According to a global study into sales effectiveness conducted in 2005 by CSO Insights, salespeople spend less than half of their working week actually selling. In fact, they spend almost as much time prospecting and generating new leads. Moreover, the study observed that companies better at targeting prospects are also more successful when it comes to selling.
Despite this, many companies continue to target their selling activities relatively indiscriminately. Lead generation is vitally important to most B2B companies, and with new technology and emerging best practice, there is increasingly little excuse for getting it wrong.
The importance of lead generation
It is important to understand exactly what is meant by lead generation. Nick Martin, MD at Mardev, offers this definition, “Lead generation is the specific identification of demand for your products and services. The term is used loosely to cover a range of outcomes, from an initial interest evidenced by a response to a call-to-action, through to a detailed fact-find.”
The next is to understand why it is important. Put simply, without leads, salespeople cannot make any sales. It is even more important in the B2B market where prospect companies are less well known and purchasing decisions are made by several executives. Carried out effectively, it can reduce cost-per-sale and dramatically increase sales volumes.
However, it is not easy to do this effectively. Louise Gulliver, MD of training consultancy Tack International, points out two difficulties. “A common problem is the quality of the source data. This needs to be up to date and vetted to comply with legal and industry requirements. Failure to do this can result in your target market blacklisting you. B2B marketers also need to manage internal expectations. Your colleagues might not appreciate that lead generation and professional campaign management has to be maintained to obtain results and a good ROI.”
Traditionally, there has been some debate about whether marketing or sales should be responsible for lead generation. This does vary between companies, but most now seem to agree with Andrew Morgan, MD at telemarketing consultancy Leadgen4u, when he says, “Lead generation should sit firmly with the marketing department. Sales people should be taking the well qualified leads, following them up and converting them into business. Basically, salespeople are too expensive to have sitting around looking for prospective customers.”
Richard Bush, MD of marketing agency, Base One, adds this advice, “It’s essential that you view lead generation as an ongoing process rather than as a one-off activity. Too many organisations think they can send out a mailer or run an ad and this will generate leads for them. They need to build a strategic campaign over a period of time if they really want to source a good number of high quality leads.” The following five elements should be integrated into campaigns.
1. A data service
Buying in a list of qualified prospects as a dataset is perhaps the most obvious method of generating leads. There are many suppliers, such as Mardev, that will help with this. Mardev offers over 300 lists that contain a total of more than 30 million named contacts across 20 vertical market sectors worldwide.
Furthermore, it offers a segmentation and modelling service that helps its clients identify its best customers and most likely prospects, and so prioritise those leads.
Dean Carroll, VP of Microsoft CRM at consultancy Aspective, adds this advice on buying data successfully, “One of the best ways to generate new leads is to subscribe to a data service, such as Experian. However, this is only effective if the data can be properly managed and stored in a CRM solution. You need to be able to produce accurate and targeted leads on demand while at the same time track their progress on a user-friendly database.”
2. Telemarketing
Telemarketing has been tried and tested over the years and remains one of the most effective ways to generate leads. Due to the fact that it involves a dialogue, it results in a high level of information about the prospect, and can – if carried out correctly – raise a prospect’s inclination to buy before the salesperson makes contact. There is a great danger, however, that telemarketing can have the opposite effect if carried out badly.
Jamie Vaughan, MD at telemarketing consultancy V2 Communications, says, “A common error is to pay an agency per lead generated, or to measure inhouse staff on this basis. A small number of well qualified leads will almost always be more useful than a large number of poorly qualified leads.” Telemarketing can be expensive, because it involves people actually making calls to prospects, but if you can afford it, a well structured long-term campaign will normally result in a steady supply of good leads.
3. Analysing browser behaviour
Andy Coghlan, head of strategy at email marketing solutions provider Responsys, says, “Analysing the browsing behaviour of visitors to a company website is one of the best ways of capturing leads, yet most people who visit a website leave unnoticed. You’re missing a trick if you’re not giving your visitors good reasons to ‘opt-in’ and submit information. This could be asking them to register to read something or to receive white papers.”
He continues, “Doing this provides you with leads who are already in the market for your products or services. You can do away with the months of planning to create a need and desire for the product or service that you need to put in with prospects, which are not in the market for what you sell. You can approach them much sooner and really focus on your selling points compared to those of your competitors.”
4. Public relations
One of the most cost-effective ways of generating leads is gaining editorial coverage in media that your prospects read, hear, or watch. CMS Acoustic Solutions hired the PR division of B2B marketing agency Native, to do this and help it achieve its objective of becoming the market leader in acoustic solutions for the construction industry.
Within six months, Native’s media relations campaign was delivering an average of 90 sales leads per month. Within the first year of undertaking PR activity, the company had increased its turnover from £2 million to £3 million, reducing the gap between its business and the existing market leader.
Colin Sneath, MD at Native, says, “PR not only generates valuable business leads, it also offers the opportunity to establish your company as an industry leader. The cost depends on the intensity and length of the campaign, whether it is delivered via an agency or inhouse and on the nature of the campaign. Budgets for a launch can start from £5000, whereas an annual campaign designed to deliver an ongoing source of lead generation can be anywhere from £20,000 to £200,000.”
However, PR communications are not as easily measured as other marketing media, and can therefore be seen as less responsive.
5. Live events
Exhibitions can be a great way to generate leads. However, you need to find the right events and spend time visiting all the stands. Carol Meyers, MD at marketing software provider Unica, describes how she found it more cost-effective to hold her own events. “We put on executive dinners and live seminars. They can provide an intimate setting to move the buying process forward. The cost of these events ranges significantly depending on venue, food, speaker and so forth. They typically range in cost from several hundred to over £1000 per lead,” she says.
