Indiscriminate, one-size-fits-all marketing is expensive and can even irritate customers. Apart from companies providing mass-consumption products, all businesses can achieve better efficiency and results by tailoring their market campaigns according to the specific profiles of their target customers. A company in the medical device sector was able to save money by optimizing its direct marketing campaign thanks to its recent implementation of a geomarketing approach.
Wilfried Bornemann pulls up to the post office in his station wagon at 10:30 am. The yellow mail containers he hauls out of his car contain 10,000 letters. Bornemann is counting on these mail-ings to generate much-needed turnover. A half hour later he's back in his car with a receipt for over € 2,500 in his hand – the postage charge for his 10,000 letters. He feels a little uneasy when he reflects that this is already the third mailing for this year, with more to come.
Bornemann is the CEO of a company that sells analytical equipment to doctors' offices. His business has expand-ed over the past two years to seven employes. Despite this success, he faces significant competition. Sale of his products has been lagging despite the fact that they offer genuine innovation and facilitate the more effective organization of doctors' workflows. His devices retail at € 4,800 apiece.
After returning to his office, Bornemann pours himself a cup of coffee and reflects. His regular mailings to doctors' offices are a significant drain on his finances. He and his colleagues have just invested a lot of time in planning for the future. Will it produce positive results? He nervously taps his pen on his desk.
At the same time Grit Steiner is also in a contemplative mood. She joined Bornemann's team three months ago and is responsible for overseeing incoming orders. The most recent mailing response rate was a very modest 1.5 percent. Also, the external sales team only visited several new customers due to the significant travel time involved. She worries that the most recent mailing will turn out the same. It seems clear that the company's approach to securing new customers is not having the desired effect. Grit reaches for her phone and arranges a meeting with Bornemann.
The next morning they‘re sitting in Bornemann's office and working through their colleagues' files and print-outs. Bornemann soon feels stressed by the endless tables and columns. "Where is Mr. Gral driving to all day?" he suddenly blurts out, clearly tense.
As part of these preparations, Ms. Steiner has drawn sketches on numerous maps of the active area in Cologne. Steiner and Bornemann asked Till Gral, the head of the Cologne office, for some concrete details about his experience in this sales territory.
"We need to select our potential customers more quickly and proactively," says Gral. "So how do we do this?" asks Bornemann somewhat critically. "Geographically and according to accessibility," says Ms. Steiner in confident tone. "What's the point of mailing letters to locations outside of our key service area?" "Exactly!" adds Gral. "I have to be able to quickly reach my customers by car."
All of this was six months ago. Today Wilfried Bornemann reflects back on that stressful afternoon with a sense of levity. "This was the true turning point for us," he explains. His most recent mailing was carried out with the geomarketing software RegioGraph, which he used to import his extensive list of customer addresses. A few clicks later, he was able to see how many of these customers were located within a 30-minute drive of Till Gral's office in Cologne. This greater precision and selectivity dramatically reduced the postage of his mailings. Thanks to the improved organization made possible by RegioGraph, Bornemann's team has also been able to better serve potential customers, leading to increases in turnover. In short, RegioGraph paid dividends very soon after its implementation.
Each sales force member now receives a map of his or her sales territory and its potential. This clarity motivates the new employees. The number of mailings has increased to 40,000 as a result of new business locations, but now Bornemann only focuses on the areas with the highest potential. Response rates have improved as a result of optimizing the mailing campaigns according to driving time. Of the contacted doctors, 2.3 percent responded with a request for a personal consultation – a clear improvement over the previous mailing.
Grit Steiner has become the company's RegioGraph expert and regularly evaluates responses, turnover results and customer visits according to geographic criteria. "This approach has brought an enormous degree of transparency to our sales effects," she explains. "Previously we didn't do success controlling, but now thanks to RegioGraph we can easily keep track of our results and know where we stand."
And those annoying tables and columns? Bornemann smiles: "They still exist, but they're much more manageable through their incorporation into RegioGraph."