The Marketing Plaza

In sales and marketing, lead generation is an ongoing hot button – and, no wonder. According to one data set, the top 20% of customers yield 150% of a company’s profits. Who wouldn’t want more of those?  The proverbial struggle is not just to find customers, but the right ones who can be in your top 20%.

The same data set, reported in a 2009 AMA webinar on customer growth, noted that the bottom 20% of your customers usually cost you money.  In those cases, you might be better off without the added customer base. And that’s the moral of the lead generation story: you never need to find or generate those customers who won’t be profitable.

Timely Leads

Marketing Sherpa reports that “an estimated 70-90% of leads generated by marketing are never followed up by sales.” One reason is that leads are frequently turned over to sales before they  have been fully qualified. That’s not an indictment of marketing. It’s an indictment of the process. It likely took an enormous marketing effort to get the leads and prepare them in a way that they could be seen, sorted, and sent to sales in the required timely fashion.

Time is the enemy of all leads, but time is also exactly what leads need in order to be developed into full-fledged prospects.  Loren McDonald of Silverpop, a marketing engagement firm, notes that there’s a “7 times improvement in sales if leads are responded within 48 hours.” But the flip side of the time equation is that sales generally won’t follow-up on leads that haven’t been qualified more thoroughly. They also don’t have the time.

The Missing Step

There’s a missing step between classic marketing and sales that is too rarely defined or assigned – lead incubation.  Some call it lead nurturing.  Whatever the term, the key is to find a safe haven for all leads where they can be tested, nurtured, warmed and then adopted out to sales.  Part of the problem is short-term sales thinking — a request to marketing to get leads no later than “tomorrow” for a new sales burst effort.

The real problem in lead generation is a lack of planning and process. If either one is missing in a lead program, there will be wasted time, or worse – wasted leads.

Put Time on Your Side

Silverpop and other firms would argue that the solution to the time problem is software. New and improved software solutions score data to prioritize hotter prospects from colder ones. Others argue that the answer lies in creating lead midwives – real people either on the marketing or sales side who can engage the leads earlier enough to establish preliminary relationships and determine their fit with a company’s services.

Neither is an exclusive solution.  Progressive firms are known to use both — scoring software and assigning staff dedicated to lead development. The problem with both is that they frequently miss the point. Both may be geared toward looking for the short-term sales potential of a lead rather than the greater opportunity of developing a loyal and long-term customer.

Some call this “customer equity.” In essence, it’s a move to get away from meeting the short-term goals frequently desired by Wall Street for the benefit of the longer-term health of the company and its other stakeholders. In the new digital world, it is simply called “building community” or “relationships.”

It’s a New Social World

All social media today is about community building. It’s a nicer label for someone who follows you on LinkedIn,Twitter, or Facebook as part of your lead group.  Social media is based on the premise that there’s value in the time spent developing a community. In fact, if a sale pitch is made too soon, or too obviously in the social media realm, the community will literally shun or cast out the participant.

As the world is getting increasingly digital, the need for community relationship building is also increasing. Savvy sales and marketing people were among the earliest adopters of LinkedIn.  They quickly realized the rationale behind building a digital Rolodex. And, the successful ones also saw the value in answering questions, joining groups, and leading groups rather than just “fishing” for a quick close.

Change Partners and Dance

Fishing, in general, is a horrible analogy for sales and marketing programs. Whether you believe in Catch & Release or landing the big one, no customer wants to be likened to a wet fish.  Instead, lead generation, nurturing, incubation and development can be likened to a long, slow dance with sometimes difficult dance partners.  It sometimes feels like a hip hopper paired with a ballroom waltz partner.

My recommendation for any organization – change the music.  Find a drum beat everyone can live with, and determine the dance steps in advance. That’s called setting a process in which everyone knows who’s leading, who’s following, and when specific moves are required.  Then, it’s time to Tango. If specific dancers still can’t cut it on the dance floor, it’s no longer a lead problem. It’s the dancer, and time to change partners.

It’s a new year and a new decade.  No better time to take stock of your marketing commitments and make some serious resolutions. Here are 10 to consider for 2010.

1. Commit to some marketing.  Really, any marketing.  Doing no marketing is called “going black.”  Occasionally there are legitimate reasons to go black, but not now.  The goal for 2010 is to get into the “Black” on your balance sheet and income statement, and that doesn’t happen by going black in marketing.
2. Test something new. Same old, same old doesn’t work.  It’s time to break out and try a new marketing vehicle, be it Twitter or a billboard.  It doesn’t have to be a new fangled social media outlet, it just has to be something you haven’t tried before so you can test its effectiveness.
3. Re-test something old. If you stopped doing print ads because they stopped pulling for you, reconsider the medium with a changed message in a different publication. For instance, move from a trade magazine ad to a consumer newspaper ad, or stop a newspaper ad and move to a biz journal ad.  Don’t throw the baby out with bath water.  Print ads may still work, just in a different pub or with a different message or creative treatment.
4. Go social. Yes, it’s time to do something in the social media world. Create a personal Facebook page, create a Facebook business page, start a Twitter account on a topic of expertise, consider blogging.  Don’t do it all, just get a toe-hold so you’re in the game and can talk the talk.
5. Fish where the fish are. Take a fresh look at your intended audience or market.  Where do they congregate?  If your market is on Facebook, then that’s where you need to be, but if they are meeting regularly at a club hall or in the back of a restaurant every Tuesday, get old-fashioned and show your face at the real-live networking event.
6. Rethink your audience. If sales are flat, is there a new audience out there for your old product?  The classic example is Arm & Hammer’s baking soda being reintroduced as a refrigerator de-odorizer rather than just a baking ingredient.  Does your product have a new audience waiting to discover it for their own special needs?
7. Get back to benefits basics. Stop thinking about what your company or product does, and remember why it’s important to a customer.  What do you really provide? If it’s tires, are you providing reliable safety or wheels that define a personality, rather than just rubber that hits the road?  Remember Harley Davidson doesn’t sell motorcycles. They sell virility to men going through a mid-life crisis.
8. Get help. Marketing takes talent.  From writers to designers to media planners, don’t try to go it alone. You may need staff, but you likely just need an ongoing consultant, ad agency, or marketing service.  Get the help you need at the price you can afford. You can always trade up to full-time staff, or a more creative agency later. It’s more important to get started and learn what works and what doesn’t than wait for the perfect help to come your way, or for the day you can afford the fancy agency.
9. Start early. Marketing takes time. Brochures done on the spur of the moment rarely hit the mark. You want sustained sales not short-term sales. You don’t want to be a one-hit wonder.  Give yourself and your team time to get the message and tone right.  Start now, in January, but don’t look for results in February. Look for results by the half-year mark, year-end, and ever onward.
10. Stay on strategy. Marketing is like exercise. It only works if you continually work at it with a goal in mind and a strategy for getting there.  So don’t start marketing in January and quit by February.  Marketing is not a treadmill.  It ‘s a path to the future. You should never get off it.

If you want help with any step, feel free to call the strategists at Plaza Communications and Consulting Group (www.plazaconsultinggroup.com).  We’d love to help you start the year off right!  Happy New Year to all and Merry Marketing for a Prosperous New Year.