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HOW TO: LEAD GENERATION
How to Grow Your Business with Lead Generation
Introduction: What is the modern customer relationship?
1. Finding leads: They’re out there, but you need to go get them.
WHAT IS LEAD GENERATION?
LEAD GENERATION DEFINED
Lead generation used to involve purchasing lists of names and having your sales teams cold call people at home. Thanks to technology, we can now generate leads based on specific criteria and information. Companies collect information about potential buyers, and then tailor marketing methods and sales pitches to those prospects’ needs.
This mainly happens through digital channels, using inbound marketing techniques and a little bit of old-school outbound marketing (more on that in a minute). Buyers today do so much online information gathering on their own, they’re not so keen on listening to traditional sales pitches. Instead, companies have to meet prospective buyers on their own turf: the internet.
2. Lead generation is all about relationship building.
DOING BUSINESS IN THE ATTENTION ECONOMY
People have only so much attention to give. But there’s so much content and information available in our digital world, businesses are constantly battling to catch the eyes and ears of potential customers. Some call this the “Attention Economy,” meaning that attention is a precious resource that drives markets. You might think of it as a “Customer Economy,” since ultimately your goal is to win customers and their business.
Winning customers and business is how you grow, after all.
Winning that business is all about relationship building. That’s true for B2C businesses, and it’s true for B2B, as well. With so much information at their fingertips, customers research and form opinions on brands and products well before they make contact with salespeople and enter what we traditionally think of as a customer journey. So when they do make contact, customers are looking for something more than an old-fashioned sales pitch. They want to trust your brand and feel good about buying what you’re selling. It’s on you to earn that trust and build a relationship with each customer.
EVERY JOURNEY STARTS WITH A LEAD
Customer journeys vary across businesses and industries, but managing the journey is key to turning a prospect into a happy customer, no matter what you sell. And every journey starts with a lead.
Which is why lead generation is so important. Without leads, your marketers have nobody to market to, and your sales teams have no buyers. Sounds obvious, no? And yet, 68% of B2B companies are struggling with lead generation, and only 13% of businesses describe their lead generation strategies as successful.
Lead generation isn’t about rounding up all the leads you can and forwarding them to your sales team. It’s about finding quality leads that you can nurture into relationships. Quality leads improve your chances of turning prospects into sales, and growing your business.
What makes a lead a quality lead? And what do you do with quality leads once you’ve rounded some up? You’ve got questions, and we’ve got answers: Read on.
3. Learn the types of leads: qualified versus unqualified, marketing versus sales.
THE FIVE TYPES OF LEADS
Defining different types of leads — and learning how to identify them when you see them — can really help your sales and marketing teams work together to grow your business (even if sales and marketing are the same people in your organization). First, let’s look at the five types of leads:
- New: Any potential customer you know something about. A new lead could be someone who visited your website and entered their email address, stopped by your booth at a trade show and swiped their badge, or walked into your store and signed up for a mailing list.
- Working: A lead with whom you’re having an active conversation. This person could be signed up for your email lists, following you on social media, or on the phone with you right now.
- Nurturing: A potential customer who’s not interested in buying right now, but does anticipate a future need. You keep in contact with this lead by sending them additional info — maybe a newsletter, product announcement, or upcoming webinar schedule — so they remember your company when it comes time to make a purchase.
- Unqualified: A lead who has decided they are not interested in what you have to offer.
- Qualified: Good news — a qualified lead is someone who has shown interest in your offerings and wants to do business. Qualified leads are also known as sales leads.
TURN NEW LEADS INTO QUALIFIED LEADS
Your goal, obviously, is to turn as many new leads as possible into qualified leads ready to do business with you. How your organization does that depends on a number of factors: what you sell; whether you sell online, in person, or both; and so on. But whether you’re a solopreneur selling subscriptions to your investment blog or a coffee roaster serving local businesses and mail-order customers, the same basic principles of identifying, organizing, and working with leads apply. The more efficiently your business captures and identifies new, qualified leads, the better you’ll be able to work with them.
So how do you that? Software can help. Let’s get started with lead generation tools.
4. Get started with lead generation.
TOFU, MOFU, AND BOFU: FILL THE MARKETING FUNNEL
Understanding the different types of leads, and how a new lead becomes a qualified lead, is one thing. Generating actual leads you can nurture into new customers for your business is another. Let’s put theory into practice with an overview of tips, tricks, and techniques for lead generation.
Salespeople and marketers like to talk about the funnel. The funnel is a way of describing all of your business’ potential customers, and how some of them will evolve into actual customers. The top of the funnel (TOFU) is full of leads — potential customers, most of whom are just trying to find solutions to the problems they’re experiencing but who may not be ready to purchase right away. The goal is to help guide as many of those leads as possible through the middle of the funnel (MOFU), where there is more interest in your product or business, to the bottom of the funnel (BOFU), where fewer people remain, but they’re the ones who are ready to do business.
The role of marketing and sales in nurturing leads through the funnel is a big topic — more than worthy of all that’s been written about it. For our purposes, let’s focus here on how to fill the top of that funnel with leads — quality leads, at that. We’ll talk about nurturing as part of the next section on lead management.
Marketing, of course, is key. People have to know about your revolutionary new coffee maker (or coffee delivery service, or whatever you’re selling) before they can buy it. A go-to marketing strategy in the digital age is to meet your customers where they are — on the internet. Building a great website for your company is a good place to start. From there you can use social media, blogging platforms, and email campaigns to drive traffic back to your site.
INBOUND MARKETING AND PROSPECTING
Today’s consumers have the internet at their fingertips and want interesting and useful content, not generic sales pitches. Spend time designing and crafting quality content to power your inbound marketing campaigns.
Unlike outbound marketing — television commercials, print advertisements, internet banners, email lists, and good old-fashioned cold calling, where you are proactive in your outreach to new customers — inbound marketing meets consumers where they want to be, providing the content and resources that will pull them into your business. The outbound style of casting broad nets for leads still has its place, but by and large inbound marketing has proven a more effective — and cheaper — means of generating quality leads.
ENTERTAIN AND INFORM TO GENERATE LEADS
Good content marketing entertains and informs with blog articles, social media posts, and other bite-sized content that adds something to readers’ lives and draws them to your brand. Small businesses in particular should remember that with a little know-how, a single piece of content is easily repurposed as a mini marketing campaign (or even a killer sales deck). Why constantly reinvent the wheel when you can keep riding the ones you’ve already made?
Prospecting is another technique that often provides the link between inbound marketing and sales activities. When leads have been nurtured through to the bottom of the funnel, your sales reps can follow up on them with prospecting activities. Prospecting generally involves targeted communications to individuals — like emails, LinkedIn messages, and phone calls or voicemails — as opposed to content meant to draw an audience. Another way to think about it is that prospecting is a one-to-one conversation, while marketing is one-to-many.
Consumer behavior changes constantly, and so do opportunities for lead generation. That’s why it’s important to periodically revisit your strategies for capturing leads to take advantage of evolving consumer behavior and technical trends. That said, in addition to establishing a strong online presence, referrals, word-of-mouth recommendations, tradeshows, and networking are all still excellent sources of lead generation. But whether you’re contacting with prospective customers in person or online, you’re going to want to keep track of them digitally. We call that lead management. Let’s walk through getting your business started with it, shall we?
5. Never drop a prospect.
FROM GENERATION TO OPPORTUNITY
Lead management is more than just organizing your leads so it’s easy to count them up and send them emails. Lead management is a sort of bridge between marketing and sales. It’s a process that starts with identifying leads, moves on to qualifying them, and ends with working them as sales opportunities. But there’s a lot that happens along the way.
As we said at the start of this article, today’s customer is incredibly educated about what they’re buying. They take control of the buying process way before you enter the picture, leveraging all of that online information we talked about earlier. Still, if you’ve identified them as a lead, that means they are at least someone interested in what you’re selling. Your job, then, is to help them learn more — about your product or service, about industry trends, and about successful customers they can relate to and be inspired by.
Engaging with and educating prospective customers like this is a big part of lead management. It’s at the core of lead nurturing.
LEAD NURTURING PAYS OFF
Nurturing is so aptly named because it’s all about giving your new relationship what it needs to prosper. Some leads will want regular emails, some will want quick responses to questions on social media, and others will want an 800 number and a conversation to learn more about your offerings. Developing an effective lead nurturing strategy pays off: Companies that excel at lead nurturing generate 50% more sales-ready leads at 33% lower cost and boast 9% more sales reps making quota than companies that struggle with nurturing.
As your company grows, lead management becomes about organizing and tracking not only who your leads are, but how they prefer to communicate with you, what you’ve already talked about with them, and which marketing campaigns they’ve enrolled in. That’s a little more sophisticated than just capturing an email address and adding it to the “To” field on your marketing newsletter.
THE BEAUTY OF LEAD MANAGEMENT SOFTWARE
Leveraging a lead generation and management system can help you increase conversion rates — how many leads turn into opportunities and, ultimately, sales. As crazy as it sounds, when you’re just starting out and can count your customers on one hand, dropped leads are a real problem for growing businesses. Lead generation software can help not only with finding new leads, but also with keeping track of who they are, how to reach them, and how you found them in the first place.
The beauty of lead management software is that it can help you capture information at a point of contact with your organization such as a landing page visit, white paper download, or email open. Based on the action, leads are scored and the next action defined. Having information about when and how your customers are interacting with your brand online allows you to create a one-to-one customer journey and helps your salespeople personally focus on well-qualified sales leads, while other leads can be automatically nurtured.
Before we transfer those leads to sales, let’s pause for a moment and talk about marketing integration. Many a business has found success using marketing integration to spur smart, efficient growth.
6. Route your leads down the funnel and into the pipe.
SMART LEAD MANAGEMENT KEEPS YOUR SALES PIPELINE FLOWING
In Point 2 of this article, we said this about the importance of quality lead generation:
Lead generation isn’t about rounding up all the leads you can and forwarding them to your sales team. It’s about finding quality leads that you can nurture into relationships. Quality leads improve your chances of turning prospects into sales and growing your business.
All of that hard work generating quality leads, qualifying and nurturing them? Here’s where it pays off: in the sales pipeline.
Sales pipelines are only as good as the leads you put into them. Fill your pipeline with quality leads, and it’ll reflect a sales team that’s actively closing deals and generating revenue. Fill the pipe with unqualified leads, and it’ll show sales reps working hard with not much to show for it because the leads are actually nowhere near ready to buy.
SCORING AND GRADING KEEPS YOUR FUNNEL FLOWING
Of course you want to fill the top of your marketing funnel with lots of leads. But as soon as they enter the funnel, you also want to start qualifying them to see which ones are worth the additional time and effort to guide toward the bottom. Lead scoring and grading help you do just that, calculating a lead’s value to your company (score) and likelihood of converting to an active customer (grade). Using lead scoring and grading together can be an effective way to ensure that only high-quality leads are passed on to your sales team. Lead management software can automate lead scoring and grading as well.
By definition, there’s less room at the bottom of the funnel than at the top, so manage your leads wisely to ensure that only active, qualified sales leads make it to the bottom and into the pipeline. Otherwise you’re going to flood your sales pipe with leads that aren’t actually ready to buy. They’ll sit still and clog the pipeline, taking up time your sales reps should be spending working active deals.
THE ART OF ROUTING LEADS
You’ve worked hard to fill your sales pipeline with quality leads. Now make sure those leads get assigned to the best salesperson to work each deal. Lead routing is the process of distributing leads to different people in your sales organization.
The idea behind lead routing is pretty simple, but as your organization grows, the process can get complicated quickly. You want to assign every lead to the sales rep best suited to guide the buyer through a successful transaction. That could mean distributing leads by geographic territory, by customer or deal size, or by which product(s) the lead is interested in.
You also may want to consider internal factors, like making sure all of your sales reps have hot leads to work, rewarding top-performing reps with the most promising leads, or other strategies that work for your business and culture. Different sales organizations distribute leads differently, but however you choose to handle it, lead management tools can help.
Good lead management software offers a variety of ways to automate scoring, and manage and route leads based on whatever combination of factors works for your business. From lead qualification criteria and assignment rules to automated reports on pipeline status and sales team performance, today’s lead management systems offer flexibility and scalability to grow with your business.
98% of sales only come after at least one follow-up