Lead Generation – What’s in a Lead Definition

Everyone knows what a closed sale is! It is real and measurable. But can anyone say with certainty that there is a universal understanding on what a “Lead” is?

Consider the following progression from simple leads to more complex qualified leads:

1)      Individual name/title, company, phone number/email.

2)      Individual name filtered by self-identifying action via a website download, social media, participation in a trade show, etc.

3)      Individual who has committed to an appointment with a sales rep to hear “the pitch”.

4)      Individual who listens to “the pitch” and wants to learn more.

5)      Individual who in speaking with a lead generator/business development/sales rep reveals details about their interest, needs, initiatives, and timeframes.

6)      Individual who has revealed they are buying a solution and are considering purchasing yours.

For Business Development, Marketing, and Sales professionals, what is apparent is that there is a “pipeline” for leads, just as there is a pipeline for sales opportunities.  Both pipelines are important to engage, follow-up, nurture, and track.  It is crucial to establish a working definition so that you can avoid duplication of effort and prevent losing touch with prospects.

Lead Generation Basics – What goes into figuring an acceptable cost per lead?

Most Sales and Marketing organizations take a quick and dirty approach to calculating a cost per lead figure. First, they look at the average value of a sale, and then they select an arbitrary percentage of that number to come to a cost per lead figure.  Often, this figure becomes a never changing amount in the collective minds of the organization, even though market dynamics and product offerings are ever changing.

 

For deeper insight into cost per lead, consider the following:

 

  • Is the product/service/solution you are selling a commodity or a unique/customizable offering?
    • If a commodity = less complexity, less cost per lead
    • If customizable solution = more complexity, more cost per lead

 

  • What is the solution cost relative to the size of the target organization?
    • A $100k price tag for a multi-million dollar a year firm is not a difficult spend and may indicate a smaller cost per lead
    • But for a smaller company the same price could be a significant expense resulting in a longer sales cycle and higher cost per lead

 

  • Is the solution one that will affect a few or many in the organization?
    • Few = not so many opinions, lower cost per lead
    • Many = more opinions, more evaluations, more time to sale, higher cost per lead

 

  • What is the personality type of the decision-makers?
    • Analytical thinking people like CFOs, controllers, and engineers tend to stretch out the sales process, more cost per lead
    • Less analytical people tend to make quicker decisions, less cost per lead

 

  • Strategic solution vs. Tactical solution
    • This could go either way.  For instance, a strategic solution could have a long term and wide ranging effect indicating more evaluation of risk than a tactical solution.  But, a strategic solution might also be easier to exit or adapt to change than a tactical or point solution.

 

It is no surprise that complicated solutions or market trends or the solution price tag will stretch out the sales cycle, but it also has an impact on how much you should budget for lead generation.

 

Bridging Multi Channel Marketing and Sales Lead Generation

Bridging Multi Channel Marketing and Sales Lead Generation

In the 21st century, companies that are start-up, early stage or well established are faced with myriad ways in which to apply their marketing efforts and hard earned dollars.  Below is just a short list of channels:

  • Direct mail/email campaigns.
  • Search Engine Marketing and SEO.
  • Industry events and conferences.
  • Interactive/social media.
  • Press releases
  • …and the list goes on.

The message in all this is that you invest your time, effort and dollars in campaigns that are designed to fill your sales pipeline.  But in order for that to happen, applying the above strategies requires your prospects to do something first.  The measure of how good your marketing campaigns are is how often people will click on a link or call or connect when they see or hear an advertisement.   Hopefully your messages are inspirational enough to make the prospect take that next step.  But hope and wait are passive strategies.

The responses that do come in need a response mechanism which is likely your inside sales team who can then follow up and further qualify.  These passive marketing campaigns create further awareness and that does soften up the battlefield for B2B telemarketing.  More times than not, prospects need to hear from you or be touched multiple times before they make contact.

B2B telemarketing or telequalifcation is a proactive strategy that complements your marketing strategies.   Both must be done in concert for true sales lead generation with the best qualified leads moving through the pipeline and developing into closed sales that deliver you revenue.

Bottom-line, it’s not just marketing nor just sales.  It’s a concerted and effective handoff between the two groups for optimal results.  We’ll take the active approach for you and turn passive interest into qualified interest.  We’ll bridge the marketing to sales gap.

 

Social Marketing Leads have a Short Shelf Life

Leads that are generated from your website have a very, very short life span and need to be dealt with within the first 5 minutes of their arrival.

That’s not a very big window of opportunity, but you are 4 times more likely to successfully qualify your lead than if you called back between 5 and 10 minutes. If you call within those first 5 minutes rather than waiting 30 minutes to get in contact, you are 21 times more likely to qualify your lead than if you waited. Astounding!

Do you contact your new enquiries back within 5 minutes or are you of the idea that you don’t want to look desperate so you’ll wait a couple of hours and call them back later, possibly making yourself look busier than maybe you are?

I have taken this information from a good book by Geoffrey James. Called “How to Say It: Business to Business Selling: Power Words and Strategies from the World’s Top Sales Experts.”

Lead Generation Basics – The Right Time

We have all heard the familiar refrain about life — “Timing is everything!” Well, it is the same when it comes to volume targeted calling. Every time you pick up the phone to call, you have to anticipate connecting with that opportunity that makes all the cold calling work worth the effort.  Some call this luck.

But, success on a long term basis is a result of making your own luck.  Regarding cold calling, this means pitching the Right Message to the Right Targets and catching them at the Right Time.  How do you maximize the probability of connecting with people who will end up purchasing your product or service?

  • Aggressively make calls 100-150 per 8 hour day if you are manually dialing, as many as 200 or more with an automated dialing system.  Fewer than this, you are not maximizing your probabilities. More than this, you are likely not talking to anyone.
  • Do not confuse number of dials with progress if the resulting number of conversations is in the single digits per week.  If you are not talking to people, enough people, you will never uncover a need that will lead to an opportunity.
  • Do not dismiss initial resistance with not being the “Right Time”.  Just because you do not learn of the existence of an active budgeted initiative on a cold call, it does not mean the prospect will not buy.  Most prospects have money and their company’s priorities are often changeable, so money can be moved to cover any purchase if compelling enough.

Lead Generation Basics – The Right Targets

It is a familiar refrain of sales people and marketers everywhere. “I need to get in front of the right people!” The “right” people of course are those decision makers and the people who influence the decision makers who can lead you to the sale.  Here are a few tips that can help you become more efficient in your prospecting efforts:

  • Outline the profile of a customer and work backward to identify a list of target companies with the same attributes; annual sales revenue, number of employees, industry, and geography are common criteria.
  • Define the stakeholders within the target companies, their titles, roles, and level of influence.
  • Remember that no list is perfect and the best way to find the right person is to talk with people, even if they are outside the roles you are trying to engage.  There is no magic list despite what you may hear.
  • Be open to revising your original assumptions about the best targets; while there are trends in the ways companies are structured and behave, there are plenty of unique companies doing it their own way.  Remaining flexible will prevent you from missing real opportunities.

Lead Generation Basics – The Right Message

No prospect just picking up a ringing telephone wants to listen to a cold caller carry on about their company, product, or service. The typical cold call is short (less than 5 minutes, more than 2 minutes if you are lucky), so the caller must capture attention quickly and establish why it is important for the prospect to listen.

  • Your value proposition must be stated clearly and confidently, preferably referencing a success story with an existing client to establish credibility.
  • Identify what topics or phrases excite the prospects you are trying to reach and engage with them in an unscripted conversation about these.
  • Pre-prepared scripts are useful tools but should act more as guidelines for discussion so they do not sound like the typical 6th grader delivering lines in the school play.

Cracking the code on the Right Message on a consistent basis may take a while and is likely to vary depending on the role of the individual prospect.  So keep calling and adapt your message to what resonates with your target prospects.

Accelerate the Sales Process and Achieve Your Sales Goals

When a sales organization misses their sales goals is it because they didn’t close the deals they had in their pipe or is it because they didn’t have enough quality opportunities in the pipe to begin with? The best way to accelerate your sales process and achieve your sales goals is to place high quality leads in the hands of your sales team.  Many organizations focus on the quantity of leads they generate versus the quality of the leads.  Certainly focusing purely on the quantity reduces the overall cost per lead on the front-end of the process however this approach generates a significant burden on the sales team by increasing the amount of time/cost it takes to sort through the “leads” to find the real opportunities if any to take to the next step.

Many lead generation outsourced vendors fail to ask one very important question in the development stage of a lead generation project.  That question is very basic and can only be answered by your sales team.  And that question is “what is your definition of a lead”?  Many outsourced vendors simply say we’ll get you X number of meetings for your sales team.  On the surface the number of meetings may sound great however if the individual you are meeting with does not have a need or interest in your offering it is a waste of time for your sales team and it will not help you achieve your sales goals.  So if you want to move more opportunities into your pipe quicker and achieve your sales goals focus on the quality of leads entering you pipeline and not the quantity.

Teleprospecting In The New Demand Waterfall Configuration: Old News/New News

This past May Sirius Decisions presented their new demand waterfall model. It was very well received at the annual conference. Where before it took a narrow approach to the sales funnel, the new approach showcases how inbound marketing, marketing automation and telemarketing intertwine with regard to demand generation. Of equal importance, it showcases how marketing and sales should be aligned, and how the funnel process integrates both fields.
At Good Leads we are glad to see that Sirius Decisions has in 2012 recognized the importance of outbound phone based business outreach. So that is the New News.  The Old News is that we have been offering a premium level of outbound business development (aka:teleprospecting) for a decade as this is Good Leads 10th Anniversary year.  We have much to add to this discussion and be glad to advise on your Sales and Marketing model and the respective alignment of the players. Here is the new Demand Waterfall:

 
Demand Water fall by Sirius Decisions

ASK THE EXPERT: Building That Pipeline

Between the global economy, the recession, the Internet’s effect on buyers’ access to information, new selling tools and applications, and the need for an optimized sales process, selling has changed more in the past five years than it has in the past 50 years.
In the context of technology sales, according to Dave Kurlan, best-selling author of Baseline Selling, “most companies haven’t changed their approach and still hope that their salespeople, who succeeded prior to the 2008 crash, will somehow get some momentum. But what worked in 2006 doesn’t work in 2012 and won’t work in the years to come.”
If you want to grow revenue, the best option is to invest in your selling machine in building a better pipeline.
Yet many young firms with limited budgets struggle with what their marketing options are and whether those choices are the most leveraged investment in building the pipeline.
For a threshold of understanding, let’s be clear on these terms and questions. What is a sales pipeline? What are my marketing options as a young company with limited budget?
In a summary format, a sales pipeline is a process of: Identification of suspects; Inquiry to them; Qualification of them; Presentation of your value proposition to them; and Commitment of the prospect to take the next step in the sales process-as you have defined it.
Continuing this theme, and another way of looking at it: The sales pipeline is a continuous flow of sales suspects that flow into your sales funnel where your sales qualification and selling process is instituted. These sales suspects, however they are identified, are from all marketing sources — inclusive of inbound requests, outbound calling, and referrals.
There are many sophisticated marketing scoring models and marketing automation tools, which  add great value, that are available once you have enough activity to warrant the need/cost of utilizing.
Net net, it is the process of moving people of interest (suspects) through your sales process to become a buyer.
So there are many marketing options and many choices as to how you choose to spend your marketing funds. Those options might be direct mail/email, search-engine marketing, interactive/social media, advertising, teleprospecting, analyst relations, media relations, events-networking.
And there are others.
At the risk of sounding “old school,” direct mail still works but I use it in very targeted campaigns.  Ideally, if funding permits, you would want to engage a mutli-channel approach to gain the merits of each approach and to leverage each other. These modalities can or should be done in concert with each other. As an example, following up with outbound phone callings after an email or direct mail effort increases your lead yield by 25+  percent.
So I will make a distinction about marketing modality choices that can be either passive or aggressive. Most of the marketing modality options go to “create brand or demand,” which should drive inbound inquires. So it’s a measure of how good your email blast is, as an example — will people click on the link when they see an advertisement? Will the call-to-action statement be inspirational enough to make the prospect call for information or go to the website to fill out an inquiry form?
Those choices are passive. You wait. As those leads go into your sales pipeline, these passive marketing options also create further awareness that can “soften up” the battlefield for the rest of the sales pipeline that can be furthered by outbound calling. By definition, an inside sales function are those folks who are typically calling by phone to qualify the inbound inquiries or find new suspects and qualify them.
Outbound calling or teleprospecting is considered an aggressive choice. My preference is that I want to leverage the awareness and branding campaigns and get on the phone and close sales from people who have shown interest or seek out new prospects, politely creating opportunity discussions.
Active calling creates the opportunity for the business suspect to provide immediate reaction to your inquiry — so you control your outcome by how much skilled labor you apply and the effectiveness of your phone-based articulation of your value proposition.
The options to provide your sales team with targeted, vetted selling opportunities as defined in your lead success criteria are many. Your choices should provide for a flow of leads through the pipeline.
I look forward to responding to your questions or comments on this topic.

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Bob Good is the founder and CEO of Good Leads, in Salem. Founded in 2002, Good Leads is an outsourced sales and marketing firm that specializes in warranted business introductions for technology centric firms and professional associations inclusive of healthcare IT, medical devices, clean tech and engineering and design companies.
With 30 years experience, Good speaks and consults on sales and marketing models for businesses, and holds graduate degrees from Wayne State University and Southern  New Hampshire  University and is a long-time board member of the  New Hampshire  High Technology Council, and serves as  New Hampshire’s Commercial Counsel to Canada.
He can be reached at Bob@Goodleads.com.