It starts when someone first raises their hand, saying, "OK, I'm interested in your offer. Tell me more." If all goes well, it ends with a sale and a satisfied new customer. In many companies, however, leads that don't produce quick results end up in the "dead leads" file.
Lead management is the process of turning leads to customers. Virtually every company has some form of lead management process. Few do it well, though, and many admit they are muddling along, waiting for an all-inclusive CRM solution, hoping that it will manage sales opportunities for them.
This approach poses two problems:
- It defers the hard work of thinking about lead management until IT starts implementing an all-inclusive solution. This, in turn, means that a solution is less likely to result in processes that have been thoughtfully re-engineered, fully incorporating the best insights from top sales and marketing staff.
- It discourages consideration of tactical fixes that could be delivering incremental improvements and learnings well before the arrival of a full CRM-based solution.
In my experience, there are almost always solid opportunities to improve the way prospects are managed. Often the involve changes that are affordable and easy to implement without waiting for a full CRM system.
Three of the most common opportunities:
- Program planning for non-converters: A typical lead-generation program produces 20 leads for each final sale. In most companies, program planning is focused on managing leads through to a final sale. Often when we ask, "What do you do with those who raised their hand but never purchased?" the answer is either "Nothing" or "We follow up when we can."
Common sense suggests that many of those who inquire are not ready to purchase within the timeframe of a particular marketing campaign. Recent research suggests that over half of all prospects take more than a year to purchase and that nearly 70% of non-buyers, when contacted 6 months after their initial inquiry, will say they are still in the market and still planning to buy.
Non-buyer recontact programs are one of the most-effective ways to improve the productivity of lead management efforts.
- Enhancing sales process for lead cultivation: In her book, "The Green Banana Papers", Chris Coleman uses the banana harvesting as a metaphor for marketing the task of marketing is to harvest bananas, 95% if which are green. Sales focuses on the 5% that are ripe. Non-converter programs succeed because, simply through the passage of time, some bananas will ripen. Several companies have used this insight to build sales teams on the "Hunter-Farmer" model. The Hunter is the traditional sales rep, whose primary concern is to close sales. The Farmer's concern is to cultivate leads until they are ready for closing.
- Retaining data for analysis: Companies typically assume that solicitation lists and program documents should be discarded, that they contain little information value outside the context of a CRM system. On the contrary, the effort to collect and retain such information can generate significant insights about how to improve lead management. Solicitation lists can be aggregated to support performance analyses to determine the optimal frequency and timing of programs. They may also disclose fixable problems created by excessive or uncoordinated messaging.
Companies that retain solicitation history, planning documents and results analyses generally provide much more effective guidance to the selection and implementation of CRM and marketing automation solutions. In one recent case, a client of ours found they could provide marketers three years of campaign history in the first release of their newly installed campaign management system.
- Store all leads
- Maintain all information including contact information, business characteristics, product interest, and communications preference
- Provide lead ranking measures
- Plan and manage communications to move leads through the sales process
- Support testing and measurement of lead management strategies
- Allow marketers to evolve lead management processes
An interim lead management solution is often a very affordable way for marketers to improve performance while awaiting full implementation of an Enterprise CRM System. The incremental learnings and historical data can speed the successful adoption of any new system.
With over 30 years of marketing and systems experience, Richard provides technical services for Draft clients in the United States and Canada. His group provides customized interactive and database solutions, database hosting and operations, customer analysis and modeling, list processing, operations consulting and overall program/vendor management of online and offline direct marketing programs.
Richard has extensive experience using information technology for marketing in financial services, telecommunications, consulting services and manufacturing. In his nine years at Citibank, Richard created a database marketing system that integrates customer information from over thirty different consumer businesses, capturing relationships with one out of every four households in the US. During his four years as CIO of Financial Information, Inc., Richard successfully implemented Customer Relationship Management for the firm by web-enabling the firm's product offerings, marketing programs, and customer support services. Richard joined Draft in 2000.