March 28, 2024

Is lead generation killing marketing?

What happens when you stake the value of your contribution to the company on something that you’ll never do as well as someone else?

This was the gist of a very controversial assertion made by a senior marketer from a very well known B2B technology company during dinner at our ITSMA Marketing Leadership Forum (download highlights from the ITSMA Marketing Leadership Forum) when he said: “An overemphasis on leads is damaging our relationship with sales.”

You could hear the proverbial pin drop in the room after he said it.

On the one hand, what he was saying seemed ludicrous. How could emphasizing leads not improve the relationship? The perceptions that marketers send nothing but junk leads to sales and fail to measure the impact of those leads on revenue have been hurting marketers’ relationships with salespeople—and the business—for at least a decade.

But his point was that marketers will never be as good at handling leads as salespeople are. In my research, I’ve never seen anyone claim that marketing contributes anywhere near 50% of the leads that turn into sales. Most anecdotal estimates I’ve heard range from 10-35%.

Now, you could argue that if marketers improved their ability to generate, nurture, and manage leads from start to finish that those numbers would improve.

But can we ever say that marketers will become the leading contributors of leads that wind up as closed business? Maybe if you’re selling Apple iPads, but if you’re selling complex B2B services and solutions? Seems doubtful.

Meanwhile, an overemphasis on leads causes salespeople to devalue the things that marketers really do best. The mysterious arts of reputation, idea marketing, segmentation, and value propositions move from mysterious to stupid in the eyes of salespeople if only viewed through the prism of leads.

In the current climate, the psychosis over leads to continuous pressure on marketers to provide more and better quality leads. The overall success of marketing is defined by increases in those two things.

But, argues this marketing leader, are we going to allow our success to be defined this way? If so, we will never win. Salespeople will never respect us because we will never contribute as much as they do.

While I don’t think we can just walk away from the lead problem and go back to designing logos, I do think we need to compartmentalize it a bit. We need to be measured on what we really do well—the creative, right-brained stuff. Here are some ideas for how to calm the battle over leads:

  • Create a lead system of record. The most contentious aspect of marketers’ contribution to revenue is that it can’t easily be measured. That means installing a system that can follow leads from the website to sales and back again. Marketers can send more leads to sales every year and still be seen as failing because they can’t track those leads. Other functions have systems of record. We need one, too. Within that system, we need to agree on ground rules for lead management—such as the definition of a qualified lead, lead scoring, etc. People respect rules more when they’re written in stone.
  • Agree on a realistic level of contribution. Most reasonable salespeople will agree that marketers can only do so much in terms of lead generation. Sure, the totals should go up each year, but the proportion of leads supplied by marketing can’t be expected to rise forever—otherwise, why do we need salespeople? Sales and marketing leaders should decide on a target goal of proportion of contribution and then get on with it.
  • Split the short term from the long term. It seems only fair that marketers should be judged more for their contribution to longer-term revenue—to the sales pipeline rather to sales themselves, in other words—than to short-term revenue goals. Most marketing leads are people who are not ready to buy. We need to make allowances for that.

We need to get past this battle over leads and get back to doing what we do best.

What do you think?

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We need an app for that

I’ve been working on a report for ITSMA clients this week about analytics and it got me thinking about the proverbial bigger picture of B2B marketing.

We know from our research that we in marketing don’t do much with analytics—i.e., using data to determine and predict customer buying patterns. Only 50% of marketers in our survey said they had analytics programs, and of these, few were focused on predicting behavior; most were simply reporting past behavior. Even rarer is the ability to carry those analytics all the way through to a sale.

But we need to start doing that. Two of the companies I spoke to for my report use analytics to determine which marketing tactics are working and which ones aren’t. That lets them be more productive in marketing, by focusing effort and budget on the good stuff, and it lets them reduce the time to a sale by giving salespeople better tools to work with. One of them told me that it had used these analytics to reduce the average number of interactions needed to schedule a sales appointment in half.

So what are the rest of us to do? I’ve said before that this isn’t just a problem with the issues that come back to us in the surveys: lack of budget, clean data, and unified IT systems. We also have a cultural problem: numbers and metrics just aren’t in our bones; we’re the creative types, what others might refer to derisively as the English majors (yep, me too).

Make the analytics come to us
This is why we have to automate our way out of this problem. The metrics and analytics have to come to us; we can’t continue to expect to dive in and pull them out because we just don’t do it. The things we do and the content we produce need to be contained within an IT system that can watch what we do and tell us about it. This is especially important as more of our work moves online.

But I don’t think you can just start with an IT system, because we’re not much more inclined to be IT geeks than we are to being analysts. So you have to start with the bigger process picture.

I haven’t seen a better articulation of what marketing should be doing in B2B than Brian Carroll’s marketing funnel concept. He differentiates between a marketing funnel and a sales funnel because so many leads are lost in the handover between marketing and sales—94%, according to this report. The marketing funnel helps focus attention on a number of important issues:

  • Qualify leads. Marketing can’t send every lead to sales, nor can it spend too much time qualifying leads.
  • Universal lead definition. A lead that both sales and marketing agree is ready to be pursued.
  • Lead scoring. You can’t call everybody who downloads a whitepaper. You need a system for determining who is ready to talk. And as I discussed in this post, the qualification process needs to be gradual and non-invasive, what Brian has since christened “micro-conversion.” Steve Woods of marketing automation vendor Eloqua has an excellent list of questions to ask about lead scoring here, but I wonder if they rely too much on making people fill out forms.
  • Lead nurturing. There needs to be agreement on when and how a lead will come back to marketing if sales doesn’t pursue it or if the prospect turns out not to be interested.

But what about the fact that sales and marketing don’t talk to each other?
The key to this process is getting sales and marketing to work together create an integrated process. Suzanne Lowe makes the radical assertion that marketing and sales must be integrated together. Eliminate the silos, imbue people with both sales and marketing skills, and eliminate the problem. Once again, however, we have a cultural issue: Sales and marketing people are just different.

The system we’d like to see
In organizations where sales and marketing are forever destined to be separate, processes and systems have to do the integration work. At its foundation, it is a system that sees that the lead process is a loop, not a linear progression—especially considering the length and complexity of the B2B buying process—and is capable of tracking every interaction with a lead over the course of this torturous route.

The system needs to house every bit of content marketing creates, for both customers and sales, and integrates with the lead management system, so that marketers and sales people can use content, not qualification forms, to gauge progress towards a sale. For example, if sales has visibility into the content that prospects are downloading, and both marketing and sales have agreed on the pieces of content that indicate serious buyer interest, the system can signal salespeople to make the call, rather than waiting for marketing to ship the lead to them.

The system needs to be interactive with both prospects and salespeople so that they can rate and comment on the content. And finally, the system needs to integrate with whatever salespeople use (CRM, most likely), so that marketing’s impact on a sale can be automatically tracked from beginning to end.

If marketers had such a foundational system, we wouldn’t need to “create” analytics programs, all we’d need to do is look at what our customers and prospects are doing.

What do your process and system look like?

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How old-school data capture is poisoning marketing and what to do about it

As social media becomes more prevalent in marketing, we’re going to have to rethink how we gather information from prospects.

We’re starting to see social media have a positive impact on driving traffic to websites and on lead generation. In our recent Web 2.0 survey, (all ITSMA clients can download this executive summary), we found that “increased web traffic” was the most frequently cited benefit of Web 2.0 efforts so far (by 67% of respondents). “Increased lead generation” was farther down the list—24% are seeing it.

Now that may be due in part to the fact that most B2B marketers have only recently begun using Web 2.0 in their marketing—fewer than 35% of marketers in our survey have been using blogs or podcasts for more than one year, and just 3% have been using social media (LinkedIn, Twitter, Facebook, etc.) for at least that long.

Social media and lead generation go together
But there is a natural link between social media and lead generation. It is a natural way to drive traffic back to your site for registration—as long as you have great content to offer. And those who are beyond the experimental stage with social media are already seeing this benefit (24% ain’t bad given the nascent nature of this stuff). Indeed, some B2B early adopters are seeing 10-15% of their lead totals generated through social media, according to this survey by DemandGenReport.

Given the potential for lead generation through social media, the question then becomes how much information should we try to get from people coming to us through social media? I think the inherently casual (social!) nature of social media means that we should err on the side of less information.

Should we not capture any data at all?
B2B marketer Tom Bottom got me thinking about this issue this week with a daring post that questions whether we should be doing any data capture at all. He argues that putting a data form in front of a prospect displays a lack of confidence in the quality of our work and at worst drives people into the arms of competitors. In the epiphany stage of the buying process, we should be offering people great information, not turning them off by trying to sleaze information out of them when they’re nowhere near being ready to buy. Data gathering should be reserved for the interest phase, when people are creating a short list of providers and will more willingly put up with being a prisoner of data capture.

Meanwhile, Blake Hinckley cites a stat from Marketing Sherpa that says that the data we’re capturing is garbage anyway because 71% of people lie on the forms. I’m a little skeptical about taking that stat at face value. There are plenty of cells on data forms (too many, in most cases) so people may be lying about things that don’t really matter anyway. In my experience, IT prospects tend to lie about their titles and their level of interest because they’re afraid that they won’t get the best content or treatment if they admit that they’re trapped on the help desk instead of wielding that big stick of decision-making. But is that lead totally useless? I don’t think so.

Get data through actions, not words
But Blake is on to something when he talks about a concept called passive profiling, in which marketers gather data based on the kinds of content they are offering to prospects rather than through forms. Prospects are only required to give up their names and emails to access content that then tells the marketers how interested the prospects really are. He offers a great example from a client:

“For example, in our campaign with Level 3, a leading fiber-based communications company, we tracked whether prospects downloaded a vbook. Since the vbook explains the need for reliable connectivity (Level 3’s product), if the user browsed through several sections, we could reliably consider them a warm lead. The vbook also contained a Level 3 Network Map embedded as a PDF. If prospects downloaded it, we can assume they were checking if their building or business is within Level 3’s fiber network. PDF-checkers were hot leads, interested in Level 3’s solution, so we quickly passed these leads off to Level 3’s sales team to make the call in time.”

Sync your content to the stages of the buying process
He later says that the decision between active and passive profiling shouldn’t be so binary—that you can mix a little bit of both. But I think that assumes that we are actively (sorry) thinking about how much data we should be capturing before we start to piss people off. I don’t think we’re doing that. By default, we try to get as much as we can, because we figure sales is going to rip us up if we don’t—or because we figure free content (that wasn’t free to us—we killed ourselves creating it) should have to come at some kind of price.

But I think Tom has a great point when he says that there’s not much reason to be asking people for a lot of information during the early stages of the buying process. That’s why it’s important to sync your content to the different phases of the buying process and let that drive the kind of data you try to gather.

Stop collecting this data
For the epiphany and interest stages of the buying process (which is where most of us play anyway), I think we need to practice passive profiling wherever possible, and when it isn’t possible, we should slash the data forms to the bare minimum. Here’s what I think the forms should ask for:

  • Name
  • E-mail
  • Would you like to subscribe to content about this business issue? (Writing clear headlines and descriptions is important.)

That’s it.

Things to banish forever:

  • Address (Why would I want to engage with anyone who wants to send me snail mail?)
  • Title (totally meaningless and a prime reason to lie)
  • Company (so we’re a client/not a client; what does that have to do with anything at this stage of the buying process?)
  • Level of interest (we’re here because we’re interested in learning about business issues, not your products)
  • Budget (with the complexity of the stuff we’re selling, this data would be crap anyway)
  • Phone (c’mon—it’s a new century)

Data forms act like social media doesn’t exist. A combination of conversational engagement and great thought leadership content are what we need to engage with customers in the coming years, not qualification forms.

What do you think?

Check out the B2B Marketing Zone

In keeping with my recent post about being part of the B2B online marketers guild, I wanted to point you to the B2B Marketing Zone, where Tony Karrer has done a nice job of building a list of relevant B2B marketing blogs (including mine—thanks, Tony!) and offers a handy summary of all of them so you don’t have to visit a bunch of different sites to see what’s going on. Another great example of the aggregation blog strategy that I was talking about.

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