Wednesday, March 25, 2009
By Dennis Head, Principal eDemand Leads LLC
While I was working at Avaya, we had developed very effective lead metrics that allowed us to track the various lead sources from our marketing tactics. We were able to compare the conversion rate of each source into a qualified enterprise lead through our telequalification process. This conversion rate scorecard was reviewed weekly to determine the volume of various lead sources and the percentage of conversions. We consistently delivered leads that converted from Marketing Qualified Leads (MQL) to Sales Qualified Leads (SQL) in the 70% to 80% range.
The challenge in generating very high quality leads is finding sufficient warm lead inquiries to meet your MQL volumes. We were seeking alternative lead sources that could generate a high lead conversion rate at an acceptable cost. As we discovered new lead sources, our process was to do pilot evaluations to measure how these purchased leads converted into qualified leads.
As we analyzed our marketing investments, it was clear that some of the traditional lead sources that made up a significant portion of our lead budget were not performing as well as they had in the past. Our biggest decline was in the area of direct mail campaigns; we found that the response and registration rates had dropped significantly from a historical perspective. We also found that of those responders we were not hitting the targeted enterprise segment, but rather a large percentage from the SMB market. The net result was our cost per qualified enterprise lead from these sources had doubled over the previous years.
As part of the ROI analysis, we determined the average cost per lead inquiry, including the campaign expense, as well as the telequalification costs. Added together, it gave us a dramatic view of the wide cost range to generate a qualified enterprise leads. The costs ranged from hundreds to thousands of dollars depending on the source.
We were seeking alternative lead sources that could:
1. Reach the target enterprise market segment (100+ employees per site)
2. Deliver a higher lead conversion rate from lead inquiry into a marketing qualified lead (MQL)
3. Reduce the total cost per lead, including the combined lead source purchase and the telequalification costs.
We discovered two external lead sources that significantly improved our performance in the above three areas. It was purchasing targeted and prequalified leads from external sources.
The first source was from our primary database vendor that provided site and contact information for our sales force and our marketing campaigns. To ensure their information is current, they call and survey their entire base every six months. This allows us to include an additional survey question to be asked and buy the results from that question. We asked, “Are you going to be making a decision to change out your phone system in the next 12 months?” We purchased the names of those who responded “yes” and fit our criteria for enterprise customers. Cost per lead inquiry was under $100.
The results from those leads was very favorable:
1. A conversion rate from 20% to 30% into qualified leads (MQL) - nearly double the average for all other lead sources
2. The ability to pay only for leads that met our enterprise market segment size (Employees = 100+)
3. The low cost of the purchased lead inquiry coupled with the cost of the telequalification resulted in an overall cost per qualified lead that was roughlyhalf the cost of our traditional lead sources
The second source of highly qualified leads was from a business media company that publishes Internet-based content across a range of vertical markets. They provide a lead inquiry called a HQL (Highly Qualified Lead).
1. These leads were more expensive (in the $200 to $300 range) but the conversion rates were in the 35% to 45% range, which was two to three times higher than our average lead source
2. We were able to purchase only those leads that met our market segmentation criteria for the enterprise market
3. The total cost per qualified lead including the lead source and the telequalification was about 60% of the traditional lead source
Lead sources such as these can help enhance your lead program. These sources are not exclusive to you; your competitors may be buying the same leads as well. The first step is to test before you buy. You need to have a process to accurately measure your conversion rates and compare them to your traditional sources. Continually monitor your conversion rates from all of your lead sources to identify how they are performing.
A key success factor is your criteria of lead quality and the dollar size of the opportunity. This approach worked for larger enterprise leads that have longer-term sales cycles and average sales price exceeding $50,000. For smaller SMB where the value of the sale is much less, the same process can work if the cost of the lead inquiry is also much lower.
Dennis Head is a nationally recognized Sales/Marketing Management Executive with expertise in building quality lead generation programs that guarantee sales and revenue profitability. He is a frequent speaker at major conferences, like Marketing Sherpa and the Direct Marketing Association. Dennis worked as the director of eDemand lead Generation Programs at Avaya from 2000-2008. He holds an M.B.A in Business Administration and a B.S in Marketing from Michigan State University.
Monday, March 16, 2009
By Ardath Albee, Author of Marketing Interactions blog
Nurturing programs have many more applications than drip marketing campaigns to your house lead list and eNewsletters sent to your customers. A webinar requires a number of steps from pre-promotion to post-event follow-up. But, when's the last time you actually thought about them as a nurturing program?
The audience has to be aware you’re having a Webinar, decide it’s worth their time to attend, and be motivated to register. Once attendees are there, you want them to stay the entire time, and continue dialogue.
Even if the audience is aware of your event, it may take several tries for them to decide it's worth their time. You may need to create differently worded invitations and landing pages for the different personalities of your anticipated audience.
Instead of sending the same invitation repeatedly, consider approaching each invitation you send from a different angle. Or perhaps test the wording of the bulleted points in several different versions to see which work best for motivating registrations.
Think of a Webinar invitation series as an example of the versatility and depth your expertise will provide during the presentation. Can you make the event more exclusive? Are you unveiling new research? Showcasing a customer story that speaks directly to their situation?
Once people register, consider ways you can create advanced participation. Can you survey your attendees to find out how to add value that is specific to these people? When people participate in creating the event they'll attend, they have a stake in the ground to actually show up.
Send reminder emails that provide a way to add it to calendars. Relate the reminder to your invitation, but add something else with value—like a white paper or eBook download special offer at the end of the event. Why not roll out the "goodies" during the nurturing campaign to drive registration?
Start your Webinar with these three things:
1. Make the first slide deliver value for them. No company blather up front. You need to create immediate engagement to lock in their commitment to stay.
2. Tell them what they'll get and why it's important. Use words your audience would use and frame the ideas from their perspective.
3. Acknowledge the advanced participation and talk about how it's being used. This creates anticipation from the people who participated and for the attendees to learnwhat their peers think.
Afterward, you need to interact and extend the dialogue with attendees. Do you have a follow-up informational offering that will help them extend the ideas you shared in the webinar? Unless they've asked you to, this is not the time to switch to sales mode.
Perhaps you've created a content series they can subscribe to, giving you permission to dole out that information in bite-sized chunks that move them into a nurturing program that extends from their current position in the buying process.
Webinars are one of the top three informational vehicles specified by BtoB buyers as providing high value. If you're going to go to all the trouble to create them, you should maximize the return on attention—for them and for your company. The better you get at short-term nurturing programs for webinars, the more you'll learn about your target markets that can be applied to your longer-term nurturing programs with other leads.
Ardath Albee, CEO of Marketing Interactions, Inc, helps B2B companies with complex sales increase and quantify marketing effectiveness by developing and executing customer-focused e-marketing strategies driven by compelling content. Her clients experience results like an increased 375% of sales-ready leads in just 8 months which translate into millions of dollars added to their sales pipelines. But, marketing isn't just about generating new demand. Ardath helps clients re-engage customers and build loyalty that adds longevity to customer lifecycles. Visit Ardath’s website: www.marketinginteractions.com and find fresh marketing insights on her blog at http://marketinginteractions.typepad.com.
Tuesday, March 10, 2009
As today’s buyers embrace a new suite of information resources, today’s marketers must make the effort to truly understand these sources and how buyers are using them to self-educate and form opinions about their products and services. Such an analysis is a prerequisite for making reasonable decisions about investments in new media and marketing channels.
Buyers typically proceed through a three-phase education process in the early stages of the procurement cycle. While these phases aren’t as discrete as presented below, this framework helps us better understand matters from the buyer’s perspective.
PHASE 1: SOLUTION AWARENESS AND MARKET EDUCATION
In this first phase, the buyer is seeking as much relevant information as possible. Business executives continually seek out, sift through, explore, and exchange ideas about their market or sector – a continuous process that is integrated into their daily lives as part of their larger mission and responsibility.
Over time, the buyer encounters concepts that speak to a recognizable pain and resonate with and add value to her organization. From there, the buyer moves to discover what solutions may exist to address that pain.
PHASE 2: SOLUTION DISCOVERY
In this stage, the buyer has a specific business pain in mind and is exploring the market to gain a sense of what solution might be able to meet that challenge.
Who are the relevant vendors in this space? What are the high-level specifics about those solutions – is it an outsourced solution, a piece of technology, or a consulting engagement? What is the “ballpark impact” of the proposed solution on the budget?
PHASE 3: SOLUTION VALIDATION
With a prioritized list of vendors, he begins to delve into the alternatives more deeply to determine which choice is the best fit for his organization.
The prospective buyer wants to know what is being offered for sale, what the price is, whether it solves the identified business pain, and what the impact will be on the organization.
THE COMPONENTS OF THE TOOLKIT
Traditionally, this education process has been guided by the trained, knowledgeable sales professional who understands what’s involved at each milestone and what the buyer needs to know. Today, of course, that opportunity is largely disappearing because the sales professional doesn’t enter the picture until much later – after the education and solution discovery are complete (or nearly so).
Most tools that educate prospective buyers are relevant to more than one aspect of the buying process – so this simplification to three phases inevitably loses the nuances and complexities that any process has. However, it allows us to cut through much of the noise surrounding technology and information sources on the market today and concentrate on what matters: ensuring the right person receives the right message in the right format at the right time.
The following list is not exhaustive. However, it is a useful categorization of several of the more popular tools and sources that shape this book’s framework.
Figure 3: Use of different marketing vehicles by buyers at stages of the buying process.
THE BUYER’S EVOLUTION
As buyers move away from dependence on a vendor’s professional sales team for market education and awareness, solution discovery, and validation, the suite of tools they rely on to source their information continues to evolve in depth and sophistication. Today, marketers must understand the evolution in the buyer’s behavior and, more importantly, how to interact with the buyer in this new paradigm to optimally influence the buyer’s decisions. Marketers must rise to the challenge: marketers must cultivate new skills to observe and understand the buyer’s digital body language.
Steven Woods has been a leader in the current transformation of marketing since 1999 when he co-founded Eloqua. In his new book, Digital Body Language, Steven distills his insights into the challenges and opportunities faced by today’s marketers into a framework of thinking about their audience, and their role, in a new way.
Tuesday, March 3, 2009
The pipeline took a beating last year and it doesn’t look like it’s going to get any better this year. In fact, signs are pointing to an even more challenging year. It’s rough, no doubt, but there is one area where you might find opportunity, and its right in front of you. Try mining your existing accounts for opportunity and you might just find a goldmine in your own back yard.
Sales force compensation policies and coverage models create cross-sell opportunities in existing accounts that are easy to identify and capture, if you know where to look. To discover it, you need to mine two critical pieces of information. First, you’ll need to dig out information on when you acquired a customer. This information is usually available in your CRM, Order Entry, Customer Service systems. It will be important to note what product or services they purchased and what additional products/services they have acquired over the life of the relationship.
The second piece of information you’ll need is date/s when you launched/introduced your most successful/largest products. Once you have this information, you then create a simple grid (see below) with the following sorts:
- Segment your customers into date acquired using ranges (0-2yrs, 3-5 yrs, etc.)
- Segment your products based on when they were launched using ranges (same as above)
- Then create a cross segment via the two sorts (see below)
The analysis is that it is simple and actionable. Once complete you’ll find the following:
- New customers will be well penetrated with new products (see reasons above).
- Old customers will be well penetrated with older products (ditto).
- As a result, there will be opportunities to sell new products in older customers and… yes, you guessed it…older products in new customers.
We discovered the pattern years ago when building out new sales channels for companies. To avoid channel conflict we had to find “white space” to create opportunity for the new channel. If you have dedicated product specialists this pattern will be even more extreme. You will need to do some work on the products (in particular the older ones) to see if they are still relevant. It’s particularly useful for finding opportunities for products that are “rev. 2.0, 3.0, etc. Sales reps tend to take a pass on a product enhancement or extension.
The need for easy to access opportunity couldn’t be greater in today’s economy and, as everyone knows, the value of gold goes up in a recession.
As Senior VP at MarketBridge, Scott and his team have helped clients in the Financial Services industry developed innovative ways to bring new products to market, improve market coverage and growth through the deployment of new channels of distribution and increase the overall performance of sales and marketing investments. Over the last 10 years he has also lead the Marketing practices and he continues to direct the marketing activities of the firm. His unique insight and use of digital media and interactive marketing has earned him MarketBridge’s Innovator’s Award for creative application of technology.