Harvest Time - Is The Fruit Edible?
A number of years back I was lamenting to a friend that the company I work for was not generating enough new business. This fellow, who has been a marketing wiz for his entire career, made somewhat of a flippant reply that our basic problem was that we did not generate enough leads. It was an intensely obvious point, but at the same time, it was a significantly profound revelation for me.
Back then our business model was entirely based on partner referrals – a software partner would sell licenses to a new customer and suggest that we assist with the process of implementing the software. Back in 1999 it was a reasonable way of doing business, as we were riding a strong wave of CRM expansion (and it did not hurt that we aligned ourselves with the market leader).
When the market started to pull back, so did our alliance referrals, and we became heavily reliant on our installed base for generating revenue. However, this segment can only deliver a finite pipeline that needs replenishment continuously. So, we took control of the helm and went after new business development independently. Since then we have been quite successful in identifying, on our own, companies who are in need of the services we provide. This business development capability is something that most people refer to as lead generation.
This was a fundamental change to our business model that has had very positive results. I can’t imagine how we could be successful today any other way. However, what surprises me is how many of my clients don’t have this fundamental capability in place, or don’t have a fruit-bearing lead generation mechanism cranking out opportunities for the sales organization.
So, I have decided to explore this situation a bit further. Why is such a fundamental business development capability less mature for so many companies?
One of my early conclusions from this ongoing investigation is that the typical sales organization is not confident that lead generation from a marketing function can actually bear edible fruit. The perception that investments in lead generation, beyond the obligatory trade show attendance, will be fruitless serves as a limitation to business development success. Ultimately this causes a self-reinforcing negative loop. Marketing remains under-funded and provides only sour or un-ripened leads, while field sales is rewarded with higher commission rates for bringing in new business. With this the perception that the field must perform its own hunting remains solidly in place.
If you find this to be the case in your organization, I suggest that you look at a way to break that cycle. There are challenges to overcome. First, marketing has to get funding to build a lead generation function correctly. Buying worn out lists and pounding them further with spam is the best way to prove to the field that they should do their own hunting. Building a process to identify interested prospects, then nurturing those leads until maturity, and, finally, qualifying opportunities before handing off the lead to sales is the only way to begin changing perceptions in the field. However, it will take some time.
Don’t give up after the first pilot hands out leads that are ignored. The sales reps will need to see a solid trend of qualified leads hit their inbox or home page before they will be won over.
Feedback on lead relevance is also key to making this all work. Understanding which leads, and which lead sources are generating true opportunities is the best way to optimize the lead generation tactics. But one caution - feedback is not the easiest thing to get back from sales (quality feedback that is).