Lead generation is a crucial component of any go-to-market strategy. Often an afterthought, it is nice to see that it is increasingly becoming a “boardroom issue.”
While it’s good news that it’s getting both more attention and, more importantly resources, I’ve found that there are still a lot of perceptions about what it takes to build a successful approach. Lead generation can be a complex undertaking, and when managed effectively it is a huge lever for growth.
More leads means more sales
A couple of years ago I wrote a post highlighting the problems that present themselves when companies implement an effective lead generation process for the first time. While the natural expectation of increased lead generation is that it will (immediately) lead to more sales, that is often not what happens.
The problem is that most sales approaches implemented by companies aren’t designed to support an effective B2B lead generation program. An effective program creates engagement earlier in the buying cycle. Oftentimes, needs and budgets haven’t been established.
When leads start flowing in they get turned over to salespeople too soon and the sales process gets overwhelmed. Salespeople get bogged down chasing leads that aren’t ready for salespeople; and what could have easily been a very successful program gets marked as a failure.
It is critical that you develop a highly aligned marketing – lead generation – sales process to drive sales growth. You must:
- Create clear definitions for marketing qualified and sales quailed leads.
- Define a clear lead management process.
- Implement lead nurturing for leads that are not sales ready.
Only focus on developing qualified leads
When I started my first B2B sales organization in 1994 I remember spending a tremendous amount of time defining specifically who we wanted to focus on. We then used this customer profile to define what a lead was. The reality is that I was creating the definition for a sales qualified lead (SQL), not a lead.
In 1994 (and even, maybe, in 2008) mid-sized organizations couldn’t really afford to differentiate between their lead definition and their SQL definition. Managing leads back then was an expensive process. The only way you could actually qualify them was to put people (typically salespeople) on the effort. This was not only expensive, but time consuming as well.
Today, with utilizing Inbound Marketing methodologies the cost of managing leads is virtually zero. In 1994 we cast very narrow nets because we couldn’t afford managing leads that didn’t fit (and every incremental lead had a cost). This is one of the primary reasons that mid-sized companies never really had effective lead generation programs, and therefore struggled to gain predictable sales growth.
While you still need to pay attention to who you are trying to attract, you not only can, but should cast a wider net at the top of the funnel. An effective lead management process then works to separate qualified leads from non-qualified leads, and the net result is a much larger database of qualified prospects.
A lead means they’re ready to buy
I admit it. When I’m flipping through the channels and Glengarry Glen Ross comes on I can’t help but stop and watch it for at least a few minutes. And I love the scene with Jack Lemmon and Kevin Spacey (yes, I like Alec Baldwin’s ABC scene as well), when Lemmon laments that Spacey won’t ever give him the “good leads.”
A major cause of failure in lead generation processes is the misperception that a lead means someone who is ready to buy. The reality is that most leads never buy and don’t even enter a sales cycle with you (of course, the lack of a lead nurturing process is an important part of why).
People download content for their reasons not yours. That lead represents an opportunity for you, but you must continue to earn their attention, demonstrate your relevance and cultivate them if you want them to buy from you in the future.
Salespeople should generate their own leads
This is an oldie and a goodie. Far too many companies want their salespeople to be great prospectors, tremendous communicators and prodigious closers. “Wow!” I think. Should they have pet unicorns as well?
If predictable and sustainable revenue growth is high on your priority list then specializing your approach should be an important initiative. When you separate lead generation and management from actual selling you:
- Dramatically increase the success rate in hiring
- Eliminate capacity barriers
- Lower your overall sales costs
- Enhance productivity and the overall effectiveness of your sales process.
The Only Measurement That Matters Is Closed Sales
Too often the only measurement that senior executives (especially entrepreneurs) pay attention to is new revenue or sales. The fastest way to destroy an effective lead generation program is to jump to closed sales as the key metric too early.
When you do that, you incentivize poor behaviors and, worse, you hide flaws in your marketing and sales process that, if fixed, would give you the very results you desire.
There are nine measurements you should use when judging a lead generation effort. When these metrics are tracked, they allow you to diagnose and improve your results consistently.