Lead nurturing helps convert more leads into satisfied customers.
Websites. Trade shows. Direct mail. Marketing campaigns. Leads. If effective, lots of leads. You invest your marketing dollars to expand your audience, generate more interested prospects and turn them into paying customers. Whether leads come in bunches, through a trade show or consistently through online programs, don’t miss out by following up with each one in the same way. You personalize follow-up to customers depending upon their needs. Prospects require the same attention.
Do You Turn Leads Over To Sales Before They Are Ready?
Many years ago, our marketing team executed an ad campaign that generated dozens of leads a week. Each opportunity was nicely packaged and distributed to the appropriate sales team. Before Google Maps and search engines, the reps followed up by phone. If they couldn’t connect, a rep jumped in his or her car and visited the contact’s location. Many times, this trip concluded at an obscure non-business address. Whether the location was the home of a hobbyist or competitor, it wasn’t a selling opportunity. And it didn’t take long to condition the sales team to not waste their time.
Sending all leads to sales, regardless of the lead’s readiness to buy, impacted results. Many a lead campaign was undermined by this misstep. Even today, leads are pushed to sales without scrutiny. Marketing Sherpa found that over 60 percent of leads are sent to sales unqualified.
With contact data available at their fingertips, it’s much easier for your sales team to learn about the prospect and connect. However, they may still consider it a waste of time. Perhaps the prospect isn’t ready to buy or is in the early education process. Regardless, if this happens only a few times, your sales force won’t prioritize the leads you send them. But these “bad leads” often are anything but bad. According to SiriusDecisions, 80 percent of prospects deemed “bad leads” by sales teams go on to buy within 24 months, perhaps from your competitors.
A High Percentage Of Leads Aren’t Ready To Buy Today
The reality is that over 70 percent of the leads you receive aren’t sales ready. Of the leads that are qualified, 50 percent aren’t ready to buy now. That’s why you need lead nurturing.
What Exactly Is Lead Nurturing?
Lead nurturing is the process of developing relationships with buyers at every stage of the sales funnel and through every step of the buyer’s journey. It focuses marketing and communication efforts on listening to the needs of prospects and providing them information and answers.
Nurturing is essentially a journey for your buyers where your company plays the tour guide. You’ll learn more about what buyers like based on their activity and behavior. You’ll provide relevant, timely information based on those preferences. Ultimately, you’ll learn to recognize when buyers are approaching a purchasing decision and begin a conversation with your sales team.
A Nurturing Program Pays For Itself
Effective nurturing programs generate increased revenue—a significant amount of revenue.
- Fifteen to 20 percent of the not-ready-to-purchase leads convert into sales after lead nurturing.
- Nurtured leads make 47-percent larger purchases.
- Nurturing programs are characterized by timely follow-up, and time does matter. Thirty-five to 50 percent of sales go to the vendor that responds first.
Automated lead nurturing programs can further improve performance. Gartner [an information technology research company] reports that automated lead management programs result in a 10-percent or greater increase in revenue in just six to nine months.
Effective Nurturing Targets Unique Buying Stages
Whether online or in person, buyers interact with you at different stages of the buying process. Each phase requires unique communications to assist the prospect through that stage and onto the next one. The communications parallel the steps a sales rep takes with a prospect. Depending upon the prospect’s industry knowledge, product knowledge and needs, that conversation is vastly different.
But today a sales rep may not be involved in initial prospect conversations. Fifty-seven percent of a purchasing decision is made before a buyer contacts a seller. Using online tools in the selling process is more important than ever. Much like an effective sales rep, a successful nurturing program allows prospects to learn about your services, even if they aren’t speaking with you directly.
The Purchasing Phases
The phases a buyer progresses through to ultimately make a purchase are consistent across most industries. Those phases include:
- Consideration — This is the first step in the buying process. The prospect may not understand their exact need or potential solutions. They are researching the industry, broad product applications and capabilities.
- Preference — The prospect starts to research specific brands. They have increased their knowledge and are starting to narrow the field of potential competitors.
- Intent — The customer is nearing a purchase and needs details about the major business benefits of the solution they are exploring.
- Repurchase — The customer experience and ongoing interaction, both in person and electronic, influence future purchases.
What Do Buyers Look For In Each Phase?
The type of information that satisfies the buyer’s need is unique to each phase. Effective content in the right channels will advance prospects down the sales funnel and convert more into paying customers.
- Consideration — Providing broad education about available solutions is the nurturing goal of this step. Blogs, infographics and white papers are excellent vehicles to convey this information.
- Preference — Provide content from your website, specialized landing pages, case studies or white papers that explain the specific product in the context of the benefits that matter most to your audience.
- Intent — Use cases, the ongoing support process and defined implementation plans are helpful in converting your prospect to a customer. It’s helpful to have this information in a white paper format, but it is most often executed through one-to-one emails or face-to-face conversations.
- Repurchase — As you better understand the customer, you can provide information specific to their needs. These communications, both in person and electronically, serve to strengthen your brand and create opportunities for cross-selling and upselling other products.
Targeting your follow-up to the prospect’s purchasing phase will encourage more to climb down the sales funnel to that ultimate purchase.
Which Stage Is Your Customer In?
The most common way to segment prospects is to develop a lead-scoring system. A good lead-scoring system watches for online and offline buying signals, increasing your ability to pass qualified leads to sales. Most importantly, it helps sales focus time and effort on the most likely buyers.
When a prospect interacts with you at a trade show, lands on your website, opens your emails, fills out contact forms or just simply interacts with your content, the prospect is showing an interest in your company or capabilities.
Creating a set of scoring rules allows you to identify your prospect’s buying interest.
A lead-scoring system generally assigns points to contacts based on the attributes that make them a viable prospect including job title, company size, location, industry and more. It also accounts for the actions the prospect has taken or not taken. Each lead accumulates points as they interact with your company. That might mean attending events, opening emails, visiting your website and downloading content.
Although it isn’t difficult to set up lead scoring, it is important to gain consensus on the attributes that represent a good lead. Here are five categories you should consider:
- What is your ideal buyer?
- What are the common characteristics shared by your best customers?
- What types of companies usually buy your product? In which industries?
- Which types of people have the decision-making authority and budget to purchase your product?
- Which attributes does your sales team look at first when they receive a lead, and what profile characteristics make them confident that the lead has potential?
- Assign points to each of the characteristics you’ve identified.
You can use almost any point system. Perhaps the ideal prospect gets 15 points, a good prospect 10, and if it’s just average, five. Whatever you choose, just make sure that the criteria that have more points really do indicate a higher likelihood to buy.
- Identify behaviors that indicate interest.
- What content do potential buyers usually view before making a purchase?
- Which events, videos and other assets are you promoting that might indicate a high likelihood to buy?
- What types of behaviors indicate willingness to engage with sales?
- Assign a point value to each behavior.
Give bigger scores to behaviors that require more time commitment or indicate buying intent.
For example, a form submission requesting a personalized product demo would score higher than a click on an email.
- Put it all together.
Since your prospect’s lead score will be based on their level of interaction with your company, the lead score will be a great indicator of the sales readiness of the lead.
Develop a Process, Even if it’s Only Manual
Nurturing leads is a proven way to increase your business. Whether you adopt a CRM or marketing automation system that helps you organize and streamline the process or opt for a manual system, take the next step and develop a program.
You’ll generate more leads and close more business. Just watch out for the line of reps waiting outside your door.
John Edmundson is the principal of InterEdge Marketing. Reprinted with permission of PS Magazine, PSDA.