As suggested in the May 1st, 2011 edition of Direct Marketing News, “Brands Enhance Lead Generation Strategies” , Juan Martinez says, “A small number of good leads will always trump a large volume of mediocre or bad leads. Generating reliable, convertible leads is vital to the success of B-to-B, as well as B-to-C marketing and sales teams.”
And so the trend toward generating fewer, higher quality leads (rather than simply pumping high volumes of leads) continues. Furthermore, the article reflects the evolving role of the marketing department. No longer can marketers survive toting brand awareness – they are being tasked with finding the right leads to control costs and maximize profit margins.
In fact, Martinez quotes from a book titled, Angel Customers & Demon Customers that the least valuable 20% of customers drain a company’s profit by 80%, while the most valuable 20% of customers generate 150% of revenue. With numbers like that it’s no wonder why companies large and small are working on developing new lead management processes including greater qualification of lead information, lead nurturing and understanding where a lead is in the buy cycle. One of the consulting firms in the article even suggests that marketers have greater opportunity for leads that are nurtured versus the leads that are ready to buy. And when someone is ready to make a decision, they are too far down the process and that your company is not seriously considered. The better lead for the company is someone that you can nurture and get involved with during the process, possibly helping to influence the sale.
This article provides a nice landscape for marketing and sales, large and small, B-to-B or B-to-C, to understand just how critical understanding inquiries, suspects and leads are within your organization. The costs – to marketing, sales and ongoing customer profitability are enormous, let alone the lost revenue opportunity as sales teams work on low return opportunities.