Lead generation is the marketing process by which a company stimulates and captures interest in a product or service for the purpose of developing their sales pipeline.
Generating quality, cost-efficient leads is an important process within the sales cycle of every business.
Have you ever tried to get more leads? Everybody has. But most businesses have failed. You are probably wondering why.
That’s because they are trying to buy traffic and attention and covert people straight to e-mail sign ups or sales… Strangers don’t want to give you e-mail anymore. They know they’ll be spammed. Strangers also rarely if ever buy from a company they don’t know or have never heard about.
You’re better off spending your time finding people who are interested in what you’ve got rather than trying to convince complete strangers to sign up when they don’t want to.
Generating leads doesn’t happen by magic. There is some science behind it.
Buying leads, instead of organically generating them, is easier and in addition it can requires far less time and effort. However, despite being more expensive this is not the way to go. So why shouldn’t you just buy leads?
First and foremost, leads you’ve purchased don’t actually know you. People want to hear from prominent thought leaders.
Why content is the first step to generating leads?
Thought leadership is the most efficient way for a brand to position itself as a leader in a certain field. They can do this by proving its expertise.
The key word here is “prove.” While trying to position itself as expert, a company can’t just say: “We are experts!”
They have to demonstrate they are. The best way to do this is to create content.
For this reason, forging a reputation as a thought leader all starts with creating content.
Content. Lead capture.
You’ve probably heard the old saying that “Content is King”. That’s because great content attracts an audience. With an audience, you can generate leads. And once you manage to capture those leads, you will be able to market your products and services and to make sales.
The type of content you can add takes many forms. You can add articles to your own blog, guest posts on other sites, or write a newsletter that you can send out regularly. You’ll have to decide on the best way to get your voice out into the world.
People don’t want to give away their contact information such as their email address unless you offer them something that is MORE and BETTER than anything they can get elsewhere.
On the web email addresses are the high-value currency of exchange. Why? Because they are equal to leads. And a lead is potential money.
However, you don’t always need to win their attention on the first try thanks to re-targeting. If you want to read more about re-targeting and how it gives you more than 1 chance to grab a person’s attention even if they leave your website, you can refer to our “Ultimate Facebook Marketing strategy” This principle works in a similar way if you advertise on Adwords.
A successful sales funnel begins with a lead magnet.
What is a lead magnet?
A lead magnet is an incentive given away to potential buyers in exchange for their contact information such as name, email, phone number, etc.
Lead magnets are also called:
- Signup incentives
- Signup offers
- Content upgrades
- Some even call them “an irresistible bribe.”
There are various types of lead magnets, most of them are downloadable content like eBooks, white-papers, free courses, checklists, video series, or Cheat sheets/Plans.
What’s the purpose of a lead magnet?
The purpose of a lead magnet is to inspire the people who are consuming your content to get on your email list.
But in order to grow your email list, you have to give people something in return. The psychology concept related to this topic is called the “norm of reciprocity.” Most people are flooded with emails, newsletters and other offer advertisements that the lead magnet must offer them something truly valuable, which solves them a specific problem, in order to add one more email to their inbox.
Webinars are a one of a kind content format. They have become more valuable in the marketing world where the buyer’s journey is now filled with pieces of cultivated content. Enrolling to your webinar means that people have moved beyond the superficial with your brand. They have actually made a commitment to attend your event and listen to what you have to say.
Webinars usually provide better leads than other offers. Webinars should be seen as a way for companies to show a piece of themselves to a targeted audience. When someone is registering to your webinar it means that they are in search of a deeper connection and higher level information.
This main goal of a webinar is to establish that relationship of trust, thereby helping customers feel more comfortable and more open to working with that company in the future.
However, most people make the mistake of running the “Webinar” offer on the first step. People just don’t want to jump on your webinar unless you’ve helped them before!
First, you need to sell them an idea. Visitors won’t sign up to your webinar simply because you’ve placed a form in their path that reads, “Sign up for our webinar.”
Where’s the reason to comply?
Your prospect might not sign up to your webinar right away, but he or she might have a change of heart if you have previously offered them a valuable resource.
When you master lead magnets, you pretty much have superpowers to grow your business
Pursuing unqualified leads is a huge waste of time and will directly impact your overall sales and revenues.
But how can you differentiate which leads are good, from those that should be further nurtured? Guesswork and hunches are not enough to determine which customers are truly ready to buy. This is where lead scoring comes into place.
So, what is lead scoring?
Lead scoring is a marketing methodology for ranking leads in order to determine their sales-readiness. Companies assign point-based systems in qualifying leads, they can score them by implementing rankings like A, B, C, D, or can use terms like ‘hot’, ‘warm’ or ‘cold’.
While every company has its own prospects, without a proper lead scoring in place they will be all the same quality. But, as you have probably guessed, your leads are not all equal. Some leads have just a casual interest in your company, while others leads are looking to make the purchase today.
On the other hand if you go through your prospects contact list one by one you will miss out on some sales opportunities by the time you’ve gone through the entire process.
Here are the four basic dimensions to lead scoring that will help you to separate serious customers from those on the fence.
1. Lead Fit
2. Lead Interest
3. Lead Behaviour
4. Buying Stage
The most basic data you have can help you to learn more about your customers. Demographic data should be the starting point in terms of making heads and tails of your customers.
You can also use age as a determining factor in lead scoring. Other common demographic attributes that most marketers award scores for are:
- Industry segment
- Job title/ Level of seniority
- Annual revenue
- Number of employees a company has
- Geographic location
Assign a point value to each of these key metrics to accurately rank your prospects.
Use this information to hone in on leads that are truly good fits. Unfortunately, there are quite a few companies that don’t know how to build a reliable formula that includes behavioural and demographic data to form lead scores.
Although the visitor’s behaviour is important it fails to paint the entire picture. While most companies focus on behaviours and ignore demographics; the correct ratio should be more like 50-50.
How engaged are your leads?
Have they opened up your emails? What is your click through rate?
How about signing up to attend the webinars you have been hosting? Or maybe they have downloaded your free e-books
All these actions prove that your prospects are actively interested and c.an help you determine how ready them are to make that final purchase.
Is your prospect requesting calls or demos? Or maybe they still are in the early, more latent stages; such as reading your blog posts or maybe they are following you on the social media channels.
Accurately defining the buying stage can help you better score your leads.
Most prospects fall somewhere in your sales funnel:
- Early stage: During this buying stage the prospect is well aware of your brand, and he/she is a regular reader of your blog or downloads the free resources available on your website
- Mid stage: This prospect is downloading resources that ask for opt-in, are checking on the buyer’s guides and may even be using the ROI calculator in order to gather further data.
- Late stage: The prospect is filling out you “Contact us” form, or is requesting a free trail
When a lead reaches a specific point total, they are considered a hot prospect. Knowing when to reach out to a lead can help salespeople stay on track, focus their attention on the right group of potential customers, and be more productive.
Remember that lead scoring is not a set-it-and-forget-it action, it needs to be regularly re-tuned.
The Sales process – How to ensure that leads convert into sales
Getting a lead is one thing, however, turning that lead into an opportunity is a totally different thing. No matter how great your lead generating machine is if you do not have a good sales process you will be missing on lots of opportunities and your money will be flying out the door.
According to MarketingSherpa, an astounding 79% of leads are never converted into sales. But how can you increase the conversion rate?
Converting leads into sales us not something that magically happens. Getting prospects into your sales funnel is good, however, you should not stop there as there is one more step; retaining them.
You will need a strong strategy, and persistence to guide the prospects through the buyer’s journey from start to finish.
First things first: you need to find out how you stand, meaning what is your conversion rate. And here guessing does not work. The first step to increase the conversion rate is to accurately measure it.
So, how many of your prospects turn into customers that actually pay? And what is the percentage of leads that turn into a sale?
By tracking conversions you can find out from where your customers are coming and which strategies have proved to be efficient in turning qualified leads into sales.
Another study that has been conducted by Vantage Point Performance and the Sales Management Association, shows that those B2B companies that have set formal sales process have experienced a revenue growth with 18 percent higher compared to companies that didn’t.
The quicker you follow up on a lead, the better chance of turning that lead into a sale.
According to a lead response survey performed by the Harvard Business Review response times of most B2B leads are very slow. Here are a few unexpected results from the study.
- The average first response time of B2B companies to their leads was 42 hours
- 37% of companies have contacted their leads within an hour
- 16% of companies responded within one to 24 hours
- 24% of companies took more than 24 hours
- 23% of the companies never responded at all
If you do not reply to your prospects guess where they will go?
Your guess is just as good as mine; they will go to another vendor, meaning your competitors.
Optimize for lifetime customer value
In marketing, customer lifetime value (CLV) is a metric attempts to determine the economic of any given customer.
Customer acquisition costs are included in the CLV. The cost of getting a new customer is higher than the cost of retaining an existing one. As a result the main goal of a powerful CLV strategy is to retain customers, and to determine them to increase spending over time. As returning customers spend on average 67% more than new customers, generating customer loyalty should not be overlooked.
CLV is the value a customer contributes to your business over their entire lifetime at your company.
Why is this particular number so important?
It will give you an idea of how much repeat business you can expect from a particular customer in the long run. It can also help you decide on the amount you are willing to spend to “buy” that customer for your business. The money worth spending to acquire a new customer is determined based on the profit generated not by a single purchase, but from the purchases made over a lifetime with your brand.
Assessing your CLV can allow you to dedicate more resources toward the acquisition and retention of high-value customers.
The most straightforward way to calculate CLV is to take the revenue your company earns from a customer and subtract the money you have spent on acquiring and serving them.
Here’s an example to give you a quick and easy estimate:
Let’s consider that your business ‘average order value is $100. Furthermore, the probability of a client coming back and making a repeat purchase is 10%. Finally, we’ll assume that you spent $20 to acquire each new customer.
The total revenue you should receive from each customer is your average order value divided by one minus the repeat purchase rate, or $100 / (1 – 0.1) = $111.11. If you subtract your customer acquisition cost from this number, you will get a customer lifetime value of $91.11.
Focusing on CLV can change your customer acquisition strategy. You can determine which customers have the highest CLV. These customers are known as your VIP customers, and they will give you an insight into who you should be targeting in terms of demographic.
The main methods of calculating CLV are split between historic and predictive CLV:
Predictive CLV is the best way to determine how much a customer is worth to you now and also to calculate how their value will change over the course of the customer relationship.
Historic CLV can be very easily calculated as the sum of the gross profit from all historic purchases made by a certain customer.
If you’re an established company, you probably already know or have an idea about this number; however If you are a new company, you’ll need to make best educated guess about it.
Lead Generation Tools
As we have seen, growing your customer base can be pretty difficult. Therefor in order to take advantage of every opportunity available you will have to get the most effective tools so your team can implement a cost effective and rewarding lead generation strategy.
Choosing a predictive lead generation tool and software platform to use can be quite challenging.
As there are lots of options that claim to do similar things, we have put together a list of the best lead generation tools:
Pipedrive is a cloud-based CRM software that greatly simplifies the sales process. It is ideal for businesses with sales teams and departments that are small in size and have limited tech support. However, it is powerful enough to grow with your sales team.
Pipedrive is highly customizable and brings lots of features to the table.
- With Pipedrive, your pipeline is presented in a simplified, user friendly interface. You will be able to easily divide the deals into different categories, so you can have a bird’s eye view of all the sales stages.
- Visual sales pipeline. Business leads are organized perfectly providing a good overview of your sales, and allow you to focus on the deals that you want to prioritize.
- Pipedrive provides its users reminders, notifications, and follow up features that they can set up to receive via email or to be notified on their mobile devices directly in the app.
- Pipedrive can be easily customized. You can even take advantage of the drag and drop interface to change the user view and create customized workflows that will reflect your sales process.
Pipedrive is primarily accessible via a web application, which is fully mobile optimized. The Android and iOS applications available are friendly enough to make sure your sales teams will love it. It seamlessly integrates various useful applications such as Google apps, MailChimp, Yesware, PandaDoc, Trello, Zapier, LiveChat, RightSignature, Zoho CRM, and many more.
Hubspot is a versatile cloud based marketing software platform that helps businesses of all sizes attract visitors, nurture leads, and close deals. It allows you to analyse business metrics to ensure marketing campaigns are progressing in the right direction.
Hubspot offers a variety of features such as:
- Social Media Marketing. HubSpot comes with basic social media tracking and contact capabilities. You can even schedule and post to social networks from within Hubspot
- Lead Management. Users get to see every detail related to a certain lead within a single contact profile. Now your sales team can get the inside scoop on a lead and they’ll be able to make smart follow-ups.
- Blog and Content Creation Tools. You can even write search engine-optimized blog posts directly within Hubspot
- Marketing metrics with advanced details
- Multiple Deal Pipelines Hubspot can help you break down your deals by regions or verticals
If your company is on the fast path a chatbot is a must. As you customers expect a response within the first hour on reaching out to your business you can use chatbots to connect with customers while they shop or browse through your website
Chatbots help customer support teams eliminate time on the phone by automating the initial contact between a business and the customer.
Human capabilities can only pay attention to one call or take care of just one online interaction at a time, bottlenecking the customer-business communication channel. On the other hand chatbots can revolutionize and streamline this process. Chatbots are a timely solution for a generation that prefers text messaging to traditional means of communication.
If you’d like to learn how to use Chatbots to generate massive amount of leads, create a free account with Talkish here, and you’ll get an invitation to our course after the registration.
Any of the above mentioned software and tools are advantageous to both small-scale and large-scale business ventures while making sure that there are no leaks in your sales funnel. Most of these tools are built so that they can fit the requirement of almost every type of business.