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List owners were unenthusiastic - to put it mildly - about the DMA's Business List Audit scheme when it launched last year. Aiming to raise standards in a sector dogged by an image of poor quality data, rapid decay rates and commoditised lists, a measly five companies signed up for accreditation - The REaD Group, Conduit, Mardev, Developing Data and Experian. If this hasn't been bad enough for the business-to-business side of the list industry, things are about to get much more complicated with the imminent launch of the Telephone Preference Service for businesses this month. Business data accuracy has never been a more pressing issue.

"Eleven per cent of company addresses change every 12 months and 15 per cent of decision-makers change over the same period," says Lloyd James Group's managing director Lynn Stevens. "There are some very poor lists that are not updated frequently and the situation could get worse before it improves."

BETTER STANDARDS

However, despite some gloom, it's certainly not all bad news. With the challenge now set to haul B2B up to the same level of accuracy as consumer lists, many players are forging forward to be first with a new methodology for marketing to businesses.

Data Locator Group, for example, launched Business Locator 18 months ago. This collates data at source via telephone research and is cleaned on a rolling six month basis. "Because of the success we'd had on the consumer side, we thought we could create a niche in B2B too," says Jo Smith, managing director of Business Locator (see box page 49).

Smith is seeing clients grow in confidence. "They're sick of using tired data, so they're starting to ask questions that don't appear on normal lists," she says. And they're prepared to pay for the right data.

One of the reasons the B2B list industry lags behind its consumer sibling is that suppliers haven't traditionally focused their energy on B2B. There's a perception they can't make money out of B2B because the volumes involved are much lower. In consumer lists there are 44 million households to target. There are only around three million businesses in the UK.

But clients are increasingly paying premiums to get their hands on good business data. Blue Sheep has found this to be true in marketing its joint venture with address management specialists Capscan, announced at this year's International Direct Marketing Fair (IDMF).

Blue Sheep managing director Iain Lovatt constantly heard clients complain that suppliers were repeatedly trying to sell many 1,000s of business names, when often they only wanted a more targeted 200-strong list. "Clients are unhappy to pay £200 for 1,000 names, which they then have to spend days sifting through to find the 200 they want. So we've launched a pay-as-you-go system," he says.

FLEXIBILITY

Clients can purchase credits as and when they wish to access The UK Business Universe product, which holds information on 3.4 million UK workplace locations. The database is commonly used to match and enhance existing data.

Although the pay-as-you-go approach is more expensive, this has not put clients off. "They're prepared to pay more for the convenience and time saving," he says. To get hold of 200 SME names, for example, clients are paying around £1 per record.

Lovatt believes the new system has found an answer to another client bugbear - data cleaning. He says clients have traditionally been reluctant to send Blue Sheep their existing data to be cleaned. "It can take days to get the information out of their systems and it can get corrupted. Also, clients don't want to send data out because they're embarrassed by the state of it," he says.

NEW SERVICES

Blue Sheep now sends clients a CD, monthly or quarterly, which they can use to run mass updates themselves. Two clients, including banking brand Alliance & Leicester, are already using the system.

Information Arts has also launched services on the back of negative feedback from clients. Joint managing director Gary Selby claims that the B2B industry has seen little innovation in the last 20 years but this is changing as smaller players challenge their bigger rivals to push the boundaries.

The database marketing consultancy has been working with several large data owners for the last two years to identify owner/managers - defined as individuals who run businesses and also own the equity - of SMEs and has compiled a list of four million names. These can be accessed via its Business DNA product.

Selby argues that understanding this audience is crucial, not to mention lucrative, if clients are embarking on B2B marketing. These individuals drive the company's decision-making such as its choice of bank, electricity supplier or broadband provider. Their net worth is much higher than the average consumer.

CONSUMER APPROACH

"Ninety five per cent of UK businesses are SMEs. Companies need to be more intelligent and take a consumer approach to target them," he says. "As soon as you've isolated their home details, the sky is the limit in terms of consumer demographics you can overlay."

Marketscan confirms this trend towards clients demanding more intelligent data than the standard fare. It is developing a product which will enable clients to target thriving businesses that have money to spend. This makes sense, after all, what's the point in going after a prospect that is about to go bust and with which you can't build up a profitable, long-term relationship?

"Responsiveness is the key issue here," says Julie Knight, managing director of Marketscan. "Everyone is looking for data quality but you need to know that a list is responsive."

Another indicator that the industry is pulling its socks up is the growing uptake of the Business Suppression File (BSF). TRG Strata, which has been distributing the BSF since 2001, says that educating clients about the product was an uphill struggle initially.

"A lot of people hadn't come across it before," says Richard Anderson, business development manager at TRG. "It was a case of education and justification but once people started to test it, they bought into it."

KEEPING UP TO DATE

Education is important because B2B is more complex than B2C. Consumers move house or die. Businesses do much more: staff can move internally, take on new responsibilities or leave; companies go bust, move premises or change their name. "A third of B2B data is out of date after 12 months so it's understandable companies feel like they're chasing their tails," says Anderson.

The raft of new products go some way to raise the B2B bar. But the industry needs a louder wake up call. The DMA's Business List Audit could be the answer. But Conduit's managing director Mike Gray and others are concerned it doesn't have teeth: "The lukewarm response to the audit is fairly typical of what happens in the B2B industry," he says. However, the DMA's Data Council chairman Tony Lamb says this summer's relaunch will put the spotlight back on the scheme. The focus is educating clients about what they should expect from a B2B list, advising them to look out for suppliers carrying the accreditation logo. "Many clients aren't aware of the audit yet but they will be demanding it in the future," says Lamb.

But maybe the last word should go to Gray, who argues for stronger action. "If the DMA is serious about its audit, it should make list owners sign up to it if they want to be a member of the association. Then we'll have a real opportunity to set a standard of excellence."

ENHANCED FLEET DATABASE

Conduit's MD Mike Gray believes that the future of successful B2B marketing lies in better-targeted lists. This is why Conduit enhanced its fleet database in March, launching it at the IDMF this year.

The core fleet database holds 92,000 records, but the enhanced version gives clients, namely companies which sell car-related goods and services, more information such as: how many vehicles businesses have in their fleet; how they finance them; whether they opt for Vauxhalls or Mercedes; when they intend to purchase cars next and fleet size.

By adding this data, Gray claims clients get a much hotter prospect because they can make their promotional offers timely and relevant, rather than blindly sending out mailings and hoping for the best.

Clients seem to agree. "Reaction has been tremendous, which shows there's a dearth of quality information," he says. Again, clients are prepared to pay a premium for this enhanced data - £1.50 per record, compared to only 14p for some lists, says Gray.

BUSINESS LOCATOR

Data Locator Group's MD Jo Smith describes Business Locator as a "business lifestyle list". Having used telephone research to compile consumer data, Data Locator decided to do the same to update the B2B market.

The product has been particularly popular with its telecoms and banking clients. For the latter, for example, it can be used to find out information such as which banks business use, whether they're happy with them and what factors would most likely make them consider switching to a rival provider.

In the telecoms sector , Business Locator can identify businesses that are looking to upgrade to broadband or those that have a mobile sales force which uses laptops. "Clients will pay for the right data. What's the point in just knowing a name and a number? It's much better to know if a company is looking to upgrade its mobile phones," adds Smith.

The questions Business Locator can put forward are diverse. Smith has been briefed before to ask anything from "Do you use water coolers?" to "Do you have employees that regularly travel to Asia and the Far East on business?"

As for the imminent implementation of the Telephone Preference Service for businesses, Smith is not worried: "We're collecting data, rather than selling a product, and we pass a lot of our data through the TPS before we telephone companies."