Eight Critical Success Factors for Lead Generation – ReachForce Book Club
Thursday, November 13th, 2008If you’ve been doing B2B Marketing for any length of time you know who Brian Carroll is. If you don’t know who he is, you should. His eBook, Eight Critical Success Factors for Lead Generation, is a must read for “lead generation specialists committed to the long-term proposition that digging for leads, educating prospects, navigating the nuances of the complex sale and creating new, high-level return on investment is what has brought lead generation to the position it enjoys in the marketing hierarchy today”.
I read this eBook a couple of years ago but I was due a refresher. While all 8 factors are important to lead generation success, I pulled out a few things we could all benefit from doing or ensuring on a more regular basis. My summary and highlights by no means replaces reading the eBook.
- Remember you are creating conversations, not campaigns – “Companies don’t buy, people do.” With each lead generation initiative we are developing an ongoing relationship with the prospect. We are educating and providing value with each touch. Or at least we should be.
- Be sure you have identified an Ideal Customer Profile before getting started – we’ve talked about personas many times on The B2B Lead. Building out the ideal customer profile makes everyone’s job easier. Why wouldn’t you do it?
- Universal Lead Definition – it’s key that both Sales and Marketing agree on this. “There is consensus that sales functionaries fail to act on nearly 80% of the leads they get, largely because most of the leads aren’t qualified, or because appropriate buyers haven’t been identified and targeted.”
- Your database – your most valuable marketing asset. “The properly designed and well-maintained database is the hub of all lead generation activity and communication.”
- Lead nurturing – we all know it takes multiple touches to turn a contact to a lead and a lead to a real prospect. “Lead nurturing is not a single marketing campaign, but rather a series of steps and communication tactics with the objective of developing and building a relationship with the potential customer.” Automation tools make this easier than ever. No more excuses to not nurturing.
This is only a few highlights from the eBook, now go read it yourself if you haven’t already. If nothing else, the pictures/diagrams are worth your time.
Brian Carroll, CEO of InTouch, Inc. part of the MECLABS Group that owns MarketingExperiments and MarketingSherpa and author of Lead Generation for the Complex Sale (McGraw-Hill 2006) and the B2B Lead Generation Blog with expertise related to B2B marketing, lead generation and complex sales.
Once you’re done with this one go ahead and download next week’s eBook – HubSpot’s Get Found Online. We’ll be chatting about it next Thursday here on The B2B Lead.
The Integrated Revenue Cycle: A New Model for Sales and Marketing - B2B Marketing and Sales Tip #149
Tuesday, September 16th, 2008Written by Jon Miller, author of the Modern B2B Marketing blog and VP of Marketing for marketing automation software company Marketo.
There’s always been a lot of drama around how marketing can best contribute to and improve the sales cycle. In fact, one common way to measure the effectiveness of a new marketing initiative is by looking for improvements in the sales cycle. Businesses have always focused on the sales cycle, so that’s the way to go, right? Wrong!
Companies need to stop thinking only about the sales cycle and instead focus on what I call the “Revenue Cycle,” which starts from the day you first meet a prospect and continues through the sale and beyond to the customer relationship. The old model of a linear handoff from marketing to sales must give way to an intertwined model where both organizations jointly own prospect relationships and coordinate their activities. To use an analogy, imagine a fighter jet that first ran with just the left engine, then turned that engine off and lit up the right engine. That’s pretty inefficient compared to lighting both engines and going full speed!
Before defining the revenue cycle in more depth, it is worth examining why the traditional “sales cycle” is the wrong model for businesses to follow. The primary reason is that the sales cycle looks at only a portion of the complete revenue process, and this presents two main problems:
- Looking at sales alone as the predictor of revenue is misleading – with sales only, companies can’t manage and guide growth beyond the current or subsequent quarter. The Sales cycle can usually predict revenue in the short term, but because the sales forecast is based on what a specific account will do at a specific time, it becomes increasingly inaccurate for predicting future revenue. Asking the sales organization — which by definition is focused on revenue in the near term — to predict revenue in future quarters is typically highly misleading. For this, a company should look to the function that is inherently focused on the long term: the marketing organization.
- Inefficiencies are killing productivity and marketing budgets – without the right processes in place, sales is less effective and companies are wasting marketing budgets. The traditional model of a sales cycle that begins when sales accepts a marketing lead or contacts a prospect directly results in waste and inefficiency. It means as much as 50% of sales time is spent on unproductive prospecting, while reps simultaneously ignore 80% of marketing leads. We’ve estimated that the resulting lost sales productivity and wasted marketing budget costs companies at least $1 trillion a year. The sales cycle mentality also ignores the fact that throughout the customer lifecycle (before, during, and after sales interacts with a prospect or customer), marketing has been and will continue to touch the prospect with marketing messages via the website, campaigns, advertising, and PR.
So how do you start driving your business by managing the Revenue Cycle? The Revenue Cycle requires coordinating marketing and sales activities throughout the entire cycle to generate maximum impact. The key is to realize that marketing and sales bring different strengths to the process. Marketing brings a long-term view, sales brings an action-oriented view. Marketing is good at one-to-many communications, automated processes, and dealing with lots of data; sales is good at building personal relationships and leveraging the human touch.
The Revenue Cycle must start from the day a company first meets a prospect and continue through the sale and beyond to the customer relationship. As marketing and sales coordinate their activities as part of a unified Revenue Cycle, companies will get better at lead scoring and properly identifying and prioritizing opportunities. That creates better quality leads that result in easier and better quality sales cycles, with more wins and ultimately more revenue. While there will still be a time when primary ownership of a lead shifts, the Revenue Cycle eliminates the “handoff” from marketing to sales. Instead, both functions should be engaged in the right way throughout the entire Revenue Cycle: lead nurturing campaigns can come on behalf of the sales rep, marketing messages and the website can continue to support the sales process once sales does engage, and sales leads that go cold can be recycled back to marketing. With marketing and sales acting as equally important drivers of revenue, companies can gain a picture of the complete revenue process, ensuring that leads are properly nurtured and do not fall out of the cycle midway and get lost.
Of course, truly replacing the sales cycle with a coordinated Revenue Cycle is easier said than done, but the benefits are clear: increased sales productivity, greater return on marketing spending, and better visibility into the long-term performance and health of the business. What company doesn’t want to be able to better predict revenue and grow their business? The shift won’t happen overnight, but the first step is changing our thinking and embracing the new model: the Revenue Cycle.
For more tips like this one, download ReachForce’s eBook on 10 Tips for Marketing and Sales Alignment co-sponsored by Marketo.
Marketing Metrics that Drive Sales - B2B Marketing and Sales Tip #147
Wednesday, September 10th, 2008B2B marketing is all about driving sales, right? The most effective teams know that alignment of marketing and sales is a requirement for productive lead generation and customer growth.
We’ve had sales pipeline metrics in place forever, I sometimes wonder why we as Marketers got to skate along all this time with no accountability…that’s a post for another day maybe…
With today’s sales force automation and marketing automation solutions, we as Marketers are now able to prove our worth with every campaign or program we launch.
Here’s a few metrics we here at ReachForce track to ensure we are driving valuable sales activity and customer growth.
- # of net new companies from our target market sweet spots are added to the marketing mix each week
- # of net new contacts (right role, not just anyone) from our target market sweet spots are added to the marketing mix each week
- # of contacts being touched with a marketing message each week; net new contacts vs. those in nurture programs (and of course, we track opens and click throughs)
- # of inbound requests
- # of people hitting a landing page, then jumping to corporate site for product/service info. (we do newsletter and search engine advertising driving people to best practice content accessible via a landing page)
- # of people originating at The B2B Lead (ReachForce blog) and jumping to the ReachForce corporate site (product pages, solution pages)
- # of new sales meetings set from marketing lead generation programs
- # of marketing leads moved to the qualification stage of our sales pipeline
- # of marketing leads moving to a proposal, and of course closing
Once a new customer is onboard I then go back and identify what activities were involved in moving this lead to being a new customer so I can be sure to do more of it.
Now of course there is a list of metrics similar to this for each initiative you take on. It’s always important to outline goals and expectations of each program so that you are sure to spend your time and resources on the best producing programs.
Do you measure anything not on this list? If so, please share.
Practical Strategies to Building Sales-Marketing Alignment - B2B Marketing and Sales Tip #146
Tuesday, September 9th, 2008Written by Jon Miller, author of the Modern B2B Marketing blog and VP of Marketing for lead management software company Marketo.
I recently wrote about why sales and marketing can’t get along. Here are some practical tips to start bridging the gap!
1. Model the entire revenue cycle. As opposed to a standalone sales cycle, focus on an integrated revenue cycle that starts from the day you first meet a prospect and continues through the sale and beyond to the customer relationship. This helps each team understand what the other is doing, and how their actions help facilitate revenue.
2. Develop a common vocabulary. Part of an integrated revenue cycle is common definitions for each stage. When marketing sits down with sales and says, “what is the definition of a good sales lead, and how can we help?” the dynamic between the two departments changes. With the definition of sales-ready in hand, marketing can begin rebuilding trust by delivering leads that meet that definition. This common language and metrics is essential for communication between the functions.
3. Look for operational disconnects. Too often, sales energy and promotions are focused in a different direction than marketing’s most recent campaigns. In some cases, they can even be in conflict! In one example, the sales team had an incentive to sell a product that marketing was planning to discontinue in the next month. Make sure that initiatives and promotions are aligned by developing plans jointly and meeting monthly or at least quarterly.
4. Create a closed-loop reporting process. Marketing needs to have a way to follow-up with sales to see how well leads are performing. This can be a field in the CRM system, a regular call, or even an automated survey. Just make sure it’s easy for the rep to respond. It can be as basic as sending the rep an email two weeks after receiving a lead with the subject “Was lead ABC good?” This way, they can simply reply “Yes” or “No”, which they can easily do on their Blackberry or in a hotel room. Closing the loop like this can help tune lead generation efforts, and is an important way to take qualified prospects that are not yet sales ready and recycle them back into marketing for lead nurturing.
5. Share accountability between the teams. Marketing is a very measurable process, but the results are head to measure; it’s easy to measure Sales outcomes but Sales activity is hard to measure. As a result, compensation and rewards tend to be very different, which creates further problems. So be sure to review how each team is compensated and rewarded to ensure alignment. (One typical disconnect: marketing focuses on the number of new deals while sales is focused on the amount and size of the total pipeline.) The better your ability to measure marketing ROI, the easier it is to bridge this gap.
6. Foster respect and trust. Perhaps most importantly, in particular, building alignment between marketing and sales organizations starts with a common set of values and shared beliefs. If the two functions don’t fundamentally believe the other has the same set of goals in mind, it will be much more difficult to drive alignment. This is rooted in good and regular communication, but it can be challenging to repair years of miscommunication all at once. Start by focusing on small wins (for example, look for a particular rep who closed a big deal because of a marketing lead) and promote the result aggressively. By having a “victory parade” for small wins, you will begin the process of better communication and trust.
Use Lead Scoring to Identify Sales-Ready Leads - B2B Marketing and Sales Tip #140
Friday, August 15th, 2008Written by Jon Miller, author of the Modern B2B Marketing blog and VP of Marketing for lead management software company, Marketo
Most leads from B2B marketing campaigns are still researching. Prematurely passing these early leads to sales only annoys the buyer and makes sales even less likely to follow-up on marketing leads. This means the majority of inquiries require further lead nurturing before they become sales ready, so marketers also need the ability to know when to try to nudge the prospect to the next stage and when to pull back and give the prospect some space.
This is where lead scoring comes in. Lead scoring is the process of determining a prospect’s level of interest in your solution (engagement), as well as your interest in a prospect (demographics targeting). When used effectively, lead scoring means you will pass fewer, but higher quality, leads to sales. By not wasting sales time on low quality leads, reps can focus on just the high quality leads — meaning wins rates and sales productivity go up. In fact, as little as a 10% increase in lead quality can generate a 40% increase in sales productivity. In a world where the sales department costs equal 20 or 30% of total revenue, this kind of improvement means a dramatic impact on the bottom line.
How can you use lead scoring to achieve this kind of benefit for your organization?
First of all, too many companies use only basic demographic data (e.g. title, company size, etc.) in scoring. This is useful, but demographic data only tell how interested you are in the prospect—and nothing about how interested the prospect is in you. Even BANT criteria (budget, authority, timing, and need) have limited usefulness since buyers’ answers to those questions are notoriously inaccurate, and as we all know, people’s actions speak louder than their words. This means you should also track a lead’s behaviors so you can you measure their interest and engagement in your solution.
Begin by monitoring and tracking online behaviors, such as email responses, completed forms, and Web site visits. You can do this manually with web analytics, or automate the process using marketing automation software. Assign a point value to each, just as you would assign a value to each job title. Certain behaviors – such as using your company brand name in a search, visiting your pricing page, or returning frequently to your site – indicate higher readiness to buy, so assign even higher weights to those behaviors. Since B2B purchases typically involve 6 to 21 different people, add up the scores for each contact at a given company to measure the total level of engagement for that organization. Finally, be sure to lower the score over time if engagement goes down.
Review the point values with the sales team, and decide what score indicates sales-readiness. If the sales team determines a prospect is not yet ready, recycle the lead back to marketing for additional nurturing. Finally, be sure to close the loop and refine your scoring rules and point values over time for continuous improvement.
Want more details? Here’s a link to a free eBook from Marketo called Best Practices in Lead Scoring.
Building and Measuring Lead Nurturing Programs - B2B Marketing and Sales Tip #126
Tuesday, July 22nd, 2008As we acquire new leads and market to them we quickly see leads move into smaller, more segmented groups. Some take the hook you’ve put out there and ask for more, there’s some that act interested but don’t commit to anything, and there’s those that are radio silent and give you no indication of real life.
Each group now needs a different kind of follow up. The first group is ready for another targeted marketing program offering them another opportunity to engage. And those that didn’t respond might be ready for a slower moving nurture program. Maybe your message missed with these people, a nurture program is a good place to test messaging. Or maybe you are targeting the wrong person and they don’t care what you have to say or what we you are offering. (You’re wasting your time with these people but you don’t know it yet. )
Here are a few tips to building and measuring segmented lead nurturing programs.
(If you’re lost, don’t worry there’s marketing automation folks like Vtrenz, Eloqua, Marketo and Manticore that can help you automate the execution of all of these different programs.)
- Make sure Marketing and Sales have a clear understanding of what a lead is and what a sales-ready lead is. You have to start here. Marketing needs to know what they are looking for and Sales wants to know what they are getting.
- Divide your marketing database into 2 initial groups, active leads (people who have responded or engaged in the past) and inactive leads (people that have never responded to any outreach communication from your company). If you are an Eloqua customer, they have a report that will give you this information. Understand if there are any patterns among those that are active, if so, be sure to consider this when building out your nurture programs. Remember the goal of nurturing is to move currently active leads to the top of the sales funnel and move inactive leads to an active status.
- Measure and track movement in the nurturing cycles. As leads/prospects respond, use this data to determine next steps. You can confirm interest by reaching out to them again with a similar message and different offer or call to action. If they respond again, they might be ready for the next step in your nurturing cycle. If they don’t respond, continue to try different offers or messaging.
- Develop a scoring system that enables you to determine when leads are sales ready. Assign different values to each kind of touch. For example, a conversation had by telemarketing that better qualifies a lead might get a score of 10 while an opened email might get a 3. Once a lead reaches a score agreed upon by Sales, then the lead is ready to be passed on.
- Don’t forget about the ones that have moved on. Sometimes a prospect gives off all the right signals that they are ready to engage on a different level but once handed over to Sales they clam up. Make sure these people don’t get lost in the shuffle. It’s ok for a lead/prospect to move back and forth between Sales and Marketing.
- Determine when it’s time to throw in the towel. There are people in every marketing database that continue to hang around for no reason. What are we holding on to here? Before completely throwing these people out, try and determine why they aren’t responding to you.
- Are they the right buyer for your product or service?
- How long ago was this lead created? Has the person possibly moved up or on?
- Are they not a good fit for your offering?
Remember - keeping your nurturing programs focused on the most suitable prospects will help to ensure the success of your program.
Easy to Take Lead Scoring Surveys Help Drive High Response Rates - B2B Marketing and Sales Tip #104
Monday, June 9th, 2008Written by Cody Young, ReachForce Customer Success Manager
When developing lead scoring survey questions that effectively determine need, interest, timing and budget, remember these things:
- Don’t over use industry jargon and acronyms when crafting the questions
- Use simple and direct language
- Avoid use of passive messaging and sales pitches
- Offer as many multiple choice questions as possible
- Randomize presentation of multiple choices to avoid bias
- Design questions to maximize meaningful cross tab analysis
- Use as few questions as possible
For more info on lead scoring surveys check out my last post, Using Surveys for Lead Scoring.
Using Surveys for Lead Scoring - B2B Marketing and Sales Tip #99
Wednesday, May 14th, 2008Written by Cody Young, ReachForce Customer Success Manager
Lead Scoring appears to be the newest tactic Marketers are using to better identify warm to hot leads for Sales. Marketing vendors like Marketo and Eloqua are promoting lead rating and lead scoring as a means to increase sales effectiveness and accelerate typical sales cycles. Both are measuring a contact’s interaction behaviors with marketing activities. But should a contact really be considered a hot lead if they open a few emails and visit your website a time or two? I think our Sales team might disagree here.
At ReachForce, we are doing a little lead scoring of our own. Instead of analyzing prospect behaviors, we are going directly to them and asking them to participate in a survey. By gathering qualifying information directly from the prospect, our customers are able to better target their messaging at these new prospects. By enabling them to get to the right buyers, in the right companies, with the right message, they are seeing increased marketing results and sales conversions.
Here are few tips we share with our customers when we’re building out a lead scoring survey.
Lead Scoring surveys can quickly:
- Qualify a company as a user of a certain technology or application – This type of question is to confirm if a prospect organization uses something that either compliments or competes with the survey sponsor’s offering.
- Find out respondent status: decision maker, a part of a decision making team or a secondary influencer – This type of question is useful when setting the stage for a sales call or marketing campaign so messaging can be made as relevant and personalized as possible.
- Find out how well the top 2‐3 product or service “key values” are recognized by each respondent – A “key value” is something that makes an offering better, unique or uncommonly relevant to the prospect. This type of question is used to find out if they will “get” your value proposition, or if education or special messaging is required.
- Measure how important key values are to each respondent – This follow up to Q3 is used to find out how important the respondent thinks the sponsor’s key values are. Combined scores to this set of questions are used to determine degree of interest and help make sales and marketing messaging relevant and personal when following up on the lead.
- Determine budget – This type of question is used to pinpoint how much the respondents’ organization spends (and by implication would expect to spend next time) on offerings similar to what the sponsor sells. Paying close attention to scores that are too low help sales and marketing teams prioritize.
- Confirm plan – This type of question helps find out when or how often the respondent is in the market for what the survey sponsor is selling. Questions like this can also be centered on finding trigger events (audits, budget planning, corporate initiatives) that create sales opportunity.
- Establish time line or “window of sales opportunity” – By combining the responses to “Confirm plan” and this type of question, the result is normally a reliable indication of when the respondent’s organization will begin the buying cycle for what the survey sponsor is selling.
The lead score you end up with for each prospect should help you to determine if the prospect can be immediately handed off to sales or put into a marketing campaign for further nurturing.
Should Leads be Scored Like FICO? - B2B Marketing and Sales Tip #73
Thursday, February 21st, 2008Contributed by Cody Young, ReachForce Consultant
I came across an interesting post by Jeff Liebl on Performance Insider blog. The post proposed the notion of have a third-party scoring system for leads similar to FICO scoring. The potential pitfalls expressed in Jeff’s write-up about buying leads from online sources are well founded. And while conversation about scoring lead data in a way similar to FICO is interesting, the real value I see is the more practical and tactical thoughts he provokes about lead data quality in general.
First and foremost, the concept of establishing FICO-like rules for scoring individual lead quality while lists are being bought and sold shouldn’t be an edict for marketers to sit and wait for. Market forces are already making it happen in the B2B space (at companies like ReachForce) – and yes, it is having real effect on price models and competition between lead source vendors.
The most important element of any marketing effort is specifying the target – and you can’t really do that effectively by just ‘buying a list.’ Today’s marketing must be managed by understanding how sales funnels work and how buyers buy.
This puts a very special responsibility in the hands of all marketers to view this as filling up on ‘funnel fuel’ –not ‘list buying.’ Sadly, Jeff’s spot-on reference to “numerous reports of fraudulent and bad-quality leads” is a disturbing indicator that too many are still in line with the wasteful standard that marketing’s job is to buy lists and busy themselves sending out emails and letters for 2% response rates.
Buying data to feed sales funnels can best be compared to buying fuel – and from sludgy-crude to jet fuel, a wide range of grades exist. That being said, it should not surprise anyone that as new sales and marketing automation engines expose better ways to find, keep and grow customers, jet fuel is going to win the race every time.
Once high quality funnel fuel is secured, predictive modeling does not have to be a complex, budget busting ordeal. A simple way to start is by ranking a single-value to measure each prospect in a simple, but highly relevant way. These are what Dr. Eric Siegel calls ‘predictors’ in his short but informative article entitled Predictive Analytics with Data Mining: How It Works.
He draws a simple example using “recency” as a predictor (based on how long it’s been since a customer’s last purchase) and assigns higher point values for more recent customers. This simple analysis drives a very obvious prediction (you can probably guess) that contacting the customers in order of recency – calling the high scores first and the low score last – will result in better response rates.
Expanding on this, other predictive indicators and rules can be introduced to formulate smarter and smarter models as you go. The next example is to combine two predictors into a formula: recency + personal income. And if one of the predictors is more important to you than the other (by rule) then its weight is adjusted accordingly – e.g. 2 x recency + personal income.
Once you are able to score your database this way (or just parts of it for starters) using predictors that best fit your needs, the ability to target and finesse top scoring leads with highly relevant and personalized communication is enhanced – thus, increasing the probability that you can drive a prospect’s behavior and not just predict it (as with FICO scores).
A lot of the better marketers I know like this approach because it is not that complex and is the least costly, most deliberate way to drive sales revenue. After all, it really just keys on another formula that comes to mind: 2 x quality funnel fuel + targeted and personalized communications = high response.
B2B Marketing and Sales Tip #58 - Get to Know Your B2B Technical Buyer
Monday, January 21st, 2008Attention Conservation Notice: The following post highlights research on B2B Technical Buyers and provides a quick overview of how to develop a persona for this role.
Building an effective B2B target database takes a lot more than just identifying the right market segment, company size, and target title. Before you get started building your database, it’s important to get to know the different roles, responsibilities and characteristics of each person involved in the buying process.
Today, we take a look at the B2B Technical Buyer – the person within a company or organization who is responsible for ensuring a solution meets the technical requirements of the company. For technology purchases this could be an IT professional. For CRM software it might be a Sales or Marketing professional. Depending upon the size of the organization, these individuals may or may not have final financial approval but they do hold significant influence over the purchase.
Here’s what a recent MarketingSherpa Benchmark Study says about this role:
a. white papers, product literature and industry articles as their top sources for product information.
b. their top search engine is Google. Depending upon the source of data, you’ll hear that anywhere from 80 to 98% of them start their purchase process on Google.
c. 64% of them shortlisted a product based on a timely sales call.
What does your technical buyer look like? For my network management software company, we built a persona profile that described his or her job, life and daily concerns. We did this by describing our best customers. We even gave him a name—Ajay—and a face by adding a photo. Now, whenever I write literature or design a campaign, I always think of Ajay and I’m better able to target the campaign using the right messages and media. Here are a few items to think of when you are building your own:
Name:
Photo:
Geographic:
Gender:
Age:
Annual Income:
Marital Status:
Number of Children:
Education:
Work/Life Experience
Psychographics:
Current Work Environment:
Mobile Devices:
Presence in the Buying Cycle:
For more on this topic, download the free B2B Marketing ebook called Funnelnomics from ReachForce.
