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Why Your Sales Force Needs Fewer Marketing Leads
Who’s Minding the Lead Farm?
Cahners Research has shown that 45% of qualified leads will end up buying a solution from
someone within a year.
Think of lead qualification as a funnel. Marketing pours raw, unfiltered leads from a
variety of sources into the top of the funnel to create an initial lead list.
Ideally, the lead list that emerges at the other end—ready for professional handling by a
lead-hungry sales force—is a steady supply of qualified leads, each with a defined process
and timeframe for buying.
Reality, unfortunately, rarely matches the ideal. All too often, no one is managing what
happens to marketing leads once they enter the funnel. Marketing, focusing on lead cost
instead of quality, thinks it has done its job simply by creating the unfiltered lead
list. No one contacts or qualifies the inquirers. No one augments the marketing leads with
demographic and firmographic data. No one nurtures long-term suspects into short-term
prospects. No one evaluates the effectiveness of the sources used to create the lead list.
In this garbage-in, garbage-out scenario, you can’t blame sales reps for ignoring this
type of lead list.
Who Should Process Leads?
A lead is a general classification of an individual with an actionable need for a product
or service. Short-term marketing leads, also called qualified sales opportunities, are
ready buyers that have the potential to close within one or two sales cycles.
Typically, only a small portion of freshly generated marketing leads should be put on the
short-term lead list. The root of the broken lead generation "system" described earlier is
that little or no effort has been made to determine whether each raw lead has any
potential at all, much less whether it is short-term or long-term.
Whose job is lead filtration, qualification and development? In our observation of how
hundreds of companies treat marketing leads, the bulk of the work overwhelmingly rests
with sales—and that is a recipe for failure. Even if marketing leads are pre-qualified,
sales people are notoriously poor in following up on all but the "hottest" of leads on a
lead list. In fact, experts say, sales does not follow up on more than 70% of leads
provided to them.
Management rightfully motivates and compensates sales people to focus on making the
immediate numbers, not on building a pipeline of prospects. To fully leverage the talents
of your sales force, don’t expect sales reps to filter a lead list, qualify the leads, and
then cultivate the long-term ones until they are ready buyers. They just won’t do it!
Traditional marketing departments are also not the best equipped for this important job.
They are filled with brand builders or communicators who do not possess lead management
skills and technology, or they are measured on "response rates" and
so-called "cost-per-lead," which are the wrong metrics.
In our experience, best practices suggest that a separate group, inside or outside the
company, needs to take control of the vital lead development function rather than simply
creating a generic lead list. Think of this group of specialists as lead farmers—they
qualify raw leads, nurture lukewarm prospects into the "hot" category, and turn the
developed leads over to the sales force for harvesting. Often this process takes months.
A developed lead is one that sets the stage for relationship selling. A lead "farmer"
equips the sales rep with in-depth knowledge about the prospect. With advance insight into
the prospect’s motivations, pain points and buying plans, the sales rep can engage the
prospect in a consultative conversation rather than launching into a cold-call
presentation or a discovery interview.
Turning Raw Leads into Real Opportunities: Don’t Give Up Too Soon!
The lead farmer has a challenging job. The starting point is usually an inquiry consisting
of a name, title, a company, a phone number or e-mail address. The lead farmer must have
the patience, discipline and skill to engage the inquirer in a conversation. This step
alone can take weeks or months.
Many of the best prospects turn out to be those who have been contacted five or six times
by voice-mail, e-mail and direct mailings over a period of months before a conversation
finally occurs. Executives often don’t respond until a need’s priority has escalated. The
lesson: Don’t give up too early on non-responsive marketing leads. Many will save your
e-mails or letters and will eventually self-qualify. Sometimes they respond to a letter or
e-mail from weeks earlier, or they call when the latest touch-point coincides with their
timing window.
After a dialog has been opened, the lead farmer begins probing, documenting, and
tracking—always with the aim of moving the leads further through the pipeline. The lead
farmer is patient, but persistent. He is also creative and informative. If he is perceived
as selling too hard, the potential buyers may be put off. If otherwise well-qualified
leads are stalled due to budgeting or other considerations, the specialist follows up
meticulously at the appropriate time. Ultimately, the specialist will disqualify the leads
if nothing happens or turn over a fully developed short-term lead to sales.
Short-term qualified leads typically have ten attributes (see below). Unfiltered marketing
leads rarely have more than three of these attributes, so any sales rep working on a
commission check will be delighted to get all ten. With a detailed picture of the
prospect’s business drivers, plans and buying processes, the sales rep is positioned as a
knowledgeable advisor interested in the prospect’s business challenges.
Attributes of Well-Qualified Leads
1. SIC or NAICS code
2. Firmographics (revenue, # employees, # of locations)
3. Decision makers and influencers identified
4. Environment documented
5. Decision-maker engaged
6. Business pain(s) uncovered/validated
7. Decision-making process and timeframe documented
8. Budget allocated or process for budgeting documented
9. Competitive landscape documented
10. Sense of urgency or compelling event exists
Clearly, the "lead farming" role is incompatible with the sales role. Good lead farmers
are hard to find. The best approach to performing the job effectively is to (A) assign it
to a specialized in-house team with no direct sales responsibility—or (B) outsource it to
a firm totally focused on nurturing marketing leads into sales opportunities. But,
whatever you do, don’t give a list of unfiltered, unqualified marketing leads to your
sales team.
07/2006, Dan McDade
| | Dan McDade is the founder and president of PointClear, the Business Prospect Outsourcing company. Before PointClear, he served as Vice President of Marketing for the direct mail firm Jackson & Perkins and as President of UST: The Business Marketing Group
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