Understanding lead management
Are you looking to expand from a founder-led sales process to something more advanced? Then you need to manage your sales pipeline with the right technology, team and strategy.
Lead generation strategies
Lead generation involves attracting interest in your company via sales and marketing. How you do this varies a lot based on your budget, offering, tech stack and the size of your marketing department.
For brevity, we will cover four successful approaches used by high-growth teams.
- Content marketing and SEO
- Social media
- Paid advertising
- Cold outreach
Content marketing and SEO
Showing your expertise through search-optimised blogs and videos can build trust with your target audience. Ideally, you would usher your ideal customer to a well-optimised landing page with a compelling call-to-action.
One thing to consider is that SEO can take time to compound and requires a significant investment of time and marketing resources to get off the ground. If you need quick sales, you should combine it with another approach, like paid media or sales outreach.
Social media can be a great platform if you have sales leaders with strong personal brands and a solid content strategy. You can repurpose and share content, participate in industry discussions, and nurture customer relationships.
However, social media also poses some challenges. Balancing promotional posts with engaging and authentic content can be complex. Additionally, selecting platforms that align with your audience's preferences and demographics is crucial. Sparktoro is an excellent tool for researching your target audience, the platforms and the content they prefer.
Paid advertising can effectively target buyers further down the sales funnel. Google ads, Facebook and LinkedIn offer the best channels. Search is the most common online method buyers use to research purchase decisions, and social platforms have advanced targeting and personalisation options.
Keeping on top of your customer acquisition cost is crucial to ensuring sustainable growth. If you don't, you risk funnelling money into advertising campaigns with unsustainable profit margins as you scale.
If you are a new brand entering a crowded space, or creating a new category, your marketing tactics may be limited. If you are also limited by budget, you may rely on word of mouth to grow and run into obstacles.
An alternative approach is to use cold outreach. This can be via phone or email and can help you reach prospective customers.
Outreach campaigns are ideally coordinated between marketing and sales departments. This can ensure a consistent strategy, messaging, positioning, and data flow between each team to improve future campaigns.
Seeds, nets and spears
It's also worth mentioning another way of considering lead generation that incorporates the four elements above.
"Seeds, Nets, and Spears" is a framework that sales and marketing teams use to describe different customer acquisition strategies.
- Seeds are sales techniques focused on cultivating long-term relationships and building brand loyalty. The seeds metaphor refers to planting a small investment (like giving free value, advice, or content), nurturing it (with further engagement, support, or additional value), and watching it grow into a profitable customer relationship. It's essentially a word-of-mouth strategy where happy customers spread your brand organically. This is often the slowest method of acquiring new customers, but it often yields loyal customers with high lifetime values.
- The nets strategy captures as many potential leads as possible, like casting a wide net. It's typically associated with broad marketing campaigns like online ads, email blasts, social media posts, etc., aimed at a broad audience. This approach can generate a large number of leads, but they may vary in terms of quality and relevance.
- The spears metaphor refers to choosing and going after a specific target. It involves high-value prospects that a company identifies and then pursues directly, typically through personalised outreach such as account-based marketing or sales calls. This strategy often requires more effort per potential customer but can yield high-value contracts.
Effective sales organisations would typically use a balanced combination of seeds, nets, and spears, adapting the ratio according to their product, market, and business model.
A crucial aspect of managing leads is identifying and scoring leads to disqualify bad fits and focus on your ideal customer profile. In this section, we will discuss the process of creating criteria for lead scoring and explore the concepts of hot, warm, cold and bad fit leads.
Lead scoring is a powerful tool for prioritising leads, ensuring sales teams focus on the most promising prospects. To develop criteria for lead scoring, follow these steps:
- Identify the key factors that indicate a prospect's interest in your product or service
- Assign a numerical value to each factor
- Track and evaluate prospect behaviour based on these factors
- Score each lead according to the accumulated values.
By implementing a lead scoring system, sales teams can efficiently allocate their resources, focusing on prospects more likely to convert.
What are hot, warm, and cold leads?
Understanding the differences between hot, warm, and cold leads can help sales teams effectively target their efforts for maximum results.
- Hot leads are prospects who have shown a strong interest in your product or service, have a clear need or problem that your offering can solve, and exhibit traits that indicate being sales-ready. Hot leads often have a higher lead score, making them a priority for sales teams to pursue.
- Although they have shown some interest in your offering, warm leads may not be as far along in the sales cycle as hot leads. They may require further nurturing through marketing efforts before they become sales-ready.
- Cold leads are contacts who have not yet demonstrated significant interest in your product or service. They might need additional nurturing through cold outreach campaigns or a different approach altogether.
What makes a lead a bad fit?
Ideally, every lead generated by your marketing team is a great fit. But, realistically, you will have a portion of enquiries that are unsuitable or unprofitable.
This could be a combination of factors outlined below.
You may be used to dealing with large enterprise clients with hundreds of employees, and smaller operations are not financially viable.
Conversely, you may be more suited to startups because larger firms' procurement and legal requirements are too complex to deal with.
They want enterprise-level features on a startup budget. Over-promising to drive a quick sale does not make sense if these features aren't planned.
You may be focused on a specific industry or niche. This is common in specialised B2B services. For example, selling professional services (recruitment, accounting) to the technology sector.
Inability to service
You may not be able to handle specific requirements. For instance, you have a SaaS without Single Sign On (SSO) in your roadmap, which is an essential requirement for certain buyers.
Not a buying decision-maker
This is not always a factor, but often you want to deal with someone who can influence the purchase decision. Particularly if the cost and implementation times of your product are pretty low.
For high-cost or high-risk products, you may be selling to a buying committee, in which case dealing with someone coordinating the purchase decision can work out fine.
Not ready to buy
Sometimes, you have engaged a prospect too early in their purchase decision. They may be aware they need to buy but are not prepared to make a decision.
This group are not necessarily bad fit leads. Instead, they should be nurtured further through consultative selling or marketing efforts.
They have not provided legitimate business info
If your lead enquiry contains Gmail or Yahoo emails and you are selling enterprise deals of 5-6 figures, it could be challenging. In my experience marketing to B2B audiences, enquiries from free email domains are unlikely to pass financial due diligence and risk management tests. It is relatively cheap to set up an email domain these days.
Similar challenges occur if you are given invalid phone numbers. Your sales teams are more grateful for legitimate numbers because closing deals over the phone can be more straightforward.
Building trust through lead nurturing
Establish and maintain relationships with those who show interest in your products or services to keep your brand top of mind. Provide ongoing value through email campaigns, informative content, and social media interactions.
Sales reps play a crucial role in lead nurturing. They establish relationships with prospects and guide clients through the customer journey. Trust-building is essential for long-term success and increased sales revenue.
Sales representatives should:
- Listen to prospects' needs
- Provide valuable information
- Follow up consistently
A tailored customer journey fosters loyalty and optimises lead conversion.
Conversion rate optimisation
There are two elements to improving conversion rates.
- The channels that attract leads
- How leads are allocated
Improving marketing channels
You should optimise specific channels to enhance the quality of leads and the likelihood that they will convert to sales.
- Website. Aside from ensuring visitors can find your site, you should ensure landing pages are user-friendly with clear calls to action.
- Email marketing. When a potential customer engages, do you have a personalised email sequence that succinctly addresses any concerns or pain points they have?
- Social media posts. Similarly, do you cover these pain points in your social content?
Leveraging these channels facilitates lead nurturing and, ultimately, higher sales.
Lead assignment - provide the right leads to the right sales reps at the right time
Who you pass leads to is a significant factor in their likelihood of converting. Your agents likely have different skill sets, and understanding this is key to effective sales.
To paraphrase some of Jason's concepts, it is recommended that you:
- Segment leads early and encourage specialisation. Some reps are naturally better at high-volume, fast-closing smaller deals. Others excel at the bigger enterprise deals that can take longer to get over the line. You can also segment based on leads that come inbound or outbound, as well as regionally.
- Use lead scoring. Identify where the leads fit and ensure that even the lower-scoring leads are assigned to someone. A junior sales rep, for example.
- Implement Service Level Agreements (SLAs). This will ensure leads are appropriately actioned. Most importantly, they are actioned quickly. Jason suggests reallocating leads that aren't responded to within 24 hours.
Strategies for expanding sales revenue
Increase the lifetime value of customers through retention
Focusing on existing customers is a wise choice for improving sales revenue. Improving customer retention and increasing the lifetime value of customers can lead to great results.
One way to achieve this is through loyalty programs incentivising customers to return and make repeat purchases. In a B2B environment, providing dedicated customer success teams and account managers can strengthen relationships and build trust.
Upselling and cross-selling
Expanding sales revenue also involves implementing upselling and cross-selling tactics. Upselling encourages customers to purchase a higher-priced, premium version of the chosen product, while cross-selling suggests complementary goods or services that can be added to their initial purchase.
These strategies can stimulate sales growth by addressing customer needs and providing additional value.
Furthermore, implementing referral programs can amplify these efforts. Satisfied customers are likelier to recommend a business to their friends and acquaintances, increasing the potential buyer pool. This word-of-mouth marketing helps obtain new leads and contributes to revenue expansion.
Using technology to improve lead management
Choosing the right CRM and lead management software
Customer relationship management (CRM) tools can automate lead management tasks, track interactions, and monitor overall performance. In turn, these insights can inform ongoing adjustments to sales strategies, ultimately boosting revenue.
Selecting the right CRM is crucial. It streamlines sales processes, promotes efficiency and helps in managing leads. Consider features like integration, automation, and customisation. Some popular options are Salesforce, HubSpot, and Zoho CRM.
It is also vital that you maintain good database hygiene practices and keep your CRM records clean and accurate on an ongoing basis.
Tracking and monitoring leads
Use Google Analytics to track and monitor lead behaviour. This data provides insights and helps tailor marketing strategies. Benefits include:
- Detecting high-conversion sources
- Identifying sales funnels bottlenecks
- Enhancing user engagement
Implementing the correct CRM software and tracking tools will improve your lead management process, increasing sales revenue.
How do you turn leads into sales revenue?
Think of it like planting a garden
- Plant the seeds. Content marketing, social media, and ads draw people in. It takes time and care.
- Cast the nets. You need tools to sort the leads. Imagine a fisherman's net, wide and ready.
- Throw the spears. Some targets are special. Aim and strike directly. That's what cold outreach is about.
- Use your tools. Gardeners have spades; you have CRM tools. Dig into data.
- Nurture the growth. Like watering plants, keep customers happy. Upsell, cross-sell, build trust.
- Watch it grow.
With the right care, your revenue garden will thrive. It's an art, science, and a bit of green thumb. It's the heart of sales success.