Wednesday, July 29, 2009

Helmsman Shows How To Serve Small Business Marketers

Summary: Helmsman Marketing offers turnkey marketing campaigns for small business. It's a great way to meet their needs, but probably not the model that will ultimately prevail in small business marketing automation.

I’ve spent a lot of time recently talking to marketing automation vendors hoping to sell to small businesses. They all seem to think this market is under-served and therefore open for them to dominate. In one sense they're right: there are millions of small businesses, few of which use serious marketing technology today. But the very fact that I'm talking to so many vendors means there is no lack of competition.

The entrepreneurs starting these marketing automation firms think they have few competitors because they rarely run into them. But that’s because small businesses rarely look for alternative solutions: if they see a system that seems to meet their needs, they’ll buy it and move on to the next project. Small business people just don’t have the time or expertise for elaborate vendor comparisons.

In the short term, this means that plenty of small business-oriented marketing automation vendors will prosper in isolation. Eventually, though, some will grow larger, market themselves more aggressively, and penetrate the awareness of small businesses beyond their immediate circle. That’s when buyers will recognize they have alternatives and be forced to make choices.

At the moment, though, the market is in that delightful early stage where a new vendor with a unique approach pops up every week. Last week it was Helmsman Marketing, a five-month old company focused on helping small businesses run multi-step, multi-channel, outbound customer relationship campaigns.

Ok, that last sentence is a mouthful. But I think it captures the key components of Helmsman:

- multi-step: the system runs campaigns that deliver a sequence of messages. The precise timing of these is adjusted for maximum response through the life of the campaign as Helmsman reports on results such as email opens. The reports are generated automatically and the adjustments are made manually. A typical Helsmark campaign might include five touches over several weeks.

- multi-channel: Helmsman delivers messages via email, automated voice mail recordings, fax, text message (SMS), and printed postcards. These are all managed by the vendor itself. Helmsman can also arrange to ship promotional products. The company stresses multi-channel campaigns because it has found that email isn’t always delivered and different customers will react to different media. Their use of post cards is particularly intriguing because it’s the second or third time I've recently been told that post cards are especially effective for small business marketers.

- outbound: pretty much all Helmsman does is send messages. Results like email opens are recorded within the system, but actual replies would be directed to a company CRM system or elsewhere. The one big exception is that the vendor can build and host Web landing pages and forms.

- customer relationship campaigns: most Helmsman programs are sent to existing customers to remind them of renewals or to schedule service appointments. The system is also be used for prospecting, such as seminar invitations. But the company warns that multiple contacts without an existing relationship can be annoying – particularly with intrusive media such as phone or SMS.

So that’s what Helmsman does. Integrated multi-channel capabilities are unusual, but otherwise the system offers less than most demand generation or consumer marketing automation products. What actually makes Helmsman special is something other than features: it’s a business model that is tailored to small business needs.

Specifically, Helmsman is sold as part of a service package that relieves marketers of the need to set up and execute their campaigns. According to Helmsman CEO and co-founder Tim Haller, he quickly discovered that small businesses lacked the time and skills to run a system like Helmsman for themselves. So the company meets with each new client for an hour or two to understand their goals and marketing messages, and then does the rest: designing the campaign, creating the marketing materials, sending the messages, and analyzing the results. If the customer list needs some data cleansing, Helmsman will do that too.

This approach avoids the time and skill constraints that – even more than direct cost – are greatest barriers to small business marketing automation. It also allows purely project-based pricing, derived from the numbers and types of contacts. This makes it easy for businesses to compare the costs and results of using the system, so they can judge its practical value. In the case of renewal and reminder programs, Helmsman is often fully justified by the savings from not having company staff make phone calls. Actual costs depend on the project (postage in particular is expensive), but have never exceeded $2 per contact. There’s a project minimum of about $750.

Helmsman released its product in April 2009 and currently has about 20 systems in place.

So where does Helmsman fit in the grand scheme of things? More than anything, it illustrates the importance of vendors helping clients to use their systems. Small businesses are the most extreme example of this need, but it applies to other, more sophisticated businesses as well. Helmsman also shows the importance of tying system cost to specific business value, something that its project-based billing structure does just about perfectly. The point about multi-channel contacts in general and post cards in particular is more tactical but still worth noting.

Yet despite these strengths, I don’t think the Helmsman approach will ultimately dominate in small business marketing automation. Specialized systems can be very attractive but companies don’t want too many of them. While Helmsman itself may succeed as a pure service, I expect that small businesses will ultimately adopt general-purpose marketing systems that support many applications in a single integrated environment. These systems might be sold with prebuilt project templates, similar to newsletter and Web site templates already offered by other types of vendors. Small businesses will then be able to pick and choose the projects they wish to execute without needing a separate vendor for each. Simplicity and support will always be essential for success, but the ultimate victors must combine them with flexible, extensible solutions that can grow and change with the business itself.

1 comment:

EvenBetterThanThis said... has been reminding people of their driver's license and inspection sticker expiring all along. And they don't share or sell your personal information. Support the local small business who pioneered this service instead!

** is an automated messaging service that reminds you when your Driver's License or Inspection Sticker is about to expire. You decide when to be reminded.

A need for such a system arose when the Registry of Motor Vehicles (RMV) announced that they would no longer be mailing renewal notices to drivers when their Driver's License or Inspection Sticker was about to expire. Unfortunately, people soon found out how expensive it could become when they forgot to renew them. The costs associated with driving on an expired Driver's License or Inspection Sticker could go into the hundreds and even thousands, along with the inconveniences of not having a valid I.D..

Thus, out of necessity, was born, and for a small price it can help you avoid a costly situation. It's quick, easy-to-use, and goes straight to your cellphone or Inbox so there's no paper waste. That's eco-friendly. What's more, the service is /_tax free_/. is getting things done by putting control in the hands of the people ... NOT insurance companies.