Yes, Too Many Leads can Hurt Sales26 Feb, 2008 By: Dan McDade imageSource
Yes, Too Many Leads can Hurt Sales
Hard to imagine this, but here goes. Is it possible to produce too many sales
leads with a direct marketing campaign? Are qualified leads really that
important? The answer to both questions is yes.
You ask yourself, “How can that be when big companies spend millions on
large-scale marketing campaigns that bring in an avalanche of leads?” The answer
is in where all of those leads end up—buried.
That’s because this type of direct marketing campaign is designed
specifically to focus on lead volume. And while there are undoubtedly some good
prospects in the load, the true sales opportunities are mixed in with a ton of
low-quality names that really are not leads at all. It’s a bit like looking for
a needle in a very large haystack, which is not how sales reps working on
commission like to find their leads.
When sales reps are actually presented with a smaller number of highly
qualified sales opportunities (instead of a stack of low-quality “leads”),
they’re able to better focus their efforts and give high-value prospects
priority attention. Culling fewer but better leads can lead to higher sales.
One problem has been, however, that frequently little if any lead management
is integrated into a direct marketing campaign. Volumes of names are passed
directly through to the sales rep, without qualification or prioritization.
Practicing lead quality over quantity is more difficult than it sounds,
however, because a traditional direct marketing campaign is typically measured
based on the volume of sales leads it generates, not on lead quality. In
contrast, sales success is measured based on the number qualified leads
converted into revenue.
See the gap? This reveals why in most firms today, there’s a huge
misalignment between sales & marketing. It’s also why a direct marketing
campaign that is initially deemed a success based on the number of leads it
brings in, can end up generating much less revenue.
Let’s Define Qualified Leads
So what are qualified leads made of? The best normally have 10 of the following
attributes. Unqualified leads rarely have more than three:
● SIC or NAICS code
● Firmographics (revenue, number of employees,
number of locations)
● Decision-makers and influencers identified
● Environment documented
● Decision-maker engaged
● Business pains uncovered
● Decision-making process and timeframe documented
● Budget allocated or process for budgeting
● Competitive landscape documented
● Awareness of sense of urgency or existence of
Qualifying your prospects with these data delivers benefits beyond simply
enabling sales reps to identify the most likely sales candidates. For instance,
by having a detailed picture of the prospect’s business drivers, plans, and
buying processes, the sales rep is positioned as a knowledgeable adviser
interested in the prospect’s business challenges. As part of the qualification
process, the prospect has also been “warmed up” to the proffered solution before
the actual meeting with the sales rep ever takes place, eliminating the dreaded
cold calls and providing better results than can be obtained from a generic
direct marketing campaign.
Dan McDade is the founder/president of PointClear, a business prospect
outsourcing company based in Norcross, GA.