Demandbase now offers B2B ad-targeting based on the software companies use

By Michael Carney , written on February 14, 2013

From The News Desk

Online marketing is a highly competitive, data driven business. Companies have developed all manner of tools for understanding and targeting consumers according to demographic and behavioral data. But there are fewer options available in the business to business (B2B) space, despite the fact that the "enterprise" category is as hot as it’s ever been.

Demandbase offers one such tool, enabling B2B marketers to target and personalize online advertising according to specific companies. For example, if the maker of a CRM software wants to target the users of its largest competitor, Demandbase can identify individual employees of those companies online according to their corporate IP address – rather than through cookies – and then deliver targeted advertising.

Today, the five-year-old company rolled out a new ad customization feature called Company-Targeted Advertising that allows marketers to serve uniquely relevant ads to each target customer based on attributes beyond their employer. For example, an ad may dynamically read “A CRM system for the financial services industry,” when encountered by a member of that industry, and then later change to “A CRM system for the insurance industry” when next served. This technology can be applied not only to ad units served on third-party sites across the Web, but also to the copy on a company’s own Website.

Demandbase CEO Chris Golec believes that Company-Targeted Advertising eliminates waste in B2B advertising by serving ads only to the companies that meet a campaign’s targeting criteria. Some campaigns will target a competitor’s customers. Others will target users of a complementary software, such as “Simple CRM for companies that use Quickbooks.” Others still will target ads to “companies in California with between 500 to 1,000 employees.”

Regardless of the parameters, ads will never be shown to irrelevant audiences, thereby increasing the efficiency of the marketing spend. The new technology mimics behavioral targeting and segmentation tools which have long been available to B2C marketers, only “without the creep factor,” according to the company.

“We have always set out to empower marketers with a set of tools that provide actionable ways to connect with the prospects and customers most valuable to them,” Demandbase founder and CEO Chris Golec says. “Demandbase Company-Targeted Advertising now gives marketers multiple ways to segment and target their audiences, with the precision they need to reach specific audiences and personalize the entire customer experience from start to finish – something that has never been available to B2B marketers before.”

Early users of the new Company-Targeted technology have seen performance lift as high as 2X to 3X according to the company. Simple tweaks in messaging, such as changing the word “company” to “organization” within website copy when encountering a member of a Government entity, has shown to increase conversion by up to 86 percent, according to Golec.

Not surprisingly, the best results have been seen when users combine Company-Targeted Advertising with Demandbase’s website optimization and sales IQ analytics tools. Demandbase integrates with other complementary marketing technology platforms such as Marketo and Eloqua, with the companies often co-selling their solutions.

It helps when Demandbase users know exactly what companies they want to target. But the platform also enables them to identify new target companies according to desired attributes and then target advertising to these prospects.

The tool is not just for enterprise software sales, and is currently being used by those in the software, manufacturers, banking, and consulting industries, among others. Prominent customers include Adobe, Avery, Cisco, Dell, Dun & Bradstreet, HP, IBM, Qwest, and Vodafone.

The software is sold on a monthly SaaS license, with users typically paying between $100 to $200 per target company per month, depending on the various modules they choose to use and with the unit costs declining with the number of targets.

Demandbase currently employs 70 people, and has plans to grow its sales team significantly in the near future. The company has raised $18 million across two rounds of venture capital financing from Sutter Hill Ventures, Sigma Partners, Altos Ventures, and Adobe Systems.

One of Demandbase’s greatest advantages currently is that it’s the only provider of these B2B targeting and segmentation solutions, according to its CEO. As this “entirely new category” becomes more widely known, expect increasing competition. While Demandbase’s technology is proprietary, much of the underlying data that it uses to segment audiences and personalize content, such as company IP address, industry information, and software utilization data, is available publicly. This will lessen the burden of potential challengers, particularly those which already own B2C ad-targeting technology.

The era of online “spray and pray” marketing is over. Today, the best in the business demand the ability to target and personalize advertising, and then to measure the return on that investment. Eventually, this will be equally true in the B2B space as it is already in the B2C category.

“People under-appreciate the opportunity to change the entire customer life cycle with better targeting,” Golec says. “We can get the right customers to their website, better engage them once they’re there, and get them directly into the sales cycle.”