Building a Database for your Small Business

Information is power in the 21^st century and it is a powerful tool for small businesses.

Now that the nature of marketing has shifted the power to buyers over sellers, new marketing strategies are required.

Something that hasn’t changed is that every business needs to make sales and needs people to sell to.

A key strategy that all small businesses must deploy is creating a database of customers and potential customers. This is not simply a list of emails and company names but a list of likes, preferences and other detailed info. It is also true that not all databases are the same and creating a useful database take time. This is not just the time to create the database but also the time to maintain it.

Which leads some to ask: “Why not just purchase a huge list of names and email addresses and start from there?”

Here are four reason explaining why that’s a risky move:

1.     The addresses on those lists get sold to all kinds of marketers. So they get all kinds of mail. So, they lodge all kinds of spam complaints. If ISPs like Gmail and Hotmail notice, they might put you on a blacklist, blocking your emails from all their users in the future.

2.     Because of the way these lists are compiled, many of the addresses you receive will be misspelled, abandoned or non-existent. When a big chunk of your emails goes to such addresses, ISPs, again, might notice. Again, they might block all future emails from you. List merchants know this. It’s such a sure thing, they even offer a refund of credit for those addresses up-front.

3.     And if you’re sending through an email service provider and you get blocked, other messages they send from the same IP address could also be blocked. So you’ll actually find that no reputable ESP will let you import a purchased list anyway.

4.     Unprepared recipients aren’t likely to think, “Oh gosh, I was just hoping for yet another offer from a company I don’t know! Let me click over to their site and buy something!”

So the answer is to compile your own database. This also allows you to create a “permission-based” database of customer information. This means the subscribers to your list want to be contacted and represent the first step in the customer cycle. It is based on trust and you must never abuse this list. There are multiple ways to obtain this information via your website or other marketing initiatives. We will leave that for another blog though.