How many pre-approval credit card offers do you receive in a week? If you’re like most Americans, probably quite a lot. It may be surprising to some that, in this digital age, banks still send out credit card solicitations by mail. But there’s one key reason why they do it: They work.
Direct mail is in fact the third strongest form of marketing, according to a survey by the Data & Marketing Association. And while it’s not growing in terms of volume, it still typically returns the best response rate, though at a high cost per acquisition. And according to the same survey, email marketing—the digital counterpart to direct mail—continues to provide the best ROI. Between the two, B2C direct response marketing is doing extremely well.
We mention this primarily because we believe there are lessons to be learned and applied to B2B marketing. We’ve talked a lot about how instant credit approval for B2B buyers can have a major impact on closing sales online. But it can also be used in the top-of-the-funnel marketing activities as well using Credit Key’s unique process for pre-approve existing and prospective customers for lines of credit. In other words, you can use Credit Key to drive a marketing tactic that works extremely well in B2C, but has generally been untested in B2B. Which is great, given that 47 percent of B2B marketers are highly focused on delivering quality leads.
Given the overwhelmingly positive response rates pre-approval credit card offers bring, it’s time to incorporate this tactic into your marketing toolbox, if you haven’t already. Here’s how.
Segment your customers
Using Credit Key’s highly-accurate, proprietary decisioning software, we can help you determine which of your customers are credit-worthy and how much credit to extend to them. All we need is their business name, address, and customer history, and we can provide a segmented list of clients who can be considered “pre-approved.” This way, you can develop a highly personalized, exclusive offer for the most qualified set of customers around pre-approval.
Wake up tired customers
You may already offer discounts on a regular basis to various customer segments. But you may have noticed that over time, these types of offers tend to lose their effectiveness as a marketing vehicle. Plus, you have to actually give the discount, which reduces your revenue.
But very few B2B sellers offer pre-approved credit lines, which means you can use it as a vehicle to re-engage with customers who have become bored with the standard offers and possibly haven’t bought in a while. Being pre-approved might even come as a welcome surprise for many B2B buyers, who are facing their own challenges of getting their jobs done.
Even though B2B merchants are somewhat protected through the trade credit process, there’s still a risk that the customer won’t pay on time or even at all (especially for new customers). Additionally, credit cards always carry the risk of chargebacks, which often puts the seller out of both product and money. However, because Credit Key manages the entire underwriting process, your business can offer pre-approved credit lines without taking on any financial risks.
Stand out from competitors
This is particularly true if you work in a highly commoditized industry. Offering a pre-approved line of credit can be a real competitive advantage. Most B2B sellers don’t offer instant lines of credit, making it difficult for buyers to, well, buy. What would happen, though, if you helped them run their business more effectively through a pre-approved credit line while also delivering the products they need to be successful faster? Because they don’t have to go through the long process of getting approved for trade credit, you’ll be able to ship faster. So instead of being just another widget seller, you’ll be the widget seller who delivers fast and hassle-free.
We talked about this recently, but it’s worth repeating: Buyers are more likely to place reorders from places where they have a line of credit because it’s more convenient. And each purchase is an opportunity to further engage and deepen your relationship with that customer.
Want to learn more about how offering pre-approved credit lines can help you win more customers? Contact us to see how Credit Key can increase the number of high-quality leads you get.