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Every year, companies pour millions of dollars into marketing and lead generation. Sadly, only 80% of leads are converted into sales. Poor lead management is to blame for such a dismal return on marketing dollars spent. In most cases, leads are punted over to sales before being thoroughly qualified. Even worse, 50% of all leads are being generated by sales teams and not marketing, per a 2009 CSO Insights study. Developing effective lead management processes can help your organization repair or avoid being part of this broken system.
Companies that excel at lead nurturing generate 50% more sales ready leads at a 33% lower cost.Forrester
Defining Effective Lead Management
Often identified as the process of qualifying and closing leads, effective lead management is more about developing the marketing funnel, not the sales funnel. The marketing funnel is the breeding ground for qualified sales opportunities (QSOs) where leads still need nurturing before they can be handed off to sales. Lead management is the process of how companies mobilize people, technology, and processes with the intent of delivering better QSOs.
To develop an effective lead management strategy, companies are beginning to take an aggregated approach, rather than individual marketing efforts. The pillars of an effective lead management process include the six elements of lead: marketing, capturing, nurturing, scoring, handoff, and funnel measurement.
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Although marketing automation has been a boon for some organizations, it addresses only a fraction of the overall lead management process, often leaving marketers wondering where they went wrong. Ignoring just one of the six pillars of an effective lead management process will leave your marketing efforts feeling rather flat.
Pillar 1 – Content Marketing
Perhaps the most vital of the six pillars, content marketing must be engineered to the B2B (Business to Business) buying cycle, which is best described in three phases:
Learning – Because there are a plethora of vendors using an overt position to showcase themselves, many buyers will look for non-vendor content, whitepapers, thought leadership positions, trends, and research reports. You’ll need to offer them something they can learn from.
Interest – Prospects are constantly looking for, and evaluating, solutions that coincide with their objectives. Solution-based content such as case studies, spec-sheets, and visual demonstrations will help you garner more interest as prospects begin to visualize how your solutions can fulfill their objectives.
Preference – Now prospects are starting to evaluate the solutions you offer and are trying to figure out if your solutions best address their problems. Prospects require content that gives them an in-depth look into product capability, feature comparisons, and ROI data. It is in the preference phase that you have an opportunity to start developing personal relationships.
Inbound and outbound marketing strategies can both make good use of your content marketing efforts. It’s important to have the right content at the right time to deliver timely, relevant content. Using a healthy mixture of personal and digital touches can help you accurately determine the buying cycle of your customers.
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Pillar 2 – Capturing Leads
Every effective lead management process requires a centralized database for marketing or sales opportunities. Your lead management efforts are doomed to fail if you don’t get a handle on opportunities as they come in.
Your leads are essentially company assets and should be treated as such. Just like inventory, you need a process for tracking your leads. Without the application of a common methodology and process for managing your leads, you’re spending money on an asset that you’re not even bothering to track and you’ll have no idea what the return on your marketing investment will be. Certainly, marketing automation can help improve your lead capture efficiency, but without a methodology and a process, it will fail to deliver more or better QSOs.
Pillar 3 – Nurturing Leads
Lead nurturing is essentially “continuing the conversation” by way of personal and digital contact with your prospects. You absolutely need to continue nurturing your leads until they are turned over to sales. Amazingly, more than 50% of all marketing departments don’t bother to nurture leads, per a 2014 Aberdeen Group study. To add insult to injury, a Sirius Group study notes that 80% of leads yet to be qualified will make a purchase within 24 months. It’s clear that not deploying a lead nurturing strategy means your company could lose a revenue opportunity.
People ultimately buy from other people, not companies. It’s the personal contact with your prospects that validates your true intentions – helping them achieve their goals. Coupled with lead tracking, personal conversations, and interactions that follow a predetermined methodology ensure consistency in your lead nurturing process. These interactions with the prospect allow you to assess the prospect and identify any influences in a given sales opportunity. The conversations you have also help you determine when a lead is a QSO, ready to hand off to sales.
Pillar 4 – Scoring Leads
As a marketer, you should be scoring leads throughout the lead nurturing process. Part of an effective lead management process is qualifying each interaction with the prospect, regardless of the methodology. Effective lead scoring models apply common criteria for quantifying behaviors, which in turn guide the next action, whether it’s more lead nurturing or passing the prospect to sales. Most important, lead scoring enables marketers to rank leads within the marketing funnel and aid in prioritizing high-ranking leads in desperate need of personal contact.
Creating a digital breadcrumb trail of a prospect’s behavior in an effective lead scoring process may include:
Downloaded Content – some content scores higher than others.
Download Quantity – may indicate a higher level of interest, which leads to a higher score.
Key Account – a higher score is warranted when a preferred target becomes a prospect.
Prospect Title – the position of the prospect may indicate buying power/authority.
Number of Contacts in an Organization – multiple buying authorities may be present in a given organization.
Pillar 5 – Sales Handoff
A seamless handoff is necessary, often aided by automation, from marketing to sales. Many marketing and sales teams struggle with this critical juncture. An effective lead management process means both teams, marketing and sales, are equally responsible for the end result – more business. It important that delivery of a QSO be based upon what the sales team deems as “qualified.” A lead score by itself rarely translates to the actual sales-readiness of a prospect.
A BANTFO (Budget, Authority, Need, Timing, Fit, and Other) analysis must be used in conjunction with a lead score to truly identify the viability of prospect. For example, a lead may have a high score due to the content downloaded or consumed. However, a BANTFO analysis and a personal phone call reveal that the prospect doesn’t have the authority to make a final decision or that the decision is over a year away. In this case, the lead would remain in the marketing funnel and nurtured until the timing is right for sales to take the reins.
Pillar 6 – Measuring Your Lead Funnel
Perhaps the most important pillar of an effective lead management process is lead funnel measurement. Remember that a lead funnel is a business asset and marketers need comprehensive lead measurement to get a better idea of the funnel’s value. Funnel measurement also indicates the effectiveness of both sales and marketing in the delivery of top-line results.
All lead interactions, digital or personal, must be visible from an executive perspective as well as a detailed micro-view. Lead origin, number of interactions and the lead score should be included in the metrics. Additionally, leads and the opportunities they represent, need to be tied to company revenue or they’ll have limited value. Only looking at how well marketing delivers QSOs means nothing if you can’t determine the ROI of your marketing investment.
If you apply an effective lead management process with these six pillars, you can drastically increase your QSOs, and revenue. Effective lead management optimizes your return on marketing and sales investments by applying resources correctly. In the end, you’ll get a greater return and reduce your overall cost per lead – leading to a much more effective lead management process.