Monday, October 26, 2009

Managing Lead ROI With Predictive Modeling

By Jeff Liebl, VP Marketing & Product Sales, eBureau

The biggest challenge with buying sales leads from third-party affiliates and aggregators today is the difficulty in measuring lead quality and predicting return-on-investment. In some product/service categories, it may take weeks or even months before a buyer can clearly assess the quality of a given lead based on whether or not it converted. Moreover, quality can be volatile month to month, even from the same lead source. If you can’t reliably measure quality, how do you know if you’re paying the right price for leads?

Leave it to the online education sector to teach us new techniques. For-profit, higher-ed giants like the University of Phoenix, Corinthian Colleges, Kaplan University and many other schools spend about $1 billion combined each year buying leads from third-party aggregators and affiliates. And they are leading a quiet revolution that will change the dynamics of lead pricing in every product and service category. These companies are not only insisting on lead ROI, they want it to be quantified before they buy leads. Sophisticated predictive lead-scoring technology—much the same as that used for many years by offline direct marketers and financial institutions (think FICO credit score)—makes this possible by running leads through predictive models that leverage huge databases containing consumer-specific demographic and other data.

Here’s how it works. Before they actually purchase any leads, some online educators use third-party service providers to score the leads. Say a company is testing a lead supplier based on an initial 500 leads. The lead scores indicate they are a mixture of high and low quality. In general, there are more high quality leads in the mix, so the overall average price is set at, let’s say, $47. Then the company creates three pricing tiers: good quality leads priced at $55, average quality priced at $38, and the worst 8% of the leads at $5 apiece. The campaign begins to run at 100 leads per day, but the lead score indicates that the campaign’s quality is deteriorating. Fortunately, the pricing tier automatically reduces the average cost per lead to $37. The lead seller also sees the drop in quality within the first couple of days. Since the lead score reports the quality of every lead in real-time, the lead seller uses this feedback loop to trace the source of the bad quality back to a couple of its new affiliates. Those affiliates are shut down and the average price per lead climbs back to $47.

Throughout the month, the lead seller tries different approaches to improving lead quality and identifies some new sources that bring its average up to $50 per lead. These are better-quality leads and worth the extra $3 each. With the increase in volume, the buyer’s call center is now getting 250 leads more per day. The lead scores help to prioritize follow-up efforts. The highest-scoring leads are quickly routed directly to the company’s best call center agents and the $5 leads simply receive an email follow-up. Despite the spike in volume, the lead conversion rate goes up by double-digits because the focus is being placed on the right leads.

Class dismissed!

Jeff Liebl is VP, Marketing & Product Sales, at eBureau, leading the marketing, product management and product sales organizations. His experience includes management roles in marketing, product management and business development with Silicon Valley-based Fortune 500 and venture capital-funded startups. In his previous role as Vice President of Global Marketing & Product Management for Ubiquity Software, Jeff built a 20-person global team, branded the company and launched several new products. Ubiquity successfully IPO'd in March 2005

Tuesday, October 20, 2009

Selling to the C-Suite Author Stephen Bistritz Shares Exec Viewpoint

Reaching key decision makers is top of mind for salespeople, but the lack of access the C-Level can incur missed sales opportunities. Focused on providing key tactics to reach the C-Level decision makers responsible for approving top-dollar deals, new book “Selling to the C-Suite” compiled responses from CXO-level executives about their professional relationships with salespeople.

Co-Author Stephen Bistritz, Ed. D. shared some of the key findings with DemandGen Report, including how salespeople can gain credibility among their target prospects and the nature of the executive buying process.

Picture_2DemandGen Report: What are some of the ultimate takeaways from “Selling to the C-Suite,” and how is the book different from other literature on selling?

Stephen Bistritz:
Most – if not all – of the books on the market today were written by salespeople from an anecdotal perspective. The content is mainly about how the salesperson was able to sell effectively in a particular environment. To our knowledge, none of the books currently available on this topic were developed mainly from the executive’s perspective. This book is based on a number of research projects, conducted by the authors over an extended period of time, where CXO-level executives were asked about their relationships with salespeople. One of the research projects was in the US, while the other was in Asia Pacific.

DGR: The book is a result of extensive research on the behavior of executives. What were some of the questions you asked CXO-level executives in your research?

Bistritz: Some of the specific questions posed to those executives include:

  • When and why do senior executives get involved in the decision-making process for major purchases?
  • What is the most effective method for salespeople to use to gain
    access to executives?
  • How do executives screen or test salespeople?
  • What has to happen in meetings with salespeople for the executive to feel it was effective?
  • How do salespeople establish trust and credibility with executives, thereby gaining return access?

What were some of the key findings from those questions and what surprised you the most about the responses?

Bistritz: First, executives said they were not opposed to receiving sales pitches or presentations, as long as salespeople listened and understood their major concerns and business issues before proposing a solution. From the executive's perspective, salespeople often came to their office with a solution looking for a problem and that was a significant turn-off for the executives.

Second, that executives said they wanted a single point of contact to help them resolve problems that arose during the implementation of a solution. Executives understand that complex solutions may often involve multiple business partners, but executives wanted a single point of contact and accountability.

Third, it was interesting how executives still value responsiveness and value that characteristic.

Fourth, their description of when they get involved in the buying process for major purchases was interesting and insightful. It also indicated to us that they want to meet with salespeople at specific times in the buying process and may also avoid meetings with salespeople at other times in that process.

DGR: From an anecdotal perspective, what response did you receive about some of those issues that most impressed you?

Bistritz: When we did the initial interviews with CXO-level executives, we practiced our interviewing techniques using executives from one of our sponsors (Hewlett Packard). We were sitting in the CIO’s conference room after the interview and I asked him: Why would an executive at your level ever agree to meet with a professional salesperson. And I’ll never forget his answer! He said to me: “Steve, I like to meet with professional salespeople because often they can offer me solutions to my problems that even people within my own organization can’t solve. And that’s because they have encountered and solved those problems in other organizations – and I want the benefit of their experience.” That clearly showed me the value of being a professional salesperson!

DGR: What are some of the critical factors in the book that salespeople would be most interested in?

Bistritz: The book provides many insights about selling to executives—primarily from the executive’s perspective. For example, as indicated earlier, we learned that there are specific times in the customer’s buying process for major purchases when senior-level executives get involved and engaged. At other times in the buying cycle, senior executives tend to delegate responsibilities down to lower-level executives or managers in their organization. Understanding when to engage with senior-level executives during the buying process is a key point.

In addition, salespeople will learn what executives feel has to happen in meetings for the executive to sense that the meeting was effective. Further, salespeople will find out how to become perceived as a trusted advisor by executives, thereby getting return access to them.

DGR: What are some of the key factors for salespeople to employ to establish credibility?

Bistritz: Salespeople must demonstrate both capability (by solving business problems) and integrity (by being reliable and consistent) over the long term in order to be deemed as credible by senior client executives.

When salespeople demonstrate both capability and integrity over the long term they start to operate in what has been described as the Client Value Zone - and it is here that the salesperson can become perceived as the trusted advisor by the executive. In addition, when salespeople operate in the Client Value Zone (and become the trusted advisor to the executive) the relationship begins to become collaborative.

DGR: Can you speak to the nature of the C-Level buying process? How can salespeople nurture this?

Bistritz: When we asked CXO-level executives when and why they got involved in the buying process for major purchases, we received some interesting responses. Those executives told us that they got involved early in the buying process to:(1) establish the objectives for the project and (2) set the strategy for the project.

They also told us that they got involved at the end of the buying process to (1) review the implementation plans and (2) measure the results.

They said that they tend to delegate to others (in their organization) the aspects of the buying process associated with exploring solution options and vendor selection.

Therefore, salespeople need to get involved at the beginning of the buying process to help establish the objectives for the project and also at the end of the buying process to make certain they communicate the results of their solution - in terms of the business value delivered - because executives want to understand the value that their investment (in the vendor's solution) delivered to the organization. Obviously, enhancing relationships with senior client executives when not involved in a buying process helps ensure access to those same executives at any time during the next buying process!

DGR: The book mentions the term “relevant executive.” What are the facets of this term and how does it relate to the salesperson?

Bistritz: In the book, we talk about the need to get access to the relevant executive for the sales opportunity. This executive is often overlooked—even by the most experienced salespeople.

We make the point in the book that you may not always need to get to the CEO of the client organization to sell your solutions. In fact, in many cases, salespeople are better served by not getting to that level to try to close deals involving their solutions. You need to find the executive with the highest rank and greatest influence for the specific sales opportunity. We identify that executive as the relevant executive—we also point out that the relevant executive could also be defined as the executive who stands to gain the most or lose the most as a result of the application or project associated with the sales opportunity. If you can align with that executive you will find that s/he will be able to exert an element of informal power as it relates to the buying decision.

Dr. Steve Bistritz has more than 40 years of high-tech sales, sales management and training management experience. He is a published author and lecturer in the field of sales, sales management and selling to executives. Steve spent more than 27 years with IBM in sales and training-related positions. He then worked for a sales training company where he led the development of sales training programs which were delivered to tens of thousands of salespeople worldwide.Visit his website at

Tuesday, October 13, 2009

When was the last time you stole a customer?

By Prugh Roeser, Founder, The Devereux Group, Inc

The BtoB marketing fight is for prospects, not customers, and winning the fight for prospects has become as important as sending the right leads to sales. This article explores how prospect retention impacts every aspect of lead nurturing:

  • Prospect Experiences
  • Techniques for Lead Nurturing
  • Lead Nurturing Objectives
  • The Right Kind of Lead Nurturing for Your Organization
  • Where Do Lead Scoring Capabilities Fit in?

Prospect Experiences

According to the “Rule of 45,” 45% of inquiries buy within 12 months – from somebody. Another 30% still plan to buy at the end of that same 12 months. That’s 75% of inquiries– that you’ve already paid for – that can become sales for you and not someone else. When you hold onto more inquiries, you reduce opportunities for competitors and increase return on lead gen at the same time.

Maximizing prospect retention may seem new, but you already have tools for achieving it. Just like optimizing customer experiences, you can optimize prospect experiences so they stay interested, and don’t defect to a competitor. Lead nurturing’s role is to embody the experiences you want prospects to have.

Techniques for Lead Nurturing

Prospect experiences utilize one of several contact techniques, but they all roll up into 2 basic approaches to lead nurturing:

  • Reactive
  • Proactive

With the Reactive approach, each time a lead acts, nurturing is delivered according to what occurred, primarily using:

  • Auto-responders
  • Trigger-based marketing

With the Proactive approach, contacts follow preset intervals and pre-defined purchase processes. Lead behavior can change content and delivery schedules, but nurturing continues unless there’s an opt-out or request to stop. Primary techniques are:

  • Drip marketing
  • Keep-in-touch marketing (i.e., newsletters)
  • Proactive lead nurturing

Lead Nurturing Objectives

Reactive and Proactive techniques work best for lead nurturing objectives that leverage their respective strengths. When objectives are set, preparing leads for sales is usually number one; but that omits many ways organizations utilize lead nurturing:

  1. Improve scores and qualification levels of leads not ready for sales
  2. Promote the organization and its products to leads not ready for sales
  3. Gather contact information and sales intelligence
  4. Reduce prospect attrition
  5. Follow up with anyone showing interest
  6. Shorten sales cycles
  7. Minimize time wasted on poor leads
  8. Automate lead ranking
  9. Evaluate lead sources, content and offers

10. Reduce cost per lead

11. Improve marketing ROI

The major impact of each objective falls into 1 of these categories:

  • Sales-readiness
  • Prospect retention
  • Sales productivity
  • Marketing productivity

The Right Kind of Lead Nurturing for Your Organization

This matrix identifies the most productive techniques for each category of lead nurturing objectives:

Categories of Objectives

Reactive techniques

Proactive techniques




Prospect retention



Sales productivity



Marketing productivity



If sales-readiness is the primary focus, both reactive and proactive techniques work. Reactive nurturing techniques don’t work as well for the other categories, however, because they need to be triggered by lead activity.

Proactive lead nurturing techniques work better for prospect retention and productivity-oriented objectives because they don’t wait for leads to act. Leads aren’t ignored, and don’t have a chance to just slip away.

Where Do Lead Scoring Capabilities Fit in?

The value of lead scoring depends on lead nurturing objectives and where scoring occurs during the process. When Sales-readiness is the primary emphasis, scoring has a natural role assessing lead progress towards being qualified enough for Sales to contact.

Lead scoring is less important when the primary nurturing focus is not Sales-readiness. In a prospect retention or marketing productivity context, scoring quantifies and standardizes how you evaluate nurturing effectiveness, define lead segments, and measure the performance of lead sources, offers and content.

Determining which kind of lead nurturing is right isn’t as simple as comparing the products of competing solution providers. You need to establish the mission of lead nurturing in your organization. Our focus here has been to create a framework for deciding that mission by defining objectives and requirements.

Regardless of how an organization decides to put lead nurturing to work, this evaluation framework can bring objectivity to that decision-making process.

Prugh Roeser founded The Devereux Group in 1986 as a BtoB marketing company that delivers integrated Bottom-Line Marketing programs. Primary services include strategic marketing consulting, direct response, email marketing, and LeadMaker, a proprietary lead management, nurturing and qualification process that features multi-touch buyer-cycle contacts to turn raw leads into real opportunities. Prugh can be reached at This e-mail address is being protected from spambots. You need JavaScript enabled to view it , or 781-631-9213.