By Gil Ben-Dov, Market2Lead
Will having too many leads hurt your business? At first glance, this may seem to be a ridiculous question, but having too many leads can waste company resources and also hold back a company’s growth. How is it possible for a company to be flush with leads and not do better in sales? The answer lies not with the quantity of the leads but with the quality. At the end of the day, the most important thing that comes from all of the lead generation and sales efforts is the number of completed sales. By flooding sales with too many leads, marketers are actually wasting their time, slowing salespeople down and keeping them from more productive work.
Each lead, whether valuable or not, needs to be assigned to a field salesperson, followed up on, manually qualified and sold to. Based on general industry knowledge, it takes an average of about seven phone calls to reach a prospect today. If we add up the cost of the salesperson’s time and the opportunity cost to the company, it becomes obvious that it is extremely expensive for sales to follow up on low-yield leads. Passing a large number of these leads to sales is indeed bad for business, yet this is exactly what many companies are doing. So how do you focus on the quality of leads and why is this so important?
One of our customers, deciding quantity over quality was no longer working, implemented our sales-driven lead generation methodology, in other terms: automated demand generation. This company was very new to outbound marketing campaigns and was mainly relying on inbound leads from third-party referral sites. People quickly discovered they were receiving poor quality data that was not very actionable. With the new approach, the sales team at this web application security company set the definition of a lead, so the marketing team could provide relevant, automated campaigns to them. With each contact, salespeople learned more about the prospects, getting closer to their business pain points and needs.
This approach has proven to be highly valuable and successful for companies of all sizes, small to large. It provides the sales force with the opportunity to have a more applicable discussion with the prospect. It also shows that you are taking the time to understand and address their needs, and it’s less intrusive to the prospect. Periodically engaging a lead with new, valid offers is much more effective than bombarding the person with multiple messages all at once. How does the sales-driven approach address the problems many companies face today when it comes to passing the most productive leads?
Two main factors contribute to this problem. The first is how we traditionally measure the effectiveness of marketing departments. It is rare that marketing is praised for producing fewer leads, even if they are of a higher caliber, so the tendency is to bulk up the lead count. And when the leads fail to produce sales, the standard marketing comeback is, “The sales team does not know how to sell.” This lack of measurability and accountability exacerbates the “too many leads” problem.
The second contributing factor is that the majority of companies do not have the processes in place to single out high-yield leads and nurture the lower-yield leads. Most companies lack the infrastructure to nurture prospects that have demonstrated interest in products and/or solutions but are not yet ready to purchase. After marketing’s initial attempt to convert these prospects into customers, those that have not been converted frequently lay fallow in a spreadsheet buried deep in the marketer’s hard drive. The industry best practice is to periodically engage the low-yield leads with new offers, such as white papers and webinars. This is where a sales-driven lead generation approach can really make a difference.
According to the vice president of sales for the web application security company, “Before implementing the automated demand generation solution, we sent raw responders directly to our sales force account and called them leads. With this new strategy, our sales team was able to define what a lead actually means to us. Because of this, the quality of the leads we have received has increased dramatically.”
What steps did this company take to make this solution valuable? A member of our customer account management team interviewed the marketing team as well as the outside and inside sales teams to determine the best lead-scoring methodology. They could decide how to separate the “tire kickers” from the leads they really wanted. They also discovered how to work with the marketing department to create the questions that could be easily presented to their prospects to derive the most important insights. Sales and marketing began to better understand how to leverage each other’s knowledge and expertise, so they could get the most out of their prospects.
Another very important step they took was ensuring they touched their prospects with the proper messages while moving them along the purchase cycle. This is an issue for most companies, which too often send irrelevant messages to prospects, potentially killing any interest in their products or solutions. It is critical to spend time reviewing your prospect list to see what offers individuals have responded to and what other messages they’ve received. This can help guarantee that a lead who is close to purchasing does not receive the same message as a newly acquired prospect who isn’t familiar with the company. Tailoring question sets, messages, and offers to each individual is one of the most important strategies behind the sales-driven lead generation approach.
Companies will soon begin to realize the benefits of this methodology with an increased conversion rate of the most productive and qualified leads. All of these interactions provide strategic value to companies by increasing mindshare and further cultivating the prospect’s interest, while gathering additional intelligence to sales. This activity will help turn low-yield leads into highly qualified leads. Only after a prospect has demonstrated the interest and the ability to purchase will the qualified lead be passed over to sales.
Not only does this lead-nurturing process increase the potency of leads, but also it makes sales more effective, as in the case of the web application security company. So the next time you find your company “has more leads than sales can handle” or is suffering from poor lead quality, it is time to look into building and enabling a better lead-nurturing process.