B-to-B Sales Slowly Rising

LIKE THE TORTOISE that won the race, business-to-business sales are moving ahead slowly but surely, according to results of a survey presented at this summer’s Acxiom/Direct Media B-to-B Co-Op in White Plains, NY.

The annual business-conditions survey of 58 companies showed gross mail order sales rising an average of 7.8%, and pretax profits up 6.1% in 1997 over 1996. Seven percent growth is expected this year.

As for mailing activity, respondents indicated prospecting quantities would increase an average of 6.2%, while mailings to existing customers would be up 4%.

To no one’s surprise, respondents reported that sales to existing customers were stronger than their prospecting efforts: Eighty percent indicated existing-customer business was excellent or good; only 57% said the same was true for prospect mailings.

Questions focusing on order size backed up the relative strength of customer mailings over prospect mailings. While existing customers average order was more than $1,045, with a top of $25,000, prospect mailings yielded typical orders of just under $587, with $10,000 at the high end.

B-to-B mailers are getting more aggressive, according to the survey. The average number of mailings to a customer in 1997 was 11.5, but mailers planned to send just over 12 to each customer in 1998. The difference was even more striking among a mailer’s best customers: In 1997 they received 13.7 mailings, while in 1998 this was expected to rise to 15.

For the first time, the survey included questions about e-mail. Sixty-nine percent of respondents indicated that less than 10% of their file had e-mail addresses attached, and 17% of those surveyed said between 10% and 25% contained them. Only 3% said between 25% and 50% of their file held e-mail addresses. Six percent reported between 50% and 75% on file, and 5% noted between 75% and 100%.

Storage doesn’t necessarily indicate use-only 35% said they marketed to these customers via e-mail.

But that doesn’t mean the companies surveyed aren’t selling online-83% of them have an active Web site. Of those with sites, 57% are taking orders online, 74% are capturing inquiries and 68% are using them to disseminate information. Only 4% said more than a quarter of their transactions were online.