Sunday, November 13, 2005

Leads Suck

Tying marketing activities to leads and sales is all the rage these days. Marketing and PR departments are increasingly being asked to prove their value, especially as the fees for a decent PR firm can eclipse $15k per month. Invariably, the answer is that PR, advertising, marketing, etc. all generate leads.

Well, my friends; as a guy who’s been around the block a time or two in sales, I can tell you that leads suck.

Leads are expensive. Either you are paying $100k+ per year for a PR firm, or investing over $20k for a trade show appearance, or six-figures on advertising – whichever course you take, your company is spending very good money on ‘leads.’

And since your company is spending so much money finding these leads, the pressure is on the sales force to make them pay.

99 times out of 100 (literally), leads are DOA.

The problem with leads is not just that they suck, but the opportunity cost that they are associated with. In almost any sales and marketing organization, the onus is on sales to make something out of a lead (once the lead comes in, it is immediately flipped to sales – right?).

It is mind-boggling that sales departments allow their outside sales professionals –often making a six-figure base- to waste time qualifying tradeshow leads, in-bound inquiries, or meetings from a telemarketing firm…but it happens all the time, and ultimately, that high-paid sales force becomes so disenchanted (usually after the 166th B.S. lead from that trade show) that they give up, only to find that the business they should have been chasing has been neglected.

If a good sales professional is spending his time qualifying leads, the company is facing an opportunity cost equal to double his current forecast.

Leads come in from marketing-related activities – great. But the job does not end there. Marketing needs to find a way to ask the right questions – budget, timeframe, need, competition and economic buyer- and then and only then get sales engaged.

A lot of companies talk about quantifying their value, but who is really running the ball into the proverbial red zone?

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