Niche Info Online Business

by: Guest

E x e c u t i v e S u m m a r y

In today's B2B selling environment, it is increasingly difficult to surface, qualify, and, most importantly, drive a ready-to-buy sales lead to your sales staff. The competition for share of your prospect's mind is fierce. Business buyers are bombarded daily by advertising messages and pitches for products. Consider these facts of life that sales organizations face today:

The high cost of a sales call:

Of 23,000 businesses surveyed, the average business-to-business sales call cost $329.

A typical business-to-business sale that exceeds $35,000 takes an average of 5.12 sales calls to close, bringing the total cost of the sale to over $1600.

The average salesperson spends almost three-quarters of his/her active selling time with existing customers.

Less than 20 percent of sales efforts are being focused on prospective new clients.

Seventy-five percent of the companies studied say that a sale over $35,000 now requires a combination of direct and indirect sales efforts.

Source: Cahners Research - 2001

What then are leading companies doing today to keep their sales lead pipeline full?

The purpose of this paper is to explore the new trends and working practices in sales lead generation being deployed by successful sales organizations.

Introduction

Lead generation for many companies means sending out postcards in advance of a tradeshow, or a mass mailing of the annual product catalog. For others, it is a sophisticated program of integrated communication efforts with each measured along the way in an iterative, interactive process.

We've identified five key areas where companies today are making a difference in their sales lead generation efforts:

• Using the Web to Drive Leads
  
• Defining Ideal Prospects/Lead Scoring
  
• Lead Nurturing Trends
  
• Web 2.0 Strategies
  
• Tracking and ROI Measurement
  
• Using the Web to Drive Leads
  

There are two main web tactics that companies are using today to drive leads: search engine marketing (SEM) and webinars.

Search Engine Marketing

The market landscape has changed considerably in the past few years concerning the use of the internet in researching business buying decisions.

A full 93.2% of business buyers indicated they would first go online to research a purchase.

Among business buyers going online to research, 63% would first go to a search engine as the place to begin research, and an amazing 82.9% chose Google as their search engine of choice.

For purchases over $10,000, 60% of buyers would begin researching more than two months prior to purchase date.

Source: Enquiro/MarketingSherpa - Search Research Study, 2004

SEM has become a key method for many companies to generate a consistent flow of new business leads. There are primarily two methods in use, and another is fast becoming popular. Pay-per-click (PPC) and search engine optimization (SEO) have been the standard for years, and pay-per-action (PPA) is gaining use among internet marketers.

PPC allows companies to buy keywords that relate directly to their product, and to buy keywords at prices that put them high in the paid search listings of the major search engines. Keywords that include three or more words generally produce fewer visitors but convert visitors to leads at a higher rate than more general, one or two-word buys. Prospects typing in more specific, longer keywords generally have a specific product or service in mind and are more likely to visit your site if your keywords match their needs. As with all good direct marketing, companies effectively using PPC measure each keyword for cost-per-lead and ultimately cost-per-sale to determine where to invest future PPC dollars.

Search Engine Optimization SEO is the process of creating a website with content that, when properly marketed on the internet, is found at the top of the non-paid, or organic, search engine listings for particular keyword search terms.

PPA is paid keyword advertising like PPC but with the difference that the advertiser does not pay per click, but only pays when the prospect completes an action, such as purchasing a product, signing up for a newsletter, or completing a form. Leading PPA networks today include:

snap.com, services.google.com/payperaction/ (currently in beta testing) and turn.com.

Not enough companies today balance their PPC and PPA advertising with Search Engine Optimization (SEO) efforts and specific landing page creation (the web page that appears when a visitor clicks on your paid link).

Studies show that searchers will click on organic listings more than sponsored listings, and that organic listings convert better than paid listings. So while PPC is the easiest point of entry to search engine marketing, it's also important for marketers to develop an SEO strategy to take advantage of the increased traffic and quality of the clicks in organic search results. The big bonus, of course, is that clicks on your organic search links are free. Many service firms specialize in developing search engine optimization strategies and tactics for companies who choose not to perform this function in-house. Clearly, however, there is agreement that dedicated, consistent in-house or outside resources are critical to staying ranked at or near the top in the ever-changing SEO landscape.

Once a prospect clicks on your paid link, a specific landing page directly related to the keyword(s) is crucial to converting the prospect to a lead. Often, companies will deliver these prospects directly to a home page - which often requires a prospect to search among products or other areas of the site for the information he is seeking. When prospects are forced to do extra work, the risk increases that they will abandon their search. Specific landing pages linked to PPC keywords vs. generic landing pages have increased conversion by hundreds of percent in some cases.

Landing pages work best when they do not include extra links that allow the visitor to leave the page, but focus on your call to action, or what you want the visitor to do (respond for more information, download a whitepaper, sign up for a newsletter, etc). Both agencies and marketers report that testing landing page copy and design is among the top campaign tactics that improve SEM results (MarketingSherpa's Search Marketing Benchmark Guide 2005-2006).

Webinars

Webinars are not receiving the high sign-up and attendance rates we saw just a few years ago. However, they remain a popular choice of B2B marketers because the targeted content in a well-constructed webinar generates self-selecting prospects interested in your topic. To be sure, webinars take thoughtful planning and marketing to get good attendance and capture the attention of qualified prospects.

To promote your webinar, use the following key tactics that successful companies are using in webinars today:

Pay close attention to content - no one wants to attend a blatant pitch for your product or service. Case studies or recognized experts work best.

Use mid-week and mid-day times, keep the webinar to an hour, and start promoting around a month before the event.

Start with your customer base, prospect list, or outside email rental lists to promote your webinar. Use industry e-newletters or promote on other websites if possible.

Make the registration form as simple as possible, knowing that you can get more information from attendees with post-webinar marketing.

Expect 40 to 60% attendance and have a plan to invite nonattendees to the archived version of the webinar. Send reminders to the attendees that they and their colleagues can also view the archived event.

Track all attendees and feed into your lead scoring and lead nurturing systems.

Provide a short survey at the end of the webinar for feedback and gathering more information about your prospects.

Have a plan in place to send further communications to the attendees.

Defining the Ideal Prospect, Accurate Lead Scoring

Companies with successful lead generation programs have a clear idea of what their ideal customer looks like. Often, this profile is developed by analyzing data attributes of customers and by talking to the sales staff.

Profiles of target companies often include such attributes as:

Standard Industrial Code (SIC) or North American Industry Classification (NAICS)

Annual Revenue

Site type (branch, HQ, etc.)

Number of employees

Geographic location

Business situation (growing, acquiring other companies, etc)

Competitive or related products used

These attributes are used to determine the target list of companies for marketing, as they allow a company to identify prospects that look like one's best customers, and would thus be more likely to buy.

Lead scoring is the process by which a lead is assigned points, or some other qualifying label (based on a prospect's meeting certain criteria) that determine when a lead is passed through to the sales force. In many companies, each lead is assigned a label like cold, warm or hot.

The successful companies we've seen have more sophisticated systems which assign points that qualify and continually re-qualify a lead toward being sales-ready based on criteria such as:

Interest in products, demonstrated by webinar attendance, whitepaper downloads, etc.

Ideal Prospect Attributes

Opportunity size or amount

Intent to purchase

Influence in buying process - decision-maker, specifier, end-user

Time to purchase

In a simple example, an ideal prospect who represents a large opportunity indicates a desire to purchase in 12 or more months. They receive a relatively low score and are put into a communication or nurturing program that delivers valuable information to the prospect (in return for more qualifying information). When the purchase decision timing is within six months, or some predetermined time period, the lead receives a higher lead score and is delivered to sales. Points are assigned for each attribute, and it's only when the purchase decision is within six months that the new total score pushes the lead over the predetermined threshold that determines handoff to sales.

A scoring system will not work if marketing does not have feedback from sales as to which leads convert to sales. From study as to which leads become customers, marketing determines what lead-scoring attributes are most important, increases the scoring weight of those most important, and thus creates a more predictive and successful process that results in higher close rates. Top selling companies regularly evaluate what the ideal point threshold should be to determine a sales-ready lead.

In the end, sales really doesn't care what the lead score was, only that the leads were sales-ready and they experienced high close rates.

Lead Nurturing Trends

A monthly call by your in-house sales rep that seeks to close, or delivery of a one-size-fits-all e-newsletter is not lead nurturing.

Lead nurturing is the process by which a company delivers relevant information over a period of time that demonstrates your expertise and builds trust in your service or product offerings. Not every inquiry or lead is ready to buy when they first make contact with your organization. A cohesive strategy that develops a relationship with the prospect over time brings the lead closer to the buying decision and positions your

company as the preferred source.

The process of lead nurturing requires a dialogue with prospects in order to gain an understanding of the key benefits the prospect is seeking, and results in more relevant information being able to be delivered that addresses those needs.

Successful lead nurturing programs include a variety of tactics - telemarketing, webinars, whitepapers, and direct mail, among others. Depending on the attributes of the prospect, leads may be put into different lead nurturing promotion streams. Some prospects may not be as promising as others and so may not deserve the expensive product catalog. Marketers today have tracking systems in place that provide insight as to which lead nurturing tactics work best in moving prospects through the sales funnel toward final sale.

Customer Relationship Management (CRM) systems are used by many companies to track what information has been sent and what additional information has been acquired from leads in the system. These changes feed the lead scoring system as leads move closer to a sales-ready opportunity.

The lead nurturing/lead scoring integration is an iterative process that demands constant marketing attention and measurement. Building the relationship with the prospect by delivering relevant information based on their needs and developing a dialogue are the keys to successful lead nurturing.

Web 2.0 Strategies

Web 2.0 strategies being implemented today allow companies to reach out to their customer base and create dialogues with them. These Internet lead generation strategies include blogs, podcasts, and other technology-based forums that bring businesses, customers and prospects together to communicate and learn from each other.

One of the more promising uses of Web 2.0 is in allowing customers to comment on or rate a company's products right on the company's web site.

When business users are researching a purchase, some of the most compelling sales arguments are often delivered by current users. Who would you trust more, the company that makes the forklift or ERP solution, or business people like yourself who are using the products? An important bonus is that reviews and ratings of products make product refinements and new product development that much more sensitive to customer needs.

Blogs are spreading like wildfire - according to some estimates one blog is created every second of every day. Blogs in the business world have been somewhat slower to catch on, but have proven to be an excellent forum for customers and companies to interact. One would naturally expect consultants, business writers and technology companies like Sun Microsystems and HDNet to have blogs, but the likes of General Motors and Boeing have been at it as well.

In the open source software business, companies promote staff blogs and discussion areas where developers both inside and outside the company swap code. Marketers monitor and reward regular developers who contribute and enhance the companies' software offerings.

The key elements that attract customers and prospects to blogs are consistency and content. While daily blogs may be the ideal, weekly seems to be the preferred updating schedule by most company bloggers. Content must be relevant and inviting, even if the content is from another source, and should not be blatantly self-serving. Most blogs take an informal tone, which tends to make them more accessible.

Companies that write regular blogs can use the space surrounding the blog copy to offer webinars, whitepapers, free trials, and other product and information that requires the visitor to register, thus creating a lead. In terms of the lead quality from this channel, one can't imagine a more qualified lead than a prospect who is reading the company blog.

Web 2.0 strategies in B2B lead generation continue to grow, and new ideas in this space are being tested all the time. These dialogue and community strategies are bringing companies closer to customers and prospects, increasing the velocity of knowledge transfer back and forth, and will be an increasingly important part of quality lead generation in the months and years to come.

Tracking and ROI Measurement

Today CEOs and CFOs are demanding accountability and Return-On-Investment (ROI) measurement of all marketing expenses, not just lead generation. While lead generation campaigns typically have discrete and identifiable costs to aid in producing ROI metrics, the costs incurred by the sales staff once the lead is handed off are sometimes more difficult to quantify. While never perfect, the closer the alignment of sales and marketing teams in agreement of ROI measurement and costs, the more successful the companies are in generating sales and proving value to Clevel execs.

Once tracking is in place to deliver conversions or sales based on the lead generation channel - usually through a CRM system -- then the ROI calculations become simple to compare channel versus channel. Email campaigns versus print advertising versus direct mail, for example. Campaign metrics like cost per lead, conversion rate, cost per sale, and ROI are typically included in lead generation campaign reports.

Where sophisticated marketers are making improvements, however, is in understanding the dynamics and the ability to measure incremental contributions based on their actions within each channel. A simple example would be a direct or email campaign with several lists. While the campaign measured in total might prove to be a success, further analysis may reveal that among the 10 lists mailed, only four of them demonstrated acceptable ROI for the campaign.

Marketers who rapidly cut the unacceptable lists from future campaigns may be moving too quickly until they consider lifetime value. One of those marginal lists may deliver the exact attributes of your ideal customer profile, indicating great product or service affinity, high cross-sell potential and future profits. Over a three year period, customers who meet this profile are hugely profitable, even at expensive upfront acquisition costs.

So with an understanding of granular campaign ROI metrics (by list or keyword, search engine, or publication, etc.), combined with at least a sense of lifetime value by customer segment, marketers today find clearer direction on where to spend lead generation marketing dollars to produce the best return-on-investment.

Of course, in many companies and industries, campaign response and sales conversion rates are fluid and changing, making it all the more important to have reliable and timely tracking so that marketers can keep changing their allocations and tactics to generate the best ROI in their lead generation efforts.

About the Author

Mercury Leads is singularly focused on business-to-business sales lead generation. Their process includes competitive market benchmarking, best customer profiling, extensive testing of marketing tactics, lead scoring and lead nurturing. Mercury Leads takes a solution-neutral approach to sales lead generation. This allows development of a client-specific mix of marketing tactics that includes among others: search engine optimization, pay-per-click marketing, direct marketing, teleprospecting, print, tradeshow, email, webinar and whitepaper marketing. Mercury Leads serves clients from a wide range of industries, including technology, publishing, consulting and manufacturing. For more information,