fully on board with this strategy.  It takes more than just good marketing to be a winner, but I truly believe that companies that do not adapt to these changes are more likely to end up on the losing side.
 

7. There is no effective PR without senior management attention.
 
Many of the marketing executives we speak with feel uneasy about the relationships with their PR agencies.  I believe much of it is a result of unrealistic expectations.  Whether you do it in-house or work with an agency, PR requires direction and management attention.  
 
It is easy to just ask the agency to draft a press release.  For the release to be effective, though, there should be clear guidance about the primary points that the press release should communicate.  Most companies neglect to provide such guidance, resulting in releases that miss the point and fail to communicate a strong message.
 
Measuring PR continues to be a challenge.  Many agencies still resist being held to measurable goals, and most companies fail to clearly define and enforce such measurements.  The agency is afraid that falling short of the goals would be interpreted as a failure on their part.  The truth is that in most cases it should be the joint responsibility of the agency and the client; without measurement, there is no accountability on either side.
 

8. After all these years, websites are still a struggle.
 
If the PR struggle is understandable to a degree, the fact that most companies are still wrestling to make their websites effective is non-excusable in my mind.  When was the last time you purchased anything of value without first checking it on the web?
 
The good news is that more enterprise software companies are beginning to understand that their websites are not just electronic brochures, but a place where they can initiate and capture customer interaction.   At the same time, many companies still fail to allocate appropriate resources to their website development and maintenance.  To do it right, you need ongoing attention of a senior marketer to guide website strategy and content development. 
 
As strange as it might sound, many enterprise software companies are behind the curve when it comes to website technology.  Rather than being database driven, most websites are still just a collection of HTML pages with some java scripting.  As a result, websites are often outdated, pages and forms are malfunctioning, and simple tasks become weeks-long projects. 
 
I could fill pages with stories of malfunctioning websites.  In one case, I notified the webmaster of an enterprise software company of a malfunctioning link, but when I visited the site six months later, it was still not fixed.  It is not just a small company problem.  During the month of December, Security software company Trend Micro ran an ad in Newsweek that directed consumers to a non-working url (it has been fixed since).  And Yahoo!’s holiday “Do Good” promotion e-mail sent people to a landing page with broken links. 
 
These technical issues demonstrate lack of attention.  Your website is your most important marketing asset.  Make sure it conveys the right message and provides visitors with opportunities not only to find information, but also to let you know their interests and give you some valuable feedback.
 

9. Marketing and sales collaboration: work in progress.
 
Like it or not, neither sales nor marketing can succeed without the other.  Most companies continue to struggle to define an effective process for generating leads and moving them into the sales pipeline. 
 
At the same time, I am happy to report that I am seeing progress.  In most cases, the driving force is a senior executive that takes the bull by the horn and dictates how marketing and sales should work together.  In all of these cases, the process is not perfect, but is a step in the right direction.  Marketing and sales do not always embrace the change with open arms, but usually the results speak for themselves: more leads are converted to opportunities, revenues go up, and everybody is happier.  The XOsoft story is one example for such success.

What lessons have you learned in 2004?  I would be happy to include these in the next issue.