Quantum Leap in Quality
Quantum, Snap Division
Develops and manufactures network-attached storage solutions
Three-week design and implementation phase, beginning April 1999
Bart Bartlett, OEM marketing manager; Lori Lyons, e-marketing manager; Greg Swope, vice president of sales; Steve Sherman, director of customer support
Hard-drive giant Quantum's Snap Division, which makes stand-alone network storage solutions, is pioneer of Web-based marketing. It has a Web banner presence that runs as high as 10 million impressions per month, on a wide variety of general-interest, high-traffic Web sites. Surfers are lured to enter into a weekly contest to win their very own, easy-to-install Snap! Server by clicking the banner and filling out a simple form-and that innocent form, of course, is actually just the cusp of an aggressive marketing campaign.
The contest pitch does its job, and generates a large pool of potential leads. From these leads, this division is expected to ultimately generate $30 million in revenues this year. Such numbers suggest an efficient lead acquisition process, but that wasn't really the case. Quantum's tactics for turning countless contest entries into solid, A-list leads for the sales organization weren't working. Quantum knew what characteristics would make for a good Snap! Server customer, but conventional methods for extracting that information were falling short of the mark in accuracy, speed and affordability.
"We ended up with children off school buses qualifying themselves," says Bart Bartlett, formerly OEM marketing manager for Snap Division. "We ended up trying to simplify our qualification process as much as possible to meet [the telemarketing organization's] ability to implement." In essence, Quantum "dumbed-down" its qualification process, resulting in rampant inefficiencies.
Bartlett got serious about finding a solution to the problem, and he found MarketFirst Software, a Mountain View, Calif.-based marketing automation vendor. He worked with MarketFirst's consultants to design a "multi-step, interactive process" to accurately extract ready-to-buy customers from a large pool of contest entries. The design process was relatively painless, because Quantum had a solid notion of what made a good customer-they just couldn't make the old telesales organization work well enough to retrieve it. "They knew what they wanted to ask," says Renee D'Ouville, director of marketing consulting for MarketFirst.
For Quantum, the MarketFirst solution filled a painful gap in its marketing process. For the first time, the qualification mechanism is equal to the number and diversity of potential customers collected through online marketing.
Weeding the Leads
That qualification mechanism begins with an initial banner click. This leads to a Web form that collects basic contact information and asks just a few additional questions about whether the customer is an end-user or a VAR, whether they have network storage needs, and how they would prefer receiving additional product information: via e-mail, fax or post. Keeping the initial contact short and to the point is crucial, because it's subtle. "You only need to capture the information necessary for your next interaction. If you ask for too much info, it's a barrier to response," says Russ Henry, vice president of marketing for MarketFirst. "You're building a trust relationship, so you don't want to say `Hi, it's nice to meet you. Do you have any budget?'"
Quantum's lead-acquisition process is based on that minimalist principle. All contest entrants are sent a "thank you" e-mail, which, if they are an end-user in need of network storage, invites them to share more information with the automated e-mail system. The questions gradually become more and more specific, but with the overall goal of remaining conversational. In their experience, the somewhat lengthy qualification process is not a deterrent to the truly interested consumers. It helps eliminate low-quality prospects from the system. "We've giving them lots of opportunities to disqualify themselves," says Bartlett.
Ultimately, leads can choose to be directed on to a reseller, or can be pointed at one of the major Snap! Server catalog vendors. If they prefer resellers, MarketFirst automatically parcels out the lead in e-mail form to a Quantum Snap partner based on ZIP code. In the coming months, MarketFirst will roll out a Web-based client for the sales force to allow advanced tracking of open leads, and Quantum plans to integrate the leads with their own SFA software as well.
MarketFirst provides the hosting and back-end for the client database and automated e-mail engine, and the system is built for speed. "If they respond to our e-mail immediately, they can go from being a Web banner click to a distributed lead in about five minutes," says Bartlett.
Success is a Snap
Bartlett believes the relatively simple sales cycle for Snap! Servers contributed to the success of the project. "We didn't need to track eight or nine sales calls," he says. "That's why a lot of the functionality offered by conventional SFA wasn't a good fit." As for cutting the human touch out of the qualification process, he believes that there are actually some real gains for the consumer. "It reduces the human touch, but we're providing a more personalized electronic response for the customer. They're not sending e-mail to "Webmaster" trying to find information about the product."
All of this technology is wonderful, but wouldn't it make more sense to simply conduct more focused online advertising, rather than comb through the noise generated by their shotgun approach? Not according to Bartlett. "Based on how the market [for banner ads] prices itself, we went with a very diluted approach," he says. "Instead of paying $80 per 1,000 [impressions] and targeting specific areas of sites, we pay in the $5 to $8 per 1,000 range," and reach a wider audience.
"We found better ROI per lead with the broad spectrum advertising," he concludes, comparing data from their broad-spectrum advertising with campaigns run in such niche areas as the Yahoo! Servers page.
Quantum is the first to admit that ROI is a tricky call for their marketing automation project. Although hard numbers are difficult to come by, they are absolutely convinced that they've done well. "We originally had budgeted $15,000 per month for a third-party provider, and MarketFirst is less expensive than that on an ongoing basis," says Bartlett. More importantly, "the leads are better qualified at this point, and we've gotten that feed back from the sales force directly."
Swope offers that the MarketFirst solution is more cost-effective than the old telesales qualification process was, even before adjusting for substantially higher quality leads.
At least in the short term, Quantum's Snap Division could have faced a bitter irony: a backlash from the sales organization grousing about the raw numbers of leads dropping off. After all, they expect 60 percent of their sales to come from their VAR channels. But Swope says that nobody on his team complained when the wasteful padding of the bad leads started to disappear. "The message from the field sales force was `quality over quantity,'" he says.