Let’s start with why lead generation is important
Lead generation is one of the top priorities for B2B businesses that want to grow. And rightly so. After all, there are typically three key steps to achieving that much sought after growth:
- Generate leads.
- Convert these leads into sales.
- Retain your customers and maximise their spend with you.
We may have deliberately over-simplified these complex and challenging areas to illustrate a point, but none the less at a basic level these are the only three ways to grow.
Most businesses find number three – maximising existing customer revenue – less challenging as they can successfully capitalise on most of the potential of their existing customers.
So generally to achieve growth, new-name new business is required i.e. you need to win business from companies that are not existing customers, and to win new customers you need sales leads.
How many leads are required?
Just how many leads are needed isn’t in itself always easy to quantify. Not all leads are equal; some are easier to close than others. A simple hierarchy of lead quality might be:
- Referrals are usually the best leads you can get. Your credibility has already been established and often the referral is to someone that needs your service so the timing is right.
- Inbound enquiries from your ideal target customers.
- Leads generated from outbound activity with your ideal target customers.
- All other leads that are not with your ideal target customers. Inbound, outbound, it doesn’t matter how they are generated, often you are simply not a good fit for each other.
Leads that are a poor fit consume valuable resource, rarely convert and often don’t last as customers if they do. They demotivate your team; sales lose faith in marketing and vice versa, and management lose faith in everyone.
Common mistakes in commissioning lead generation activity are:
- Focusing too heavily on lead quantity – putting metrics in place that put undue pressure on marketing/lead generation to focus on short term numbers rather than long term strategy.
- Not recognising that the value of a lead varies depending on how they are generated and ‘fit’ with your proposition.
- Underestimating the length of the buying cycle and therefore judging performance over too short a period.
Times have moved on. Too often, businesses’ sales and marketing have fallen behind.
There have been significant changes in business development for B2B businesses.
Salespeople have to contend with ever more knowledgeable buyers and ways to reach B2B buyers have changed. That isn’t to say that traditional lead generation techniques – direct mail, exhibitions, telemarketing – aren’t effective any more, they can be, but usually when used in a different way or more likely as part of an integrated marketing strategy.
The days of sales persuasion are largely passed. Modern B2B buyers are engaged; a subtle but significant difference.
Take telemarketing as an example; a traditional method for generating B2B sales leads and appointments. It used to be the role of the telemarketer to persuade the prospect to agree to an appointment with the Salesperson. The lead was then passed to the Salesperson to persuade the prospect to buy; even if they weren’t really that interested. Remember objection handling?
Is it any wonder that B2B buyers have changed the way they identify and evaluate potential suppliers?
This is the crux of the failure of many B2B lead generation campaigns.
If it is that simple, why haven’t businesses adapted their lead generation processes?
Some have. And it’s no coincidence these are the businesses that are achieving greater growth than their peers.
There are usually one or two common reasons that businesses haven’t adapted to this new paradigm.
Partly it’s a lack of understanding of just how much things have changed. That’s understandable. You run a successful business that you built from the ground up by winning customers. So why would you listen to someone that tells you that what you’ve previously done and had great success from can’t be repeated by someone else?
But the biggest challenge is it’s often a far bigger task than is realised, or that people want to commit to.
The requirements of modern sales and marketing are such that you need a broad array of assets, content, lead generation and lead nurturing mechanisms. You need a strategy set by someone who really understands modern buyers and what channels, tactics, technology and messages will engage them.
For many – too many – it’s far simpler to revert to type, set a lead generation brief based upon persuasion for a short term trial with the throw-away line let’s test this first, provided we get some good results we’ll then commit to doing all the other things that we know we should do. It’s a classic catch-22 situation.
Looking objectively, it doesn’t make sense, does it? By not doing the very things you know you should do in their entirety you’re decreasing your chance of success.
The irony is that the same people recognise that the success of their business is driven by striving to have the best across all other facets of their business; people, systems, process, customer service, solutions etc.
And it’s a self-perpetuating problem. Every failure to achieve ROI from lead generation decreases the willingness of the Directors to make the necessary investment – in time, commitment and budget – to break the cycle.
The opportunities for growth are there in most markets. Some businesses are thriving. Others are falling behind.
If you’re a business owner, the question may be whether you have the commitment to step out of your comfort zone and recognise that you may need external expertise to achieve the growth you desire.