Transcript of a BriefingsDirect on how a mid-market company saw immediate results from participation in Ariba Discovery, eliminating the need for mailing half a million catalogs a year.

1. Combining Big Data and Cloud Capabilities for ECommerce
Matches Buyers and Sellers Like Never Before
Transcript of a BriefingsDirect on how a mid-market company saw immediate results from
participation in Ariba Discovery, eliminating the need for mailing half a million catalogs a year.
Listen to the podcast. Find it on iTunes. Sponsor: Ariba, an SAP company
Dana Gardner: Hi, this is Dana Gardner, Principal Analyst at Interarbor Solutions, and you're
listening to BriefingsDirect. Today, we present a sponsored podcast discussion on
ways that businesses are using cloud and e-commerce to improve how they do
sales, marketing, and online transactions.
We'll examine how one company, Ohio-based LLT Barcode & Label, has found
powerful new ways to develop sales and leads using Ariba Discovery.
[Disclosure: Ariba is a sponsor of BriefingsDirect podcasts.]
To learn more about how social tools and business networks are reshaping eCommerce and how
companies like LLT Barcode & Label is using the cloud to better connect with new customers,
please join me in welcoming our guests today.
We're here with Rachel Spasser, the Senior Vice President of Marketing at Ariba, an SAP
Company, and Kris Hart, the Account Manager at LLT Barcode & Label in Stow, Ohio.
Welcome, Rachel and Kris.
Kris Hart: Hi. How are you doing today, Dana?
Rachel Spasser: Thanks, Dana. Glad to be here.
Gardner: Rachel, I'll start with you. This whole concept of finding customers, developing leads
using cloud, using the networked economy and how people are linked
up now more-and-more. It's also, I think, a function of the data
that people are now able to access.
Tell me a little bit about how things have changed, say now, versus five years ago, in terms of
just connectedness, and how this is now being brought to bear on an age-old problem, which is
finding sellers for buyers and buyers for sellers?
Spasser: We're talking about major changes that have gone on in the past few years. If you think
about the mantra around marketing, it's always been to make yourself, your product, and your
company relevant to potential buyers.
Ten or 15 years ago, as the Internet was really coming into its own, it provided significantly more
data that helped us understand demographically, and a little bit behaviorally, who our customers
were and what they were doing.

2. When we talk about the networked economy, business networks, and connected commerce we're
really taking that to a whole other level, where as marketers, we're able to hyper-
target, our potential customers not just on their demographics, but also be able to
predict when they're going to be ready to buy.
They overtly raise their hand and say, "Hey, I'm interested in buying by a
connected RFI or RFQ process." But we can also analyze the myriad data that's
available today and put both unstructured data and structured data together in a
way that helps us predict when they are going to be ready to buy. That's when we can
actually present them with compelling offers. So it really does change the whole nature of the
game.
What's appealing?
Gardner: Kris Hart, do you really care whether it's the cloud or the networked economy, or
whether it's structured or unstructured data? What appeals to you in all this in terms of the
change that's going on?
Hart: In general, you don't really care one way or another how you get it. the cloud and e-
commerce makes everything a lot easier, not just for the seller, but also the buyer. It really helps
with the relationship, and being on the cloud is much simpler, faster, and easier.
Gardner: Tell us a little bit about LLT Barcode & Label, so that we have a better understanding
of your business, the vertical, the challenges that you face in terms of growing your business, and
finding new customers?
Hart: We started about 16 years ago. It was a small company and we're still a small company,
where it's hard to get out in front of buyers. When we started, we would send out
about a half million catalogs a year. Those catalogs have inside them labels,
thermal transfer ribbons, and laser labels, and items like mobile computers and
printers to be able to print those items.
We started out as a small company, basically a distributor for a company that
needs to ship a label via FedEx, UPS, or however. They need a label on that box
to be able to ship their product. So as far as vertical markets go, if you name a
company, they have to ship something, and they'd be able to use that.
So we play in every single market out there. We gross roughly about $12 million a year and we
have about 15 people who work for us.
Gardner: So, you're a mid-market firm, with potentially a very wide addressable market with
anyone that's doing shipping and delivery activities. How did you do lead generation and sales
and marketing before you started the cloud methods that seemingly have been so successful?

3. Hart: The way we started is that we would have a lot of catalogs printed with our most popular
items and then we would buy lists from Hoover’s, or somebody like that, and we would send out
half a million catalogs a year.
We were hoping that everyone who got one of those catalogs would call us and want to buy
something. But that's not the case, and over the past 15 years, that return on investment (ROI)
has gone down significantly.
We started out as a catalog company, and now the catalog companies are, in a sense, dying or
aren't as successful by and large. So we had to find new ways to grow our business.
Gardner: Correct me if I am wrong, but that was mostly you pushing your message into some
other organization, with not a lot of pull necessarily. It seems to me that you would want a little
of both, the pull and the push. How did the cloud change that equation?
Internet has helped
Hart: The Internet has really helped. A lot of people at home are using sites like Amazon.com
and eBay and they're getting used to just looking on the Internet when they need to buy
something.
When they go into work, because it's so easy at home, they want to be able to do the same thing.
It's a win-win for both sides. We don't have to print lots of catalogs every year, and they can just
find us on our website or search engine via Google, Bing, whatever.
Gardner: Why wasn't it just creating website and being part of the massive index that Google
and other search engines use? Why was it better moving towards a structured cloud environment,
an e-commerce cloud, a networked economy approach like Ariba Discovery? Why was that
different?
Hart: The biggest thing with Ariba Discovery is that it's very much like match.com. We wanted
to be in front of buyers when they were ready to place an order. We wanted to be that company
that that person on the other end is going to come search for, see us, and give us an opportunity
for their business.
If I walk in in the morning, I already have leads there. I already have an opportunity with a buyer
who knows what they're looking for. They're out there on Ariba Discovery, asking me, "Can you
help me?" That's a lot easier than like the catalog theory, hoping that someone runs across your
website.
You know automatically what that buyer is looking for and where that buyer is, and hopefully
within a couple of sentences, a couple of conversations with them, you can figure out when they
need to buy.

4. Gardner: Back to you, Rachel. When you hear Kris describing how they’ve come to these new
approaches, what are you thinking? What is it that occurs to you?
It seems to me that he is talking about an ability for a mid-market company to scale down to the
individual. It's pretty impressive, the granularity with which commerce could happen. Not only
that, but at the scale of a global marketplace, it's kind of fascinating that it’s both downscale and
upscale at the same time.
Spasser: It is, and I think if you listen to what Kris said, the Internet has enabled business to be
done faster and for him to find new customers faster and more efficiently.
But where the business networks really differentiate themselves from the Internet as a whole is
that there is a common platform, where both buyers and sellers are going to connect and find
very specific commodities or services that meet their specifications. Creating a platform that
enables them to get to that level of granularity enables them not just to conduct commerce faster,
but conduct commerce smarter.
More and more data
As we look at the value of the business networks, over the course of time, these networks are,
in essence, aggregating more and more data and insights that ultimately help companies like
LLT Bar Code in that mid-market that want to do business globally. At the same time, it helps
global buyers that want to buy, for various reasons, from companies that are either local
suppliers, from companies that might have green initiatives, women-owned business, or diverse-
owned business.
So there are a lot of different criteria that go into determining who you want to buy from or sell
to. The beauty of the business network is that it gives you the ability to both get insight and get a
lot of information on the buyer or the seller, and to connect based on very, very specific criteria.
Gardner: Kris, one of the things that’s interesting in comparing a web-based open-Internet
approach to something more standardized is speaking the same language, data, metadata,
taxonomy. It might be one thing for you to put up information on your website, but somebody
who's searching, or even the search engine algorithms, might not understand the importance of
certain terms and lingo.
Is there something about going into environments dedicated to buying and selling, where you can
actually line up the right information, description, indexing and terms, or even just the way of
doing business, the process behind doing business? Tell me how a common understood business-
oriented environment has helped with your results as well?

5. Hart: Well, with Ariba Discovery it’s great. They have postings for all sorts of commodities and
items that a buyer may be looking for. A buyer can check them off on his screen and then send
out an RFQ.
The nice thing about having that similar platform is that I set up a profile. I select specific
commodities of the types of business and the items that we operate in. With that, a lead is
automatically given to me. The buyers are looking for specific things, and it may be in his own
terms or maybe a little bit different than how he may search it on the Internet and possibly miss
us.
I can take my list of commodities and then it will be automatically generated. It’s going to come
pretty close. He is going to be right there for me to be able to respond to whether or not we can
help them, yes or no.
Gardner: So those hit-or-miss semantic issues that are certainly part of the Web are fixed and
amended. Your semantic matchmaking, as you put it earlier, is automated and therefore that
probably makes this a lot more powerful. Tell me how powerful. What are some examples of
what’s happened when you have gone to Ariba Discovery for lead generation and new market
penetration?
Hart: We started looking at Ariba Discovery in late 2011. We were trying to find some other way
to gain new customers and to grow the business. We decided on Ariba Discovery in January of
2012. There were a couple of RFPs out there, and I thought, "Why not give it a shot?"
So we respond to a couple, and the first RFQ that I had responded to was for some blank labels
and a couple of colored labels. A couple of weeks later I get an email from the client that had
posted the RFQ, and they want us to bid on their entire distribution, labels, ribbons, and shipping
items.
Too good to be true
And after going through their process of RFQs, add-in items, pricing, and everything else, we
won about a $400,000 deal via Ariba Discovery. That was for a two-year contract, and that was
the first one. It was almost too good to be true.
The great thing about it was that we started in the middle of January, when I responded to the
RFQ and we had the contract and everything signed and they were buying from us in April. Very
quick process.
Gardner: What was your cost in acquiring this customer?
Hart: With Ariba Discovery, you can use Ariba Discovery for free or you can use the Mid-Level
or the Advantage. And we decided to go with the Advantage.

6. That had some other benefits with the profile and things of that nature and it was only $3,000.
We decided to take some of our marketing budget and put it into that and at least give it a shot.
We were more than happy. We got our ROI right-away, and it's a much better and simpler process
than sending out a half a million catalogs a year.
Gardner: Absolutely. Rachel, again reacting to what Kris has said, are we missing anything in
this equation? I'm interested in this semantic match-up that takes place, the data, and how this
can be automated. Kris is obviously talking about strong ROI. Is there more to the story here that
we’re missing in terms of how buyers and sellers are matching up in new ways?
Spasser: We love to hear stories like Kris’ about immediate ROI. And we hear them over-and-
over again from suppliers on the network.
One benefit, as we talked about, is the ability to define very specific criteria as a seller as to what
you sell, so that when you do get posts that are directed to you, you know that they're relevant to
you. You’re not wasting your time. You’re not sifting through a lot of unqualified opportunities
as the seller. And the benefit to the buyer is the same.
As the buyer posts, their posts are being sent to people who are all qualified, who all have the
ability to meet the specifications that they have created. Therefore, it's saving a lot of time on
their part as well. When you look at the two-sided model, it really is a win-win both for the buyer
and the seller within the network.
One of the hidden pieces of gold within the network is the data that's created over time from all
of this transactional information, as well as data that is created individually from buyers and
seller. They're providing information on ratings and reviews of how quickly they got paid, if
they're a seller, by a particular buyer. Or it's the reverse, how accurate and on time deliveries are
if you’re a buyer looking at a seller.
So, the unstructured information, combined with a lot of structured data, is creating an
opportunity to make much better matches and have buyers and sellers that are much more
informed about one another as they enter into business relationship.
We all know the more that we understand and have well-defined expectations of our business
partners, the more effective those relationships are over the course of time.
Some structure
Gardner: Kris, you've obviously been exploiting and enjoying benefits from the discovery
aspects of the Ariba network in the cloud. But, beyond the actual finding of that customer, that
customer might have many years of business to be had and there needs to be perhaps some
automation or structure around that relationship.

7. Have you been able to find that the services around process for procurement, automating the
invoicing and PO process, the data, even the transactions. Is there sort of a progression here that,
once you've established a connection with a customer, there are other ways to exploit these
services and make that a more efficient customer relationship?
Hart: Yeah, it's funny that you bring that up. Right now, that particular customer has gone to
Ariba for some other items that they are going to start using for procurement and different items
like that. What we're hoping is that once that process takes over, then we can be in the supplier
network and possibly even set up e-catalogs for them and make their process a whole lot more
efficient and easier.
That way, if they have any transition in buyers, someone is on vacation, or anything like that,
there are no questions about the items that they purchased from us. There are no questions on the
pricing, on who to send the purchase orders to, or anything like that. It's all handled by Ariba.
Hopefully, we'll be able to set up a catalog, and they'll be able to smoothly purchase from us. It
already helps us being on the supplier network and then them hopefully getting ramped up and
making everything a whole lot more smooth.
Gardner: Rachel, it seems as if Discovery is an important part of this, but it's really kind of the
point on the arrow. There's a lot of wood behind that in terms of more streamlining and more
efficiency. How are the new services being brought to bear on helping mid-market companies
like LLT extend their benefits beyond the lead generation into the whole e-commerce lifecycle?
Spasser: It's great to hear Kris talk about the benefits as it relates to efficiency from a process
perspective on the network. One of the other benefits of setting up a catalog to do business with
that one buyer on the network is that now you have the catalog set up on the network.
As you get additional buyers, you're using the same catalog and the same infrastructure. You can
now start connecting with multiple buyers via the network, which enables you to create even
greater efficiencies as a mid-market seller who may have limited resources within the company
to issue and reconcile invoices.
The efficiency of setting up one relationship is the starting point. There is much more efficiency
as you start to establish more-and-more relationships as a seller over the network. But there are
other services that we offer over the network that also create value, and one example is our
Dynamic Discounting Program.
For example, as a seller on the network if you would like to get paid faster from one of your
buyers, you can offer different payment terms. Let's say your contract is a net-60 payment term,
and you’d like to get paid faster because you’d like to make some capital investments in your
company. You could offer to provide a discount for a net-10 payment.

8. Discount terms
We have many mid-market suppliers who have offered those discount terms to their buyers, so
that they can self-fund growth for their own companies. That's yet another benefit of doing
business on the network.
The third major benefit is the visibility and predictability that you have in relationship with the
customer. At any point in time, as a seller on the network, you can go in and see the status of
where your order stands, where your payment stands, or whether your invoice has been approved
for payment.
It gives you a lot more visibility, and therefore predictability, as a mid-size business, into things
like cash flow. You can anticipate when you're going to get paid, instead of having to pick up the
phone 16 times and say, "When is the check is going to come? Have you approved the invoice?"
So there's efficiency, visibility, and predictability, and then there is the opportunity to impact cash
flow by using some of the more sophisticated tools like Dynamic Discounting to speed up
payment.
Gardner: Rachel, Tell me a little bit about some of the future roadmap that Ariba is embarking
on around a wider, deeper, richer basket of goods and services.
Spasser: One of the things that we are doing, really focused on the lead generation side, is
expanding the services that we offer around Ariba Discovery that can help companies like LLT
Barcode & Label find new customers worldwide.
Related to that is the ability to create multiple profiles that are very highly targeted. So for the
various products that LLT Barcode & Label offers, they could create a profile unique to different
industries. Or if there are different industry requirements around labels and barcodes, they can
create very specific, targeted profiles that really make them extremely relevant to buyers within
various industries.
Another service that we are offering is what we are calling "Sellers You Might Like," and that's
the ability to based on what someone is searching on proactively suggest sellers that meet their
criteria.
So even if a buyer does a search and doesn't necessarily click on a particular supplier, if that
supplier meets those criteria from an algorithm perspective, that suppler will be proactively
suggested, especially if that supplier has received high ratings and reviews from other buyers on
the network.
So there are couple of new services that are being offered from the Discovery side that will really
accelerate the ability for mid-market companies like LLT Barcode & Label to grow their
business and expand the value that they get from using the Ariba network.

9. How to get started
Gardner: I'm afraid we're just about out of time, but Kris, I wonder if you might have any
20-20 hindsight, based on your experiences so far, that you could offer to other people who are
looking to get started on this cloud-based, commerce and lead generation activity.
How do you get started? What would you recommend for others as they embark on this?
Hart: Definitely give it a shot. Set up a free profile and start getting some leads generated,
something that comes your way. Definitely make sure you're in the right commodities. Don't start
clicking boxes for commodities that you can't offer. That way, your leads are more precise and
more ready to go Then see what happens for free.
If you want extra help and a little bit better outreach with the marketing profile, go up the next
step or even all the way to the top like we did. We saw the benefits and doing that with the
marketing help that we have from Ariba and how to use the Discovery tool. As I said, that paid
off for us, but definitely give it a shot. If nothing else, just set up a free profile and see where that
takes you.
Gardner: All right. Well I'm afraid we'll have to leave it there. You've been listening to a
sponsored BriefingsDirect podcast discussion on ways that businesses are using cloud and e-
commerce to improve how they do sales, marketing, and ultimately online transactions.
We've seen how one company Ohio-based LLT Barcode & Label, has found a highly effective
way to develop new sales and leads using Ariba Discovery. So let's thank our guests. We've been
here with Kris Hart, Account Manager at LLT Barcode & Label. Thank you so much, Kris.
Hart: Thanks a lot. I appreciate it, Dana.
Gardner: And also Rachel Spasser, the Senior Vice President of Marketing at Ariba, an SAP
Company. Thank you, Rachel.
Spasser: Thanks, Dana. I appreciate the opportunity.
Gardner: This is Dana Gardner, Principal Analyst at Interarbor Solutions. Thanks a lot to our
audience for listening, and don't forget to come back next time.
Listen to the podcast. Find it on iTunes. Sponsor: Ariba, an SAP company
Transcript of a BriefingsDirect on how a mid-market company saw immediate results from
participation in Ariba Discovery, eliminating the need for mailing half a million catalogs a year.
Copyright Interarbor Solutions, LLC, 2005-2013. All rights reserved.

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