The Edge Marketing

The basic lead generation process is pretty much the same from company to company. Inquiries come in…they’re qualified…and then sent to the sales team. Some turn into customers. Some don’t.

Which means that, over time, every organization ends up with a pile of prospects that either disengaged during the sales cycle (for whatever reason)…or decided to go with a competitor.

So here’s the big question: is anyone in your company following up with these potential future opportunities?

I can tell you that very few companies I’ve worked with have systems in place to nurture these longer-term prospects. Yet, the potential for increased sales is significant, and can be very cost-effective.

Here’s one reason these prospects don’t get much attention: good salespeople tend to spend most of their time on higher-probability opportunities with the best chance of closing the quickest. And who can blame them? Reps are under constant pressure to close business and meet quotas. That means there’s little time for lower-probability prospects.

But that doesn’t mean you should throw these leads away. There can be tremendous long-term value in these opportunities…if you can set up a system that allows you to follow up on them consistently—and without breaking the bank.

I call this strategy “lead recycling” because, in essence, that’s exactly what you’re doing—you’re “recycling” these longer-term prospects back through a targeted lead generation process.

The payoff? I’ve seen this strategy boost sales by 5% (even 10% or more) over the course of a year—all from qualified prospects that would have normally been ignored!

In fact, one of my software clients recently tested a new “lead recycling program” as part of an effort to grow sales to record levels. As a result of this new initiative, they were able to increase sales of one of their solutions by 13% over the course of a year!

This company was generating an average of 600 inquiries per year for one of their products. From that point:

* Some 450 of those 600 inquiries turned into appointments

* Nearly 90 of those 450 appointments eventually turned into sales (over the course of a year)

This was good enough to meet budgets. But it also meant that over 500 “inquirers” were NOT buying from them every year!

They knew it wasn’t practical to expect sales to follow up on every one of these “lost” opportunities. So they implemented a system that funneled these longer-term prospects back to marketing, using a combination of email and direct mail.

The results were outstanding. Over the course of a year they were able to close an additional 12 new opportunities just from this list—a lift in sales of over 13%!

So here’s why this strategy works so well: When it comes to prospects you’ve engaged with in the past, you’ve probably done most of the heavy lifting already. You’ve done the hard work of getting them to respond to a campaign. You may even have established a certain degree or rapport and trust with many of them. And you’ve educated them on your offerings and how they can solve their business problems.

Therefore, when a prospect disengages because of “bad timing” or “budget constraints” or other reasons, if you don’t stay in touch with this growing list, you risk losing them to a competitor—someone who will greatly benefit from the time and effort you spent educating these folks.

Thinking about implementing a lead-recycling program? Here are some key items to keep in mind:

1. Get “buy-in” from sales. That may not be easy at first, but explain that you’re trying to make their jobs easier. By setting up this program, you’re taking away the burden of following up with lower-ranked leads. This gives them more time to focus on higher-probability opportunities. And best of all, you’ll be able to deliver them a handful of well-nurtured leads every year.

2. Consider qualifying more thoroughly up front. This places a bigger burden on marketing. But in the long run, everyone wins. Leads that are simply inquiring at this point and are months away from seriously evaluating options should all go straight into this nurturing program. They’re just not ready to be turned over.

3. Set up systems that allow sales to easily forward prospects that need to be recycled. They should include “lost” opportunities, delayed decisions, and warm leads that have turned cold.

4. Lastly, “seed” this prospect list with a steady stream of value-added communications. Consider launching an e-newsletter in order to gather more opt-in email addresses. Also, try direct mail targeted at specific groups within this list. And as long as each of these communications has an appealing call to action (demo/presentation CD, white paper, an invitation to a Webinar, and so on), you continually increase your chances of creating top-of-mind awareness with these prospects.

Bottom line: These days, it takes tremendous effort to generate qualified leads. Don’t let any of them fall through the cracks. By setting up a “lead recycling program” you optimize your efforts and help generate sales that would have never closed otherwise.

© Copyright 2004, Ed Gandia. All Rights Reserved.

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