(Cartoon courtesy to Kenny Madden)
I once worked with the then SVP, Marketing of a large public company who was frustrated with sales. Big surprise. At one point he got so angry that he offered sales management the following choices for spending a $100,000 budget to generate leads. They could choose one of the following:
- 200,000 targeted contacts (name and title) in the right vertical (no email addresses)
- 100,000 companies with up to three executive contacts in the right company (no email addresses)
- 20,000 companies with multiple contacts and verified technical environment information in the right companies (no email addresses)
- 4,319 contacts who downloaded a white paper but may or may not be in targeted companies or have any need or authority to buy (email addresses, many bogus and no company firmographics and no telephone numbers)
- 117 appointments with people in the right companies but may or may not have any need or authority to buy
- 81 highly qualified sales opportunities with the right contact who has a need backed by some form of compelling event
Guess which one they chose? None of the above. They did not even respond. This offer was made because marketing was providing option #6 above (using PointClear to generate the highly qualified leads), but sales follow-up was poor. If they responded at all, it was with one or two phone calls, without any research and without any compelling message other than “looking forward to talking to you.” For details on how sales should follow-up on a lead click here.
It would have taken a target market of about 2,000 suspects to generate 81 highly qualified sales opportunities. Alternatively, the same amount of money would buy 4,319 whitepaper downloads. The last time we tested 9,000 whitepaper downloads for the subsidiary of a large software company, 98.2% of these so-called leads were not qualified (either by company or by title). In the case of the whitepaper downloads sales ended up ignoring the “leads”; but marketing said that at $23.15 per download they were too important a source of leads to drop so they kept buying them and sent them directly to sales (who ignored them). A waste of $208,350 per year – I KID YOU NOT!
It is important for everyone in an organization to agree on the definition of a lead, and it is likely that this will not be a joint decision between just sales and marketing. Executive leadership is required for this to get done and work. It is also important to establish a judicial branch to manage exceptions:
- Any leads proactively returned to marketing by sales – reason? Fix if they are not meeting the lead definition.
- Leads not progressing from Marketing Qualified Lead to Sales Accepted Lead – reason? Fix lack of effective follow-up by sales.
It is unlikely that you are going to be able to buy a high-quality, sales-ready lead for $50. How much should a lead cost? Probably more than you think but probably a lot less than you are paying.