Companies spend a lot of time and money trying to identify potential new customers aka "sales leads." Much of that time and money is wasted, however, because companies pursue outmoded lead generation methods.
As I shared in a previous column, some prospective customers are more valuable than others, based upon their likelihood to buy. Because of this, lead generation can now be ranked by their effectiveness in finding prospects who are likely to become customers:
1. Recommendations and referrals.
Once you have a customer base, you're #1 marketing priority should getting those customers to recommend you to other customers, both inside and outside their organization.
This means asking existing customer if they know somebody who'd benefit from your offering and (important!) getting THEM to make contact. It's not difficult. The conversation should go like this:
- You: "Hey, do you know anybody who'd be helped by our product?
- Customers: "Well, I know the CIO over at Acme. She might be interested."
- You: "Fantastic! Hey, while we're on the phone, could you send her an email suggested she and I meet? Just a quick one; nothing elaborate. And CC me on the email?"
I've seen some companies set up formal referral programs, like "10% off your next order if you bring in a new customer." However, I'm not enthusiastic about formal referral probrams because the value of a recommendation is that it starts the opportunity with you (the seller) in a position of trust.
That trust exists because the existing customer sees the referral as a way to help out the potential customer by making the connection. However, if you compensate the existing customer financially, the referral becomesa benefit to the existing customer. The prospect will sense that, and see the referral as tainted.
Action item: whenever a customer expresses happiness with your offering, ask for a recommendation and have the customer make the connection.
2. Inbound marketing.
Inbound marketing consists of a website that captures data when people access your website. (Note: a website the simply provides information and a way to contact you is online advertising, not inbound marketing.)
Contact data gathered through inbound marketing has a very short "half life." Research shows you're geometrically more likely to convert a prospect into a customer if you call while they're still accessing the website! Wait a few minutes and the conversion rate plummets.
Even so, you can make previous-gathered contact data somewhat more valuable (or somewhat less useless) by plugging that data into a "drip" campaign of email marketing. However, email marketing is much less effective than the immediate contact that inherent in the concept of inbound marketing.
Action items: 1) prominently and immediately display a widget that solicits contact data (e.g. "Sign up for our newsletter.") 2) Have a salesperson avaiable to immediately call/text/email any customer who provides such contact information.
3. Online advertising.
Online advertising consists of buying ad space online. Such ads typically have links to your website, so online advertising is really a "feeder technology" for inbound marketing.
Making online advertising into a sales lead generationt tool is all about targeting, which means the more you know about your customers (and the people who are seeing the ad), the more that ad is worth to you. (Note: this simple fact is why companies like Facebook will never abandon the mass gathering of user information.)
The great thing about targetting your ads is that the more precisely you target them, the fewer ads you need to run and the less the campaign will cost. In other words, narrowing the focus both increases effectiveness and decreases expenses--the textbook generation of good business practice.
Action item: take a long deep look at your existing customers and then see if you can't further target your online advertising to reach more of the same and not reach people who don't really seem likely to buy.
4. Email marketing.
As I mentioned above, sending a personalized email to a specific individual is lead nurturing, not lead generation. Email marketing as a lead generation method involves sending out an email blast to a list of email addresses.
The goal of email marketing is not to send somebody to your website (that's a step backwards) but to get into a one-on-one email conversation (which, again, is lead nurturing). You then segue the email conversation into a telephone conversation. I've written about this process innumerable times, so I won't belabor the point here.
Warning: email marketing can all too easily lapse into SPAM. Personally, I only do mass emails to people who've signed up for my newsletter. I've never purchased a list and probably won't ever do so. Many but not all of my clients who've purchased a list haven't gotten great results.
Action item: I'm going to make it easy for you. Read the 30 most popular articles I've written about email marketing. You'll learn pretty much pretty much everything you need to know about this kind of lead generation. Note to self: I should probably take the time to put all that stuff into a book.
5. Offline advertising.
I'm not a big fan of printand TV ads because 1) there's no easy way to measure how effective they are and 2) there's a disconnect between the ad and any action that a prospective customer might take.
From what I understand and remember from when I was involved in such advertising, the two keys to doing it successfully are 1) targeting the right audience and 2) repetition, repetition, repetition.
As far as repetition goes, I seem to recall that most people supposedly must see an ad at least nine times before they take action. That sounds reasonable, but it also sounds like a metric that might have been pulled from the butt of somebody who sells ads for a living.
Action item: As with online advertising, refocus on your target market. Avoid the fluff and puff of brand advertising, which is generally a waste of money.
6. Direct mail.
I don't have any deep experience with direct mail, so I'm not going to say much about it. I've met marketers who swear by it, but to me it seems really old-fashioned. I mean, snail mail? However, if some companies weren't getting something out of it, it would cease to exist, right.
Action item: Beats me. Like I said, I really don't know all that much about it, because I haven't used it nor do I have many clients who do.
7. Cold calling.
As I've explained in previous columns, most decision makers no longer answer their phones unless they recognize the number that's calling them. While there are some legitimate salespeople who can create leads with cold calling, they're fighting against the trend. People hate being cold called, which makes it difficult to sell to them. Most of the time, cold calling just not worth the effort.
Action item: Just say no.