Archive for August, 2009

Sales isn’t following up on marketing leads for a reason

Most people who have studied marketing can tell you that marketing lead generation is about both quantity and quality. However, it seems that in many B-to-B organizations, quality has been forgotten in the quest for quantity. As a result, marketing leads have lost credibility with sales, and are often relegated to the bottom of the pipeline in terms of which leads sales will follow up with first.

It’s axiomatic in the B-to-B marketing space that sales teams just don’t follow up on marketing leads. I went to a Business Marketing Association seminar the other day where the audience burst out laughing when the speaker suggested that this might be a problem in some firms. That meeting was about a different topic, but I heard a number of people from the marketing function speculate as to why sales teams don’t follow up on marketing leads, and they all seemed to focus on perceived deficiencies with sales. I’m not going to defend the world’s sales organizations, but I will suggest that we marketers could use to take a look in the mirror the next time this issue surfaces. At a minimum, it’s a shared problem, and it’s possible the problem lies firmly at marketing’s doorstep.

How do I know this? Well…the sales people at every company I have ever worked for were results-driven. They pursued whatever lead was in their pipeline that was most likely to close a sale. If your sales partners aren’t following up on your marketing leads, that’s likely because they have had experiences that tell them that the marketing leads aren’t as ready to buy as other leads in their pipeline. That means that marketing will need to either nurture leads further before sending them to sales, or provide sales with the tools necessary to convert the current marketing leads into closed sales. Oh, and by the way, if your sales tools require more work than shifting focus to other leads in the pipeline, then you really only have one choice….start nurturing those leads until you have improved lead quality to the point that it is attractive for sales to follow up on your leads.

If you are wondering how to do this, the internet is full of advice about how marketing should go about nurturing leads, often from vendors of software packages that make it easy to manage nurturing campaigns across the spectrum of client and prospect leads. One recent example is Marketo’s The Definitive Guide to Lead Nurturing, which you can get here. In this report, as in all the others like it, you can take the advice with or without the system that they recommend. My only hope is that B-to-B marketers will embrace the key concepts behind lead nurturing, and going forward will accept responsibility for producing leads that are at least as ready to buy as others in the sales pipeline. Once that happens, we’ll stop hearing that sales isn’t following up on our leads, and start hearing a greater demand for leads from marketing.


Which marketing vehicles are right for you?

Nearly all the marketers I have spoken to lately have told me the same thing: after the headcount reductions in their firms, they don’t have enough people on their teams, or hours in their own day, to effectively use all the marketing vehicles that are available to them. They feel overwhelmed by the options, and particularly in regard to the newer social media forms of marketing, believe they lack the expertise to be effective.

I just finished reading The Marketing Accountability Imperative: Driving Superior Returns on Marketing Investments, by Michael Dunn and Chris Halsall. They had a good 7-question filter on page 187 for how to determine which marketing vehicles are right for your firm to use. I thought it might be helpful to folks who find themselves in this situation. If you would like more information on the book, go here.

Imagine the situation where you have the option of using 20 or more vehicles to promote your product, but you only have the bandwidth on your team to master and execute against 5 of them. How do you reduce the list of options to the 5 best vehicles for your situation? The authors suggest that you ask yourself these 7 simple questions that will rule out the least effective vehicles for your situation, and leave you with only the most effective vehicles to execute upon your strategy.

    Does the vehicle logically fit with your specific marketing objectives? For example, print advertising isn’t great at closing sales, and web forms aren’t great at building awareness of a product. Knowing whether your near-term objectives are about awareness or closing sales could help you to eliminate one of these options.

    Will it reach and resonate with your target segment? Press releases are great for attracting the media’s attention, but not so great at getting IT managers’ attention, or imparting a credible message to them, even if they do happen to see the release. Knowing how to reach your target audience, and what would really be credible to them, will help to eliminate vehicles that won’t reach or resonate with your target.

    Does it fit best with your message and positioning? If your positioning is highly technical and your message somewhat complicated, short vehicles like banner ads likely won’t be the best vehicle for getting that message across. Similarly long vehicles like white papers likely won’t be the best way to sell a product that is simply positioned and with a simple message, like buy Coke when you go to the movies.

    Is it well-suited to your company’s skills and execution capabilities? There is a little nuance to this question, in that you and your team have some capabilties today, and can (and should) build others for tomorrow. Think through both your today and tomorrow scenarios before trying to answer this question.

    Does it have the impact profile that best fits the needs of the brand and business? Some vehicles might be perfectly suited to your product and your team’s capabilities, but typically would produce only a small increase in sales, because they only tap a limited audience. That won’t work well for you, if your objectives are large scale increases in sales. Make sure the vehicles you select really have the potential to meet your goals, otherwise they aren’t worth the time and effort you would have to invest in them.

    Does it have the best track record of absolute and relative returns? Before your final selection of marketing vehicles to meet your current goals, look through your team’s past performance on each vehicle, and understand which vehicle has produced the best results relative to your current goals.

    Is it more efficient relative to comparable alternatives? Lastly, before you choose your final short-list of marketing vehicles, make sure you prioritize them on the basis of efficiency. How much resource (money, time, risk) must you invest to get the desired results. Choose those vehicles with the least expenditure per unit of result, and you’ll be sure to get good value for your investment.

Many companies, my past employers included, use one or a few of these questions, often choosing their favorites from the top/strategic end of the list and/or from the bottom/tactical end of the list, but leaving out some of the key quesitons in the middle. Leveraging the whole list of questions should enable marketers to eliminate some of the less-effective vehicles for their situation, thus improving the overall effectiveness of their marketing programs.

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Lifecycle marketing for technology firms - another resource

I recently wrote a blog post about the need for better lifecycle marketing in technology firms, thinking that technology firms could learn a bit about the topic from financial services firms. After that post, I received a great comment from Georgina Thomas who indicated that the pressures to learn about lifecycle marketing are increasing within technology firms in the current economy.

The other day I found an additional resource that might help technology firms figure out what steps to take to improve their lifecycle marketing, and so thought I would post again about this topic. Last month, Aberdeen Group wrote a research report called Lead Lifecycle Management: Building a Pipeline that Never Leaks. It’s posted on the Aberdeen Group website, and numerous other places on the web, but you’ll need to provide all of them with some information about you to get it.

Key takeaways from the report were as follows, that Best-in Class companies are better than the rest of the companies in the study at Lead Nurturing, Lead Scoring and Segmentation and Targeting. Marketing, sales and service leadership at Best-in-Class companies are aligned around the goal of maximizing the number of sales-ready opportunities, and therefore work collaboratively to:

    Document the buying cycle so that employees in marketing, sales and service all have the same understanding of what it takes for the company to get a sale

    Assign responsibility for every stage in the buying cycle between marketing, sales and service

    Assign back-up responsibility, for revisiting an opportunity, if it should fall out of the buying cycle at any stage. For example, maybe sales couldn’t close a particular sale, but the client didn’t buy a competing product either. That opportunity might at some point be reassigned to marketing for further nurturing until they are ready to make a purchase decision.

    Leverage lead management technology, and integrate it with their CRM

    Develop a methodology for ranking opportunities by propensity to purchase

    Display the propensity to purchase ranking in their CRM

    Train their marketing, sales and service employees how to use the propensity to purchase rankings to prioritize their work

    Perform rigorous quantitative analysis on the relationship between their propensity to purchase rankings and actual sales outcomes

    Meet regularly to review successes and failures in their approach to lead lifecycle management

    Feed learnings from sales results back into their propensity to purchase ranking methodology, functional assignments, and understanding of the buying cycle

Lastly, the authors of this report note that Best-in-Class firms apply these techniques to both client opportunities and prospect opportunities. That seemed obvious to me, and certainly has been true wherever I have worked, but perhaps it’s not so obvious somewhere, so I’ve included it here.

I would love to hear your stories about lead lifecycle marketing at your firms.

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Lifecycle marketing for technology firms

A few years back, I switched from marketing financial services to marketing technology products to financial services companies. It didn’t seem like a very big leap at the time, in fact, I told my friends in the financial services industry that I hadn’t really left financial services at all. But it quickly became apparent that things would be very different in my future than in my past. In financial services, products are fairly commoditized, and marketing is important to promote differentiation where there is not much real differentiation. In technology, at least the part of the industry where I worked -enterprise software - the products are much more differentiated, and therefore marketing is much less important. Sure, these companies still need to generate awareness of their brands and consideration of their products, but they don’t need to close the sale with their marketing, they have a sales force to do that. In this respect, it was clear from the start that I had entered a whole new world.

There were other big differences as well, but those took a little longer for me to figure out. For example, the financial services world largely operates on a lifecycle marketing strategy, where potential clients are identified and nurtured until they buy, and then nurtured some more until they buy even more of the firm’s services. These firms tend to think in terms of lifetime value of a client, and not get discouraged by a period of limited (or no) profitability up front while they are still building that relationship. In technology, the marketing model is much more focused on new product launches, and less on the lifecycle of the client. The marketer’s role is to get a product launched with as much “buzz” as possible, so that it opens doors for sales people who are calling into those prospective clients trying to make a sale. In general, I think technology marketers are pretty smart, but on this point, I think they could learn something from their financial services brethren.

What would lifecycle marketing look like for technology firms?
Lifecycle marketing isn’t difficult, it just requires a little more advanced planning and coordination between functions than individual marketing campaigns. You start by identifying the stages in a customer’s lifecycle. This varies by firm, so you should identify stages that are relevant to your firm, but they might look something like this:

  1. Brand Awareness
  2. Consideration
  3. Conversion
  4. Increased Adoption
  5. Increased Understanding of Value
  6. Advocate for the Brand

Once identified, you should assign each stage to a group in your firm. Of course, everyone likely contributes to every stage in this cycle, but whose responsibility is it primarily to execute each stage? For example, is it primarily marketing or sales’ responsibility to initiate brand awareness? Most firms would say it’s marketing. Continue down the list for each stage. Some stages may have groups sharing responsibility, and that’s OK too, as long as it’s explicit, and everyone knows their role.

Once these assignments are complete, determine what steps will be taken by the responsible groups to nuture a prospect or client in each stage, to get them through it to the next stage, and what criteria you will use to determine if they are eligible to move on to the next stage. Success in lifecycle marketing is defined by movement through the lifecycle. Your goal is to get as many prospects/clients as possible through the lifecycle to the last stage, because that is the stage where they are worth most to your firm.

Metrics are also a bit different in the world of lifecycle marketing. Since success is defined as getting the most customers through the lifecycle as possible to that most valuable final stage, the metrics you use need to assess how many prospects/clients are at each of the preceding stages, and how long they have been there, so that you can get a sense of the pace of movement through the lifecycle and the loss rate you are experiencing along the lifecycle. This approach will help you to identify challenge areas in your lifecycle, so that you can increase focus or investment in those areas, as appropriate.

As I said, it’s not difficult, just a slightly different way of thinking that I believe could really benefit technology marketers, as their products mature, and their marketing budgets come under greater scrutiny. Rather than just marketing a product launch, and then hoping for the best, this approach enables marketers to influence future purchasing behavior as they deepen the client relationship, producing revenues that are typically substantially higher than those associated with the initial product launch.

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