What Is A List Broker And Why Should I Use One?

In my years of experience working with PTC's Value Added Resellers (VARs) on their marketing activities, it always baffled me why none of them were using a list broker. I had countless conversations with VAR marketers to try to explain the value of it. I built it into every presentation I ever delivered on marketing planning and marketing tips and tricks. I even invited a really excellent list broker (Oceanos List Intelligence, http://www.oceanosinc.com) to co-present a VAR marketing training webcast on list acquisition and packaged an engagement with Oceanos as a "free consultation" for the VARs (would have been free anyway, but I was trying to build some excitement around it).

But PTC's VARs never took the advice. They did rent and purchase lists occasionally, but they would always purchase directly from individual list owners instead of engaging with a list broker. The only explanation I can come up with is that the VARs are, by nature, very reactive marketers. They don't have a big marketing staff, they don't put a lot of time into developing a plan. And when a list owner or ad rep would call with an offer they would just accept it (or not) without conducting much of a competitive analysis.

Your Audience Acquisition Strategy Should Be Marketing Priority #1
As I have said many times: there is nothing more important in marketing than understanding your target audience and coming up with a plan for how to get your message in front of them. My previous post was about how to define your target market. Now that you have defined your target market, you should consult with a list broker to put your target market plan into action.

4 Reasons You Should Use A List Broker:
#1: Compare Apples To Apples
Lists are an important investment and they should be rented or purchased only after careful consideration and comparison. The list broker will take your target market definition and then conduct a research project to develop an exhaustive "list universe report" of all the postal/email/telemarketing lists that match your definition.

The list universe report will include data cards for each list source. Data cards are essentially spec sheets that describe everything important about the list:

• How the list was sourced
• How many records are in it
• Does it include postal/email/telephone contact information for each record
• What key categories you can select or filter out to ensure you get the best match against your target audience (company size, industry, job title, etc.)
  
• Cost (base cost, minimum purchase amount, cost for each selection criteria applied, shipping & handling fees, etc.)
• Etc.

Once you get the list universe report, you can use it to make an "apples vs. apples" comparison of lists to ensure you are getting the best value. You can make your list selection a strategic decision instead of a reactive decision. And therefore you will spend less time chasing your tail on low-value activities and more time executing against a plan that can be measured, vetted, and defended.

#2: A List Universe Report Can Inform Marketing & Product Decisions
A list universe report is not just good for renting or buying marketing lists. It is a window into the world of your target market. Take your list universe report and start to look into the various list sources and you will find:

• News publications and websites you should be targeting for PR efforts and perhaps advertising
• Professional Associations you should be sponsoring, supporting, and joining
• Trade shows at which you should be speaking, attending, or exhibiting
• Conversations that are occurring that can help to guide your product roadmap and marketing messaging
• Competitors you should keep your eye on
• Potential integration and co-marketing partners
• Opinion leaders you should be following on Twitter

#3: A List Broker Can Do It Better Than You Can
In a job interview once I was asked what my first activity would be if I got the job. I said one of my first activities would be to engage a list broker. The guy said "do you know what SRDS is?" Yes, I know what Standard Rate and Data Service is. I know what data cards are. I know that I can go on the internet and find data cards and media kits myself. I once worked as a list broker, using tools like NextMark to create list recommendations for clients. My experience made me appreciate the services of a good list broker even more. That's because even with access to *subscription* tools (they are not free) like SRDS, NextMark, and Marketing Information Network (MIN) I learned that it is hard work and that experience matters.

Here's the thing: wouldn't you rather have someone do it who is more highly skilled than you? When I was a teenager I once changed the brakes on my car. I know I can do it. But I would rather not spend my day running back and forth to the auto parts store, crawling under my car, bashing my knuckles on the undercarriage, and swearing a blue streak. Instead, I prefer to get an experienced mechanic to do it in their garage with a hydraulic lift and all the right parts and tools. I will be more confident in my car's ability to stop afterwards, because I know that a skilled expert can do a brake job better than me. And I consider it well worth the cost. Which leads me to this...

#4: A List Broker's Services Are FREE!
Any VAR should immediately understand this business model, because List Brokers are Value Added Resellers of lists. List brokers essentially buy lists from list owners. They get a broker's discount on the price of the list from the list owner, just like a VAR gets a marginally discounted price when he buys the software from the ISV. And then the list broker resells the list to you at the list price (thereby making their money on the margin).

So you pay exactly the same amount you would pay if you purchased the list directly from the list owner, but with a ton of *added value* from the list broker:

• A list universe report that helps you conduct an apples-to-apples comparison of various list sources
• Aggregated billing (you pay one list broker instead of many list owners)
• Management of the logistics (managing the schedule, managing your suppression list of existing customers, managing the suppression of previous list buys, QC of your emails for email marketing, etc.)
• Aggregated open/click reporting from multiple list buys (for email marketing)
• Historical record of the transactions -- so over time you don't waste money buying the same list twice, or a list that performed badly for you in the past
  

The list broker does not charge you for that added value, it comes along for the ride. It is the biggest no-brainer in marketing!

Next topic: What are the 3 types of lists, and what are the advantages/disadvantages of each.