This is the third segment of a three-part series on thought leadership, titled, "3 Painful Lessons Early Adopters of Marketing Technology Learned That You Can Avoid," by Dan McDade, President and CEO of PointClear, LLC. Read part one here, and part two here.
If companies ran marketing and sales the way manufacturers and distributors run their supply chain, they would see substantially higher revenue at significantly lower cost.
Manufacturers and distributors are focused on LEAN — where every step in their processes must add value for the customer. It is no coincidence that recent issues of Industrial Distribution include multiple articles about“automating for efficiency,” “your strategy for speed,” and “improving accuracy in the supply chain.”
However, when it comes to marketing technology, manufacturers and distributors are falling into the same traps technology companies, as an example, fell into years ago — and for the most part still have not climbed out of.
This three-part series will help distributors learn from the mistakes of early adopters of Marketing Automation, Big Data Analytics and CRM.
Here in Part Three, the topic is CRM. We’ll discuss how you can increase return on marketing investments by 300 percent using segmentation, nurturing and closed loop processes:
I’d like to propose that the most underutilized marketing activities are:
- Identifying pipeline
- Mining value from long-term prospects and unresponsive prospects
Consider the following:
- 5 percent result in highly qualified sales leads = 5 leads
- 5 percent will be what I call “pipeline” dispositions. (These are dispositions that require another step within a month or six weeks prior to potentially qualifying as leads.) Such “pipeline” dispositions can increase marketing results by 40 percent if properly nurtured.
- 20 percent of 5 “pipeline” dispositions = 1 lead in addition to the existing 5 leads.
- Another 27 percent will be what I call “nurture” dispositions. (These dispositions are qualified contacts in qualified companies with circumstances — technical or other — that make them a good fit over the next two sales cycles.) When properly nurtured, the lead rate on these “nurture” dispositions is approximately 26 percent.
- 26 percent of 27 “nurture” dispositions = 7 leads in addition to the 6 leads already generated.
- Another 35 percent will be what I call “unresponsive” dispositions. (Because unqualified accounts have now been taken out of the mix, these suspects will close at 150 percent of the initial lead rate of 5 percent for a total of 7.5 percent or almost 3 leads.)
The result? 15+ leads as opposed to 5 leads – over 300 percent improvement!
I have a client who started at his company with no pipeline and grew it to over $200 million within a two year period. When I asked how he did it, he revealed his secret: relentless focus on the 1,200 companies he knew his company should be doing business with — or should be doing more business with.
Ignore the Experts
Back to the lead generation experts. While some have started to talk about the value of nurturing, for the most part their perspectives are based on theory, not experience. You don’t hear many experts today sounding the alarm about inbounditis and the importance of minding the GAP with proactive outbound tactics.
Former “chief evangelist” of Apple, Guy Kawaski, worked with a man by the name of Steve Jobs. You may have heard him. Read what Kawaski has to say about the number one (out of 12) lessons he learned from Jobs:
"Experts — journalists, analysts, consultants, bankers, and gurus can’t ‘do’ so they ‘advise.’ They can tell you what is wrong with your product, but they cannot make a great one. They can tell you how to sell something, but they cannot sell it themselves. They can tell you how to create great teams, but they only manage a secretary. For example, the experts told us that the two biggest shortcomings of Macintosh in the mid-1980s was the lack of a daisy-wheel printer driver and Lotus 1-2-3; another advice gem from the experts was to buy Compaq. Hear what experts say, but don’t always listen to them."
My advice? Listen to Guy. Ignore the experts. Learn from others’ mistakes. Stay LEAN!
For more on this topic, download “Mind the Gap.”
Dan McDade is President and CEO of PointClear, LLC, a prospect development firm that helps B2B companies drive revenue by nurturing leads, engaging contacts and developing prospects until they’re ready to engage with sales. The Sales Lead Management Association named McDade one of the 50 most influential people in sales lead management for the last five consecutive years. His book, The Truth About Leads, is a practical, easy-to-read guide that helps B2B companies focus their lead-generation efforts, align their sales and marketing organizations, and drive revenue. Read McDade’s blog (ViewPoint l The Truth About Lead Generation) or contact him by email at firstname.lastname@example.org. Follow him at @dandade on Twitter.