It’s widely known that lead generation is at the forefront of problems facing businesses. So I was surprised that there wasn’t a simple answer to the question: ‘what is lead generation?’
The definition of a ‘sales lead’ tends to vary depending on who you talk to. In fact, one of the areas of conflict between sales and marketing can be the very definition of what counts as a sales lead and what doesn’t. It’s important to ensure that sales and marketing are in agreement when it comes to qualifying and scoring leads.
During a recent visit to a US technology company, the marketing manager told me that his ‘perfect’ sales lead was one where the decision maker is known, and that they are ready to buy. For many of us this is indeed the perfect lead, but sadly not realistic. Finding the decision maker and knowing whether it’s the right time for them to buy, will depend on the detective work of your sales team in uncovering the relevant information.
Let’s clear the air; we know that there are misconceptions regarding the meaning of lead generation. It is a topic that lacks exploration, so let me get the ball rolling and address this. In turn, this should help you to make most of your sales processes.
A sales pipeline is a list of leads converted into prospects, of which a percentage will become your customers. The pipeline is also a process, as it has a number of stages through which the leads are divided into either ‘close lost’ or ‘close won’. Before you can manage your pipeline, you need to fill it will sales leads…this is where the fun starts!
There are three main stages of a sales pipeline: leads, prospects, and customers.
Some marketers define a sales lead as the moment a person/company expresses an interest or inquiry into the products or services of your company. But this is only a subset of your available market. In the case of B2B, only a small percentage of customers will contact a company either at start-up phase, or if they have a problem to fix. This is why most salespeople define a sales lead as a person or business who fits the perfect customer profile of their company. Many of your potential customers may not have even heard about you, or contacted you. Good salespeople will look for every potential customer that could buy from you.
Over the last few years, businesses have been told to focus their efforts on SEO and inbound marketing, with some believing that cold calling is a thing of the past. I would advocate for B2B this is not true. It’s important to focus efforts on both outbound sales and inbound sales if you wish to increase your revenue and market share. And the first step towards success is defining the perfect customer profile.
Normally, the ‘perfect customer’ possesses a number of key characteristics or attributes that will influence their likelihood to buy your product or service. Here are two examples.
A qualified sales lead is a lead that has been validated and checked manually within your organization (or by a third party) as meeting the minimum attribute level of the customer profile. This task is usually carried out by the marketing team.
Another perfect scenario is having contact information. Salespeople ultimately want to have contact details of the decision maker, but in reality this isn’t always possible. When it comes to the B2B industry, my advice is to include even the leads with little or no contact information when handing them to the sales team. The salesperson can check online, or pick up the phone and ring the company reception desk to find out this information. Ignoring sales leads that don’t have contact information will simply result in revenue opportunity being left on the floor.
Lead nurturing is the process of developing relationships with buyers at every stage of the sales funnel, and through every step of the buyer’s journey. This involves focusing marketing and communication efforts on activating the buyer’s interests in your product and service. As they are moved through each stage of the pipeline, the ultimate goal is that they become a customer.
A prospect is a person or organization that has expressed an interest in your product or service. This is not to be confused as a sales lead. A prospect is not the same as a lead; it is quite warm and has already approached your organization, e.g. via inbound traffic, phone calls, business card at an event, etc. However, the prospect still needs to be qualified. Although they may be a key influencer, they might not be the decision maker.
Once you’ve qualified your leads and prospects, it’s time to import these into your pipeline.
I think this is something we can most certainly agree on! A customer is somebody, be it an individual or an organisation, who has purchased your product or services.
So now that we’ve looked at the different definitions of each stage of the sales funnel, ask yourself: are you tapping into the correct sources when it comes to driving sales? Because we want to start exploring the different options for sourcing leads…. but that’s for the next blog post in this ‘Lead generation’ series. Ciao for now.