This blog was originally published on Business2Community on November 16, 2015:

https://www.business2community.com/marketing-automation/time-prune-lead-database-improve-roi-01375633#5vPxV8IhJ08uq6ww.97

 

Marketers face constant pressure to improve return on investment (ROI) and, therefore, spend a tremendous amount of time and budget fine-tuning messaging and creating engaging campaigns. The return on these investments are diminished if the lead database is of poor quality and not segmented. This poor data makes it difficult to create targeted campaigns and user engagements, thus limiting what you can achieve with your marketing automation tools. The most effective way to address this issue and boost your marketing ROI across the board is often a deep pruning of your lead database.

In this article, we’ll explore how we’ve helped several businesses successfully prune their lead databases:

How Do You Know it is Time to Prune?

In general, it’s time to prune your lead database when:

  • More than 25% of your leads have no email address or company name
  • Your email open rate is consistently below 20% and decreasing
  • Your email bounce rate is higher than 3% and increasing
  • You have only engaged with less than 50% of your database within the last 12 months

While there are no hard guidelines around pruning thresholds, you can find additional industry-specific benchmarks in MailChimp’s study of e-mail marketing campaign statistics.

Even if you do not have glaring quality issues with your database, some business drivers may require a database reset. For example, if:

Your business has changed

One of our customers has developed an entire line of new products and the old products are in maintenance mode. The new products target a different set of IT buyers than the old products. As a result, they removed the majority of the old leads from their database.

Your go-to-market strategy has changed

Another customer shifted their target market from small to medium-sized businesses (SMBs) to large enterprise. As a result, they archived the SMB leads from their database.

Now that we know when it’s time to prune the database, let’s take a look at how we do it:

What to Keep and What to Toss?

Identify which leads you want to keep active, delete and set aside:

Leads to keep active

  • The best prospects are typically leads that match your current go-to-market focus. This can be based on any combination of segmentation criteria that makes sense for your business, such as company size, industry, job level, and job function.
  • Other possibilities include leads of relatively good quality that are useful for immediate nurturing efforts, or can be improved in the short term to be useful.

Leads for permanent removal

  • Leads outside of your go-to-market focus. For example, if you sell a technical product to IT, then leads with other job functions such as HR and Finance should be permanently removed.
  • Bogus leads. Every marketer has seen his or her share of mouse@disney.com and “asdf asdf” leads. Use a data automation tool to identify these leads and permanently remove this junk from your database.
  • Leads with zero engagement within the last 24 months.

Leads to set aside

  • Leads that are missing email and company name are not very useful. However, you may consider setting them aside, if you can enrich them as budget becomes available.
  • Good leads that have unsubscribed. You need to keep these for compliance reasons, and to avoid marketing to them again if they are reintroduced to the database.

Tips for Pruning

Clean before you delete

Once you have developed your criteria of what to keep, toss, and archive, you need to sort leads into one of these three buckets. But first, you should clean, normalize, and segment the data. It may sound counter-intuitive to spend time improving data only to delete it later, but categorization work, whether automated or manual, works better with improved data quality.

For example, if you plan to delete all leads that work in finance and HR, then you need to determine the leads’ job functions from their job titles. After segmenting, you can then isolate the targeted job functions for deletion. An easy-to-use data automation tool is the quickest and most cost-effective method to automate the work of cleaning and segmenting your database. Without a data automation tool, you will have to manually review, update, and delete each lead – a daunting, boring, and carpal-tunnel-inducing task that no one enjoys.

Save money storing archived leads

Now that you’ve identified which leads to archive, where should you keep them, especially if there is a large quantity?

Unsubscribed leads should be retained for compliance reasons and need to stay in the marketing automation platform so emails to these addresses are suppressed.

Leads with missing emails are useless to marketing automation platforms, and can be moved to a customer relationship management solution or to a data automation platform. This keeps the lead data accessible for future improvement efforts without having to pay for storing it in the marketing automation platform.

Keep it clean

Your lead database starts to deteriorate immediately after you’ve cleaned it. To avoid another massive pruning exercise, it is critical to maintain the quality of your data. Using a combination of data automation technologies and data enrichment services, you can:

  • Clean and normalize geographic and contact data
  • Infer missing geographic and contact data
  • Validate email, address, and other contact information
  • Segment job function, job level, purchasing role, industry, and company size
  • Suppress emails based on the latest information from the demand generation and sale teams

Recommendations

In a busy environment, database quality and maintenance often fall to the bottom of the priority list. However, as your database is the foundation of all your marketing programs, it pays to improve and maintain it. Often the most effective way to improve your database is a deep pruning, which can lead to improved ROI across all of your marketing endeavors. Leveraging the most economical combination of data automation solutions and data enrichment/validation services can help to keep your pruning and ongoing maintenance efforts simple and affordable. Is it time to prune your database? Register for a free Openprise demo today and get started.

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