Truth #2—Your Sales Force Needs Fewer Leads
Your sales reps don't need more leads. They need fewer leads. Or more accurately, fewer raw, unfiltered, unqualified leads.
A lead is a general classification of an individual or company with an actionable need for a product or service. Short-term leads, what I also call qualified sales opportunities, generally have the potential to close within one or two sales cycles.
Only a small portion of freshly generated leads typically fall into the short-term category. The root of the broken lead generation "system" is that little or no effort has been made to determine whether each raw lead has any potential at all, much less whether it is short-term or long-term.
Whose job is lead filtration, qualification and development? In my observation of how hundreds of companies treat leads, the bulk of the work overwhelmingly rests with sales—and that is a recipe for failure. Even if leads are pre-qualified, sales people are notoriously poor at following up on any leads but the "hottest." In fact, experts say, sales does not follow up at all on more than 70% of leads provided to them.
Management rightfully motivates and compensates sales people to focus on making immediate numbers, not on building a pipeline of prospects. To fully leverage the talents of your sales force, don't expect sales reps to filter leads, qualify them, and then cultivate the long-term ones until they are qualified sales opportunities. They just won't do it!
Traditional marketing departments are also not the best equipped for this important job. They are filled with brand builders or communicators who do not possess lead management skills and technology. Plus, they're usually measured on "response rates" and so-called "cost-per-lead," (the wrong metrics, but that's another article) which certainly doesn't incent them to fill the forecast.
In my experience, best practices suggest that a separate group, inside or outside the company, needs to take control of the vital lead development function. Think of this group of specialists as lead farmers—they qualify raw leads, nurture lukewarm prospects into the "hot" category, and turn the developed leads over to the sales force for harvesting. Often this process takes months.
A developed lead is one that sets the stage for relationship selling. A lead "farmer" equips the sales rep with in-depth knowledge about the prospect. With advance insight into the prospect's motivations, pain points and buying plans, the sales rep can engage the prospect in a consultative conversation rather than launching into a cold-call presentation or a discovery interview.
Far too many companies evaluate marketing's success by the number of leads they hand over to sales. These companies do not have effective processes and methodologies to track anything other than the number of leads generated and their cost. Many of the same companies fail to hold sales accountable for closing the good leads and for reporting back results that feed the marketing and sales model. The overall result is often wasted marketing dollars and wasted sales time. Click to read "Why Your Sales Force Needs Fewer Leads"