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The Most Important Strategy for Improving B2B Lead Generation www.SureMeeting.com
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The Most Important Strategy for Improving B2B Lead Generation
YOUR SALES DEPARTMENT probably spends more on B2B demand generation than your marketing department does. Hard to believe, right? The typical sales person is spending 20 percent of their time prospecting. That means one out of every five field sales people on a team is just prospecting, not selling. That is a LOT of sales capacity to allocate to a low-yield activity like prospecting. In effect 20 percent of the sales budget is being allocated to sales prospecting. In most companies, that’s a bigger number than the entire marketing budget. So, the cost is high and the drag on sales production is significant. But it’s often even worse than that. Remember that the 20 percent number includes both sales hunters and sales farmers. Sales people managing existing accounts have a much easier time generating leads than do sales teams focused purely on acquiring new customers. For sales teams strictly focused on winning new customers, the percent of time can be much higher.
BUT WE PAY SALES PEOPLE TO PROSPECT! THAT’S THEIR JOB! It is true that many companies expect sales people to prospect. Leadership sees prospecting as a core part of the sales person’s job description. Of course, those same sales leaders typically have no idea what the answers are to these types of questions, which are fundamental to assessing the effectiveness of sales prospecting: • What is the conversion ratio of sales prospecting emails (that is, what percentage of sales emails result in an expression of interest? • What is the conversion ratio of dials to conversations with your buyer personas? • What percentage of those who express interest via email result in initial meetings? • What percentage of initial conversations when cold calling result in initial meetings? • What percentage of initial meetings result in a sale? • What is the revenue contribution from sales prospecting? • How much does sales prospecting cost? Without proper measurement of sales prospecting, how can sales leaders optimize this type of activity? KEEP READING ON THE NEXT PAGE >
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The Most Important Strategy for Improving B2B Lead Generation
THE PROBLEMS WITH MARKETING LEADS The reason sales people prospect, of course, is not because it’s their job. It’s because they won’t make quota without prospecting. Even in the best companies, leads from marketing seldom account for even half the revenue. Worse, the best companies typically only convert 1.54 percent of marketing leads into sales. As such, even with lead scoring, lead nurturing, and other best practices, sales people can spend a lot of time following up on marketing leads who won’t buy. For that reason, lots of leads don’t get the necessary follow up. Instead, sales people learn to follow up selectively and half-heartedly. They also find sales opportunities more efficiently through other means. Thus, closed-loop feedback is often inaccurate and incomplete, and without closed-loop feedback, improving lead quality is impossible.
In contrast, marketers often see all leads as having equal value, often because they do not have the benefit of closed-loop feedback. That’s not all. Marketing leads generally skew small. That is, most of the people who visit your website and respond to your search marketing campaigns work for small and medium businesses (SMBs), where the deal sizes are smaller. Generally, SMBs are not where most of the revenue comes from for most B2B companies. Revenues invariably come from larger accounts. For that reason, sales leaders will often deploy their most capable sales people against these large accounts. In contrast, marketers often see all leads as having equal value, often because they do not have the benefit of closed-loop feedback. Within this context, marketing focuses on lead volume and the unit cost of leads. In such cases, high volumes of leads and lower costs-per-lead equal success for marketing. Unfortunately, this perceived success is superficial because there is often an inverse relationship between lead cost and lead quality. As marketers chase ever lower-cost sources of leads as a means KEEP READING ON THE NEXT PAGE >
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The Most Important Strategy for Improving B2B Lead Generation
of increasing lead volume, conversion into customers declines as does the revenue per closed-won deal. The lower the quality of leads, the greater the cost in sales follow up and the lower the production capacity of sales.
THE REAL PROBLEM WITH SALES PROSPECTING While sales prospecting activity usually accounts for 50 percent or more of the pipeline, most sales people hate prospecting. It’s time consuming and demoralizing. (Try calling 100 people tomorrow who don’t know you. See how many of them are annoyed, abrupt, and even rude when you reach them. Worse yet, see how often you get nothing but voicemails). And yet, sales people won’t achieve quota if they don’t have a sufficient volume of opportunities in their pipeline, and in most companies, sales people won’t get that volume without prospecting.
Elite B2B sales people are extremely hard to find, develop, and retain. At the same time, is sales prospecting really the best use of sales talent? Elite B2B sales people are extremely hard to find, develop, and retain. When selling complex solutions, the best sales people not only possess superb corporate sales skills but also knowledge of the product portfolio, the industry context of that portfolio, the customer problems those solutions solve, and the evidence behind the claims. In many cases, sales people also are fluent in the industry of the prospect. They also have sufficient business acumen to glean insights from annual reports, press releases, industry analysists, and the like. Do you really want people with that knowledge and skill dialing prospects who don’t answer their phones 90 percent of the time? KEEP READING ON THE NEXT PAGE >
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The Most Important Strategy for Improving B2B Lead Generation
DUPLICATION OF EFFORT Finally, because sales and marketing both expend considerable resources generating demand, the question of duplication of effort arises. Without some tight integration of messaging and orchestration of methods of contact, the opportunity for inefficiency is very high. And yet how often do sales and marketing work together to increase the combined efforts of both departments?
THE BIGGEST PROBLEM FOR SALES LEADERS Not surprisingly, lead generation is the number one problem of 53% of sales leaders. In other words, the number one problem is not finding and keeping good reps. It’s not deploying sales technologies. It’s not sales training. It’s lead generation. Lead generation, of course, affects sales leaders in two ways: • Quota attainment requires a given pipeline number, given the historic revenue per closed deal and historic closing ratios. • The more resources sales allocates to sales prospecting, the less capacity there is for closing business. Given this second point, sales would seem to have a vested interest in delegating pipeline creation to marketing. However, rarely does such a scenario exist in companies selling complex solutions to other businesses.
HOW THE BEST COMPANIES ARE ADDRESSING THE LEAD GENERATION PROBLEM You can see why so many sales leaders cite lead generation as their number one challenge. The question is what to do about the problem. Clearly, at this point, most companies depend on sales prospecting. The question is whether this function needs to be a core responsibility of sales people. On the one hand, qualifying leads and prospecting for new opportunities does take a level of sales skills. You have to understand the problems your solution solves. You have to know how to ask good questions. You need to overcome objections. And you have to constantly prioritize which prospects warrant the most effort. Those are all basic sales skills. KEEP READING ON THE NEXT PAGE >
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The Most Important Strategy for Improving B2B Lead Generation
100%
Less efficient sales resources
Replace these sales resources with lower-cost methods of marketing and deicated opportunity development forms of contact
Allocated percent of sales resources
These reallocated sales resources result in increased revenue capacity/higher sales productivity
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More efficient sales resources
0% PROSPECT
NURTURE BUYING CYCLE STAGES
But let’s look at what you don’t have to do to qualify and generate leads. You don’t have to know nearly as much about the solutions your company sells. You don’t have to work cross-functionally in your organization to provide customers with an exact right solution. You don’t have to master organizational psychology in order to navigate the choppy waters of a customer organization. You don’t have to understand pricing. You don’t have to negotiate contracts. And so on. For this reason, establishing a function to follow up on marketing leads and prospect for new leads is a foundational step for improving lead generation efficiency. For decades, the technology sector has been an innovative leader in this area, referring to this function variously as “business development,” “opportunity development,” or “sales development” to distinguish these teams from inside teams that use the phone to close business or manage indirect channel partners. For our purposes, let’s refer to this function as “opportunity development.” The charter typically can include the following: • • • •
Following up on and qualifying/resolving marketing leads; Prospecting for new leads; Gathering sales intelligence; Validating contact and account information.
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CLOSE
The Most Important Strategy for Improving B2B Lead Generation
A BRIDGE BETWEEN SALES AND MARKETING In this capacity, the opportunity development team has obligations to both sales and marketing. For marketing this team provides qualitative and quantitative feedback on marketing-sourced leads. For sales, the opportunity development team provides qualified meetings, with the level of qualification dependent on a variety of considerations, including the lifecycle of the solution, price-point of the solution, and the buying process of the customer. In short, when managed properly, this function is the junction where sales and marketing collaboration and coordination can really pay off. Such a model allows both departments to bring their talents to bear on the always-difficult problem of pipeline development. Marketing can help with messaging and integration of other channels of communication. Sales can test messages and provide marketing with both qualitative and quantitative feedback. The opportunities for testing messages, cadence, list segments, multi-channel integration are almost endless.
THE BUSINESS CASE FOR THE CREATION OF AN OPPORTUNITY DEVELOPMENT FUNCTION There are several benefits when creating a function to find and qualify opportunities for other sales people: • More revenue through the overall sales and marketing budget, including budget dollars reallocated to this function • A means of measuring and optimizing techniques for inbound lead follow up and outbound prospecting • Increased rates of conversion on marketing leads • More consistent closed-loop feedback on marketing leads, which results in optimization of marketing lead generation investments • A source of proven talent from which to promote sales people Assessing the Viability of an Opportunity Development Function The first step in determining the viability of the use of an opportunity development function in your organization is getting answers to these questions:
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The Most Important Strategy for Improving B2B Lead Generation
• How much time are your field sales people spending prospecting? • Can sales leadership measure the top of the funnel stages related to sales prospecting? • On a scale of 1-10, how much alignment, collaboration and integration is there between sales and marketing at the top of the funnel: o For inbound lead follow up o For outbound prospecting If your sales people are spending more than 15 percent of their time prospecting, an opportunity development strategy is worth looking at more deeply. If sales leadership cannot measure this activity, then that gap is another reason to look at this strategy more carefully. Finally, if you would give your company a score of six or below on the last question, an opportunity development strategy may prove very useful.
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WHAT OUR CLIENTS SAY
SureMeeting’s mission is deeply rooted in the IT and B2B sales industries. We saw the need to support true sales “closers” with actionable opportunities through a consistent and sustainable flow of prospect meetings.
IT SECURITY CLIENT
• First Outbound Call Quality Control Platform developed
“In evaluating Demand Generation vendors, we found the pay-for-performance model offered by SureMeeting to be extremely attractive. Other per-month or per-rep models we evaluated didn’t provide a firm guarantee of results. So we were eager to work with SureMeeting, and have been more than pleased with the results.”
• First and the only to Guarantee Qualification Criteria and offer a Return Policy in our SOWs for Sales Appointments
MANAGED SERVICES CLIENT
In response to that need in the marketplace, SureMeeting began offering B2B appointment setting services to the high-tech industry. Since then, SureMeeting has pioneered a number of leading innovations:
• Transitioned our entire team from a traditional outbound call center to an Inside Sales Organization • Passed an industry benchmark of more than 20,000 Executive-Level Appointments and Leads generated per year • January 1, 2015, the first and only B2B appointment setting or lead generation company to abandon “cold-calling” and evolve to an “AllBound360” marketing platform SureMeeting stands firm on our commitment to clients to do what we say we will and deliver quality sales appointments, leads, and sales intelligence.
“What we liked most about working with the team at SureMeeting was the open communication we had throughout the course of the campaign. They were always available to discuss critical aspects of the campaign. In addition, they successfully developed a structured process to follow-up with key prospects.”
WORKFORCE MANAGEMENT CLIENT “What I like most about working with the SureMeeting team is that they do what they say they’ll do.”
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