What’s Working In Lead Generation: How To Spend Your Time, Money, & Energy For The Best Marketing ROI In B2B Professional Services Research Excerpt: 6 Lead Generation Insights for 2007 Report Authors: Mike Schultz, Publisher, RainToday.com Andrea Meacham Rosal, Chief Content Officer, RainToday.com John Doerr, Principal, Wellesley Hills Group 600 Worcester Road, Suite 301 Telephone: 508-405-0438 Framingham, MA 01702 URL: www.raintoday.com
Transcript
What’s Working In Lead Generation:
How To Spend Your Time, Money, & Energy For The Best Marketing ROI In B2B Professional Services
Research Excerpt: 6 Lead Generation Insights for 2007
Report Authors:
Mike Schultz, Publisher, RainToday.com
Andrea Meacham Rosal, Chief Content Officer, RainToday.com
John Doerr, Principal, Wellesley Hills Group
600 Worcester Road, Suite 301 Telephone: 508-405-0438
Across the board, professional services firms are looking to generate more leads in the next two years. According to BtoB’s “2007 Marketing Priorities and Plans” survey, acquiring new customers (i.e. lead generation) is the number one goal for 2007 cited by 62.3% of respondents1. In studying What’s Working In Lead Generation, we asked 731 professional services firms, “In the next two years, how do you expect your lead generation efforts to change?” An overwhelming 84% said that they were planning on significantly or moderately increasing their lead generation efforts. In other words, 84% of your competitors are going after your prospects and your clients with more lead generation energy, resources, and rigor. So, what lead generation strategies and tactics can you employ that will put you ahead of the curve? In What’s Working In Lead Generation, we set out to answer this question. Our goal is for you to use this report in discussion as you: • Benchmark yourself against “Excellent” lead generation companies in
terms of how much you are spending, what tactics you are using, what your offers are, what your marketing mix is, etc.
• Choose which tactics you should test – and which tactics may not be worth the work and investment.
• Defend your lead generation plans to your managers and gain buy-in with your lead generation team.
• Budget for upcoming years. In this report introduction, we have presented an overview of some of the most important lead generation insights gained from our analysis of the data and our everyday work with professional services firms.
1 BtoB Online, “2007 Marketing Priorities and Plans” survey, December 2006.
We asked: Of the sentences below, which ONE better describes your company's reputation reach?
Sentence % Respondents
Our company is very well-known among the majority of companies in our target market.
30%
Our company is not very well-known among the majority of companies in our target market.
70%
Impact of reputation reach
Respondents who said their companies were “very well known” in their target market were also significantly more likely than the “not very well known” companies to say they were “Good” or “Excellent” at generating leads for their services.
Continued on next page
Companies' Overall Ability To Generate Leads- By Reputation Reach In Target Market -
5
30
1612
44
38
6
49
0
25
50
1(Poor)
2(Fair)
3(Good )
4(Excellent)
% R
espo
nden
ts
Very Well Known Companies (N = 221)Not Very Well Known Companies (N = 514)
Each measure in this chart represents a significant difference, at a 95% confidence level.
One argument seems to never go away. On the one side you have people who say, “We need to increase our brand recognition in order to truly succeed with marketing.” The other side typically maintains, “Just get out there and sell. Name recognition doesn’t matter.” Recognition and reputation do matter when it comes to lead generation. 65% of well known companies report being good or excellent at lead generation whereas only 44% of the not well known companies report being good or excellent. If you are well known, whatever lead generation tactics you employ are likely to work better. In How Clients Buy: The Benchmark Report on Professional Services Marketing and Sales from the Client Perspective, we asked 200 buyers of professional services how they find and learn more about potential service providers. After referrals, “I already knew about the service provider” (a.k.a. reputation or brand reach) was the top approach cited along with, “learning about the service provider by hearing them speak.” In What’s Working In Lead Generation, only 30% of companies claimed the power of name-recognition in their market. That spells opportunity for the other 70% of firms. The more well known you are, the better your lead generation efforts will work. Of course, this begs the question, “which comes first, the chicken or the egg?” or in this case “the brand recognition or the lead generation success?”
Caveat: Don’t build brand for brand’s sake
While brand perception can have a tremendous impact on a buyer’s attitude toward a company, and disposition toward purchasing services, the traditional laws of branding do not apply to professional services firms. Of 33 lead generation outreach tactics, traditional advertising media scored very low in terms of effectiveness: • Advertising on TV: 33rd out of 33 • Advertising on the radio: 31st out of 33 • Advertising in print media: 29th out of 33 • Advertising in ad-supported websites & online publications: 28th out of 33 Build your service brand through your lead generation efforts. With value in marketing, sustained over a long period of time, you build awareness and esteem for your firm’s services while you generate leads.
We asked: How well does your company know whom it should be targeting for its services, in terms of: • The general profile of your target market (best industry, geography, size,
other general characteristics) • The actual titles of decision makers within the target organizations • The actual names of the organizations you should target • The actual names of decision makers within the target organizations
Target market knowledge
Participants rated their knowledge to be: 5 = Extremely Strong, 4 = Somewhat Strong, 3 = Neither Strong Nor Weak, 2 = Somewhat Weak, 1 = Extremely Weak
Continued on next page
% Rating Target Market Knowledge As "Extremely" or "Somewhat Strong"
While the chart above showing “total” responses is helpful to see the overall trend in professional services, looking at target market knowledge by the companies’ self-reported ability to generate leads takes us a step further in underscoring just how important it is to know your target market well. rget market well.
Continued on next page Continued on next page
% Rating Target Market Knowledge As "Extremely" or "Somewhat Strong"- By Overall Ability To Generate Leads -
Targeting and segmentation are the first steps to any lead generation or marketing effort, and must be done with the utmost thought and rigor. It seems intuitive – to be successful in marketing and lead generation, you need to know who your best potential clients are. Yet, only 30% of respondents indicated that they have the actual names of the decision makers in the companies they are targeting. When we look through the lens of the respondents’ ability to generate leads, we see a marked difference in target market knowledge between “poor” or “fair” lead generators (13% - 21% know the names of the decision makers) and “Good” or “Excellent” lead generators (39% - 51% know the names of the decision makers). There’s a direct correlation – in our data and in our experience – between companies that know exactly whom they target and how well they can generate leads.
Caveat: Not all prospects are created equal
While the more knowledge you have of your target market heightens your ability to generate leads, it is important to remember that not all of your targets are equal in their profit potential. As such, not all of your targets should be treated equally in terms of your marketing efforts and budget. The first step in knowing where to spend your lead generation money is to know who you want to spend it on.
We asked: Consider the past 2 years of lead generation for your company: all of the ways to contact prospects, ways to establish brand and thought leadership, ways to publicize and network, and lead-generating offers your company has used. Based on what you know about the source of your company’s leads in the past 2 years, what have been the top 3 ways that have generated quality leads for your company’s services? These may be a single strategy, tactic, or offer, or a particular combination that you’ve found to be the most reliable source of quality leads. Important note: These answers were unaided by the survey, meaning we received 1,428 volunteered responses from 591 participants, with no prompting from the survey as to the tactics they could choose from. We then analyzed and categorized each response individually.
The top ways to generate quality leads
When considering only the answers to what people consider their “#1 top way to generate leads,” these 5 strategies rise to the top of the list:
5 Most Common “#1 Top Ways” To Generate Quality Leads
Personal relationships / Direct, face to face contact 8
When considering all of the top 3 ways to generate quality leads, priorities change, but not substantially. Client and partner referrals, general referrals, cold calling / telephone prospecting, and interacting with prospects at events still reign.
The great debate: to call or not to call
Cold Calling is second only to referrals as the number one lead generation tactic respondents cited that has worked for them in the past. While there is much debate over the topic of cold calling – if it works, if it is worth it, how to do it “right” – the data here is clear: cold calling does work for a number of firms. The following verbatim comments from our survey respondents explain how it works, and how they know it works.
Comment From Even though calls are frustrating at times...when they work, they really work well. We can get 2 to 4 new clients each year this way, that usually turn to repeat work clients...that is good.
Chief Marketing Officer, AEC Services
Our biggest and most profitable customers have been acquired this way.
CEO / President, Health Care Services
75% of more than 250 meetings during the past 2 years have been generated this way.
VP / Director of Marketing, Management Consulting
30% response rate with a 10% first meeting rate. Acts like the newsletter, but gets to an audience blocked by spam filters.
Principal / Partner, Human Resources / OD Consulting
Roughly 25% of new business is brought in this way. Principal / Partner, Retained Executive Search Services
Cold calling is so rare in UK professional services that it's quite a pleasant surprise to many recipients. We often get the comment, “I'm glad you called. I / my colleague is dealing with just such a situation that you may be able to help with...”
Managing Director / Managing Partner, Marketing / PR / Advertising
70% of correspondents are interested in our services. Principal / Partner, Law Firms / Legal Services
Comment From Be honest & to the point, don't waste their time, research them before calling, ask good questions, LISTEN to their answers, keep good notes, follow up, follow up, follow up.
Chief Marketing Officer, Architecture / Engineering / Construction Services
The more tailored the call based on pre-call research, the more effective it becomes.
Chief Sales Officer, IT Services & Consulting
It is how we have secured business year after year and we're over $400 million in sales and in business over 50 years.
Field Director, Human Resources / OD Consulting
Defining the target audience. Principal / Partner, Law Firms / Legal Services
The key is to make it a professional inquiry, not a sales message - I say that I've seen their work, tell them briefly what I do, and ask whether they'd be interested in seeing some additional information (white papers, cap statement, etc.).
CEO / President, Marketing / PR / Advertising
Our service is not something that a client thinks of getting and, often doesn't want to . . . they want the results, not the service. So, calling – proactively – has been hands down the most effective way to generate leads. But not for the faint-hearted!
VP / Director of Marketing, Management Consulting
The key is to ensure the call is always client business focused, and by a senior manager who can bring their industry experience to bear.
VP / Director of Marketing, Marketing / PR / Advertising
Needs a high quality individual who knows our business well, and is able to hold real conversations, not just follow a script.
Chief Marketing Officer, Training / Executive Education
The majority of sales come from reps who have taken the prospect from start to finish over a long period of time. Activity is the key to start.
Of all the possible tactics out there – speaking, publishing, seminars, direct mail, PR, internet marketing, the list goes on – cold calling rose to the top as the most effective to generate quality leads, after referrals. So why is there such a big debate around cold calling and whether or not it works for professional services? The short answer is because people are doing it the wrong way. The purpose of a cold call is to set a meeting to introduce yourself, and to learn about the prospect… not to go into a detailed sales pitch. All too often, business developers try to pitch their services over the phone, rather than approaching their targets with a value based offer for the meeting (research, industry insights, best practices, etc.). If you take the respondents’ advice above – “do your research” before the call, offer something of value, keep it conversational, listen, keep good notes, and follow up – then cold calling can and does work (and it may even become your #1 tactic).
Caveat: Have realistic expectations
While cold calling can and does work, you need to have realistic expectations. It is very unlikely that you are going to call someone right at their elusive time of need. Sales cycles for services take 3, 6, 9, 18 months or longer. The introductory meeting is the first step in a series of actions designed to build trust with your prospect over time through lead nurturing (see Insight #5).
Evaluating 33 lead generation tactics and strategies
We looked at two basic measures of 33 tactics and strategies that professional services companies might use to generate leads for new business: • Have you used it? • If so, how effective has it proven in generating leads for your services? Companies rated effectiveness on a scale of 1 to 5: 5 = Extremely Effective, 4 = Very Effective, 3 = Somewhat Effective, 2 = Not Very Effective, 1 = Not At All Effective
The most effective tactics
The chart below illustrates the top 5 most effective tactics as rated by respondents as “extremely effective” and “very effective.”
11
17
13
13
7
41
31
32
25
26
0 25 50 75
Making 'warm' phone calls (to existing contacts) (N = 778)
Speaking at conferences / trade shows (N = 616)
Running our own in-person events (N = 496)
Becoming members of professional /industry organizations (N = 728)
Connecting with press contacts to gainPR about our company (N = 530)
Both in aided and unaided responses, using the telephone to generate leads rises to the top as the most effective tactic (be it through “warm” or “cold” calling). Several of the respondents chimed in to share how they combine this strategy with other tactics to warm up their prospects before picking up the phone. Calling Combination Strategies – Selected Commentary
Comment From With Conference Sponsorship: Appointment-setting services: calling attendees of focused conferences for which we are a major sponsor, we speak, and we have clients speaking. We know it works because of the number of 'new logo' clients we have obtained through this process. Timeliness of the calling after the event is key.
VP / Director of Business Development, Marketing / PR / Advertising
With Direct Mail: Cold Calling via phone preceded by letter.
Principal / Partner, Procurement & Telecommunica-tions
With E-Mail: We call then send target-appropriate, industry-specific articles via email. We get emails back saying great articles etc.
CEO / President, Architecture / Engineering / Construction Services
With E-Mail: E-mail sent out followed by call. It brings in leads. Individual e-mails speaking to the target, not just the target group. Dovetailed communication.
VP / Director of Business Development, Marketing / PR / Advertising
With Direct Mail & Follow-Up Calls: Contacting potential clients via telephone and talking with them about our service. Then we send a targeted brochure, and then we call them to set up a meeting. This has been very successful in the markets we have tried it in. The key is follow up!
Principal / Partner, Architecture / Engineering / Construction Services
Getting through to high-level decision makers, getting your message of value seared into their heads, and getting them over the tipping point of becoming a serious lead for your services takes multiple touches, time, and marketing savvy. There is no silver bullet tactic. While we see that “using the telephone” to generate leads rises to the top of tactics, it is that much more effective when combined with other tactics. For example, assume you have been chosen to speak at an industry conference (the number two most effective tactic cited). You pour your time and effort into securing the speaking engagement, creating the PowerPoint deck, practicing your speech, preparing materials, etc. You show up, deliver, and pass out packets with a shiny new company brochure and your business card. You go back to your office and wait for the phone to ring. A certain number of the attendees will be so interested in your presentation that they will pick up the phone and proactively begin a discussion with you. But the majority will go back to their office and your nice brochure will get buried in a pile on their desk. Now, consider how much more effective your speaking could be if you were to touch the attendees both before and after the event. For example: • Tactic 1: Send a direct mail letter to conference attendees focused on the benefits
of your presentation. • Tactic 2: Call attendees offering to meet with them during the conference to
discuss how this new research affects their firm and their challenges. • Tactic 3: Speak at the conference, network, and position yourself as a resource. • Tactic 4: Add everyone you met to your Contact Management System (and your
touch plan – see Insight #5). • Tactic 5: Follow up with an email including the slides from your presentation. • Tactic 6: Follow up with a phone call to discuss how this data relates to your
prospects’ firms and to answer any lingering questions they may have. In this case, combining lead generation tactics generates a fair share of leads both before and after the speaking engagement.
Caveat: Don’t evaluate lead generation too quickly
Lead generation is a multi-step process. It takes ongoing touches to draw prospects into the “seduction of your services.” These touches need to be well planned, with a consistent message, at the right frequency, with the right mix of offers. This takes time. Many professional services firms plant seeds in hopes of growing a tree, and dig them up after two weeks to see if they're growing. That's not a good way to grow trees.
Many companies let the leads they work so hard to generate drop out of their pipeline.2 In our experience, service businesses are better at staying on sales-ready leads, and notoriously bad at staying on leads that need further nurturing. If your company is one of the many that are poor at staying on leads that are not sales-ready when they present themselves, you are likely missing out on 2/3 of your new business opportunities. This is less a question of lead generation, and more a question of the systems and processes you have in place for lead nurturing. Lead nurturing allows you to stay top of mind with prospects that will eventually look to solve their problems with someone’s help (e.g. your help, a competitor of yours, internal staff), and gets the issues you can help with to the tops of their to-do lists.
Caveat: Provide value in your marketing
Lead nurturing is not calling your targets every 2 weeks to ask them if they are ready to buy your services yet. Lead nurturing is your opportunity to demonstrate the value you can provide and position yourself as a resource. Send 1-to-1 communications using the phone, email, and mail that include a value based offer such as an article that addresses your prospect’s challenge, an invitation to a networking event, seminar, or webinar that might be of interest to them (even better if you are the one speaking at the event), a white paper, etc. Reference: See page 84 in the report to see the effectiveness of various offers as reported by our research respondents.
2 A BtoB Magazine article April 14, 2003 cited an estimate by the Yankee Group that between 40% and 80% of new business leads are lost, not followed up upon, or otherwise mishandled due to poor company processes.
Insight #6: Indicators of the Future of Lead Generation
The future of lead generation
The question remains, what trends in lead generation will take shape in the next several years. Here are 7 topics cited in the report that indicate just where lead generation is going:
Topic See Page Increasing Competition 93 Brand Matters 26 Top “Unaided” Tactics: • Overall • By Industry
54 & 24
Top “Aided” Tactics – Usage and Effectiveness 73 Top “Aided” Offers – Usage and Effectiveness 84 Non Users Seriously Considering Using: • Tactics • Offers
109 114
Answers to the $100k Question 104 For other important indicators of the Future of Lead Generation, see all of the verbatim comments from survey respondents regarding not only their top tactics, but the keys to the effectiveness for those tactics.
Now Available! What’s Working In Lead Generation How To Spend Your Time, Energy, & Money For The Best ROI In B2B Professional Services
In addition to the lead generation insights presented in this summary, the complete report includes:
− Expert commentary and analysis: takes a deep dive into the numbers to help you understand what they mean and how you can use this report to improve your own lead generation efforts
− The best kept secret: lead generation tactics which are highly effective, but which the majority of companies is overlooking
− Industry-by-Industry comparisons: see how your industry differs from the norm, and why
− Verbatim comments: hear what over 700 survey respondents had to say, in their own words, about their top tactic choices and how to make them work
− The $100,000 question: Verbatim responses to the question, “What would you do with an extra $100,000 for your marketing and sales efforts this year?”
− Analysis by firm size: learn which tactics are for you – whether you are an independent or a billion dollar firm
− Ability to generate leads: see where “good” and “excellent” lead generation companies are investing their marketing dollars, versus others
− The future of lead generation: which tactics and offers professional services firms plan to utilize in the next few years
− And more (see table of contents on following pages) Order your copy of What’s Working In Lead Generation:
What’s Working In Lead Generation Table Of Contents INTRODUCTION: 6 Lead Generation Insights For 2007 • How To Use This Report • Insight #1: Brand Matters • Insight #2: Know Your Target Market • Insight #3: Cold Calling Works • Insight #4: Integrate Your Tactics • Insight #5: Nurture the Leads You Have • Insight #6: Indicators of the Future Lead Generation • A Few Key Terms Used In This Study THE LEAD GENERATION ENVIRONMENT IN TODAY’S PROFESSIONAL SERVICES BUSINESS Setting The Stage • Professional Services’ Ability To Generate Leads • Why Being “Well-Known” In Your Target Market Matters • Companies’ Current Approaches To Getting New Business • Sales & Marketing Budgets In Professional Services • Growth in Annual Revenue Over Last Two Years • Geographic Reach of Client Base How Companies Are Going About Lead Generation • Who’s Expected To Generate Leads • Typical Lead Quality • Knowledge Of Target Markets • Lead Generation Challenges Faced By Professional Services BEST LEAD GENERATION TACTICS, STRATEGIES, & OFFERS Top Ways To Generate Quality Leads • Top Strategies For Generating Quality Leads • Referral Building As A Top Tactic: Selected Commentary • Cold Calling As A Top Tactic: Selected Commentary • Hosting, Attending, & Speaking At In-Person Events As A Top Tactic: Selected Commentary • Online Marketing As A Top Tactic: Selected Commentary • Other Top Tactics: Selected Commentary Evaluating Tactics & Strategies • One-By-One Usage And Effectiveness Of Tactics & Strategies • The “Don’t Know Effectiveness” Factor
Evaluating Offers And Their Content • Lead Generation Offers • Types Of Content For Lead Generation Offers TOMORROW’S TRENDS IN LEAD GENERATION 2-Year Prediction: Across The Board Increases In Lead Generation • Changes In Approach To Lead Generation • Reasons For Increasing / Decreasing Lead Generation Efforts Voting With Dollars: The $100,000 Question • Where To Invest In Marketing & Sales • Selected Verbatim Comments About Use Of $100,000 Trends For Future Use Of Tactics, Strategies, Offers, & Their Content ANALYSIS SECTIONS BY FIRM DEMOGRAPHICS Analysis By Industry • Overview • Accounting, Tax, Payroll, Bookkeeping Services • Architecture, Engineering, Construction Services • Financial, Insurance, Real Estate Services • Human Resources & Organizational Development Consulting • Information Technology Consulting & Services • Law Firms / Legal Services • Management Consulting • Marketing, Public Relations, & Advertising • Training, Executive Education, & Coaching Services • Other Consulting / Professional Services Analysis By Firm Size BACKGROUND & PARTICIPANT DEMOGRAPHICS • Background & Participant Demographics • Survey Methodology • About The Participant Firms • List Of Participating Companies ABOUT RAINTODAY.COM & THE REPORT AUTHORS • About RainToday.com • About The RainToday Research Team
