B2B marketers & The digital camera

Think about what the digital camera has done to the average picture taker. In the "old days" of film you had to be selective on the pictures you took as film was expensive and you only had 24-36 pictures at your disposal (unless you were carrying extra rolls of film). Once the roll was done you had the roll developed and hoped for around 70% quality photos. As the years went by you slowly became a better and better picture taker, learning through trial and error what environmental factors drove the quality of your photos. Even without the ability to instantly receive feedback on the picture quality your average quality photo percentage grew to around 90% per roll. As a picture taker, you were forced by the limitations of your technology to become better if you wanted to increase quality, reduce cost, and avoid the opportunity cost of not capturing those "one in a lifetime" moments.

Then came the digital camera and all its benefits!?!
Much to Kodak and Fuji's dismay the digital camera was a revolution not an evolution. Almost overnight the digital camera brought immense benefits that film was no match for. Loaded with a 2GB memory card, a digital camera can hold 180 pictures at "no cost." In addition, the photographer (I use that term loosely) can review the photos instantly for quality and immediate feedback. This technology enabled and afforded the average picture taker the ability to snap as many pictures per minute as a professional sports photographer sponsored by Kodak. In addition, the digital camera user gained the benefit of instant feedback on the quality of their pictures. By reviewing photo's as they were taken the picture taker could, in theory, accelerate their photography learning curve. The digital camera was going to enable "average joe" to capture images like a Pro!

The Problem
The problem is that most digital camera owners are "trigger" happy, quickly filling their memory cards with 180 images hoping that a few of the pictures will turn out. Sadly, the average digital camera owner never learns anything about taking a better picture. Because pictures are "free" to take the camera owner keeps pushing the button hoping for "one good picture." Further more, even though the capability and technology exists on the camera, the average photographer rarely reviews and filters the photos for quality before dumping them on the home hard drive. It is only when the masses of snap happy and skill deprived picture takers want to do something with their pictures a few months or few years later that they learn what a mess they have created. 3-hours into cleaning up bad photos and realizing the images they hoped they had captured do not exist do they learn what the cost of not becoming a more skilled photographer truly is.


B2B marketing technology advances are accelerants not replacements
Unfortunately many of today's B2B marketers exhibit very similar behaviors to the average digital camera owner.

• The cost of gathering unqualified inquiries and contacts through list sources and database providers has dropped substantially over the last 5-10 years, not unlike the cost of taking a picture. As a result, many marketers have become less concerned with precise targeting, qualifying, and filtering and more driven by the quantity of inquiries they can generate.
• A majority of B2B marketers do not filter, cleanse, and pre-qualify the inquiries and contacts they have captured before loading them into their marketing database, SFA, CRM system. Unfortunately, unlike the average digital camera owner, who's only expense is time to filter through their gigabytes of bad photo's, the B2B marketer creates significant expense and opportunity cost for their organization.
• For many, the low cost and automated inquiry capture tools available to the B2B marketer have become an easy "solution" rather than an enabler to enhance the lead lifecycle management processes and lead generation programs already in place.
  

While it shows my age that I have a decade or more of film based photography under my belt I am glad for the experience. Without the cost and quality drivers of a film based camera I may not have become the photographer I am today. And yes, the digital camera has enabled me to become even better.


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How do I leverage sales lead Rank & Score?

You scored 100 three times in a row!

So, what exactly does that mean? Well, if the three scores represented golf, bowling, and an IQ test it would mean you are POTENTIALLY one of the following:

1. Of almost average intelligence and not very coordinated or physically talented
2. Of almost average intelligence, a 7 handicap golfer who played a US Open course from the back tees on a windy day, and a first time bowler
   
3. A poor IQ tester and a beginner at golf and bowling
4. A relatively gifted 5-year old or 100-year old

The point being, a score, even when put in context of an "event" or combination of "events" does not provide the insight and actionable information required to make decisions or predict future behavior and outcomes. In the above scenario the individual who scored 100 three times could range in age from 5-100, could be a pro athlete or uncoordinated couch potato, and may have any number of careers that range along the intellectual spectrum.

So, How do we effectively leverage Rank & Score in Marketing?

The first step is to avoid (3) major pitfalls when attempting to migrate through the marketing rank and score lifecycle. That is, moving from rank & score program infancy to a program delivering invaluable information and insight:

1. Rushing into Rank & Score because the new system supports it before doing the hard work: What are the goals within the scope of our Rank and Score program? What rank and score criteria is to be used? What are the activity, demographic, and firmographic "values"? How will we capture, measure, compare, and report the information? How do we ensure consistency of process, measurement, and execution across all customer and prospect engagement points (inside, across, and outside our automated systems)?
2. Incomplete Rank & Score measurements: At a minimum the approach needs to include demographic and firmographic attributes along with behavior/interactions. In the opening scenario think of the refinement offered if we had insight to the age and profession of the individual as an example. An incomplete rank and score measurement approach quickly becomes a never ending fountain of unusable information dressed in a pretty wrapper!
   
3. Lack of consistency and measurement standards: Think again to our example above. Even without the firmographic and demographic information on the individual a history of scores based on consistent measurement (same golf course, Test type) would provide a wealth of information on which to predict future behavior and outcomes. However, if you take away the consistency related to the measurement and scoring methodology all you are left with is a lot of uncorrelated historical data and no actionable information.
   

So what is someone to do? To simplify the getting started process there are several keys or "triggers" I would suggest we focus on. While this is by no means and exhaustive list it will help to ensure some of the biggest pitfalls are avoided.

• Rank and Score definitions are clear: Ensure the marketing & sales teams are educated
• Scoring methodologies are locked: Weighting can be modified (with a disciplined process)
  
• The big (3): Demographic, firmographic, and activity based scoring
• Patience: Time & Trend drive ever improving insight, don't jump to conclusions
• Study: patterns and resulting performance for the greatest return
• Compare: Internal patterns & performance to industry benchmarks

Rank and Score is not something you "turn on"
The intent of this post is not to scare anyone away from traveling down the path of a lead lifecycle management rank and score implementation. On the contrary, I hope it drives one or two people to become evangelists and also protectors of the rank and score process within their organization. However, this post is most definitely a warning to anyone out their who wants to "turn on" the rank and score capabilities of their lead management software solution. Rank & Score is a core lead management process, not a switch to flicked!


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B2B Lead Management; Why buy a Ferrari if you live on a dirt road?

Why buy a Ferrari if you live on a dirt road?

If your dream home is 5 miles from the nearest paved road what would the true cost be to purchase and get "value" from a Ferrari? Well, if getting "value" from a Ferrari is taking advantage of the handling, acceleration, and appearance offered the rough up front cost for the Ferrari would be as follows:

• Ferrari = $250,000
• 5 miles of pavement = $4,000,000

After you have made the up-front investment your maintenance costs per year would then kick in:

• Ferrari = $12,500 per year
  
• 5 miles pavement = $100,000 per year

The point being:

1. No one with 5-miles of dirt road outside their garage would consider buying the Ferrari without first considering the cost and time associated with building the road.
   
2. The cost of the Ferrari pales in comparison to the cost of the infrastructure (road) that will enable you to take advantage of what the Ferrari has to offer.
3. Ongoing maintenance of both the Ferarri and the road need to be considered
   

While the above scenario is admittedly absurd I would argue that this very scenario presents itself each and every week in sales and marketing organizations around the world and most organizations either do not consider, or ignore, the fact they have "roadwork" to do! That is, organizations budget for and then spend significant amounts of money on the latest CRM, SFA, and lead automation solutions (read Ferrari) without taking into account the processes, infrastructure, and people (read road) that are needed to take advantage of the the new CRM, SFA, or Lead automation solutions potential performance capabilities.

In my experience I believe there are (3) primary drivers for why this seemingly inexplicable behavior continues to repeat itself over and over again within marketing and sales organizations.

1. "Roads" (lead lifecycle management processes, staff, discipline, and infrastructure) are more work and cost more in terms of time, money, and labor to build/maintain. In addition, after all the hard work to succesfully build the "Roads" they are not very easy to "show off." The "Roads" do not actually do anything or deliver anything they make the doing and delivering more efficient, faster, and consistent.
2. "Ferrari's" (CRM, SFA, Lead automation solutions) have enormous marketing budgets behind them driving brand, market demand, and interest. As the saying goes, there is not an easier person to sell to than a sales person and no one easier to market to than a marketer! "Roads," on the other hand, are not "feature" rich web enabled tools built to support flashy sales presentations.
   
3. Lack of time & "Budget": The Average CMO tenure is still well under 2-years. In 18-months he/she can pull together an ROI and implement a CRM,SFA, or lead automation system in hopes of demonstrating their value to the executive team. There is little chance the CMO can fully evaluate the current condition of their "infrastructure," make the significant investment (multiple's of the Ferrari), and deliver measurable ROI in less than 18 months. To be fair to the CMO, most have their hands tied by head count limitations and ill conceived budget constraints that make doing the right thing, fixing infrastructure, all but impossible.

Regardless of the initial quality and performance characteristics of any software application or piece of equipment without the implementation of supporting processes & execution of a proper maintenance plan performance and reliability will consistently deteriorate over time. While the previous statement is not a epiphany to be sure, most of the marketing and sales lead management systems that are implemented today seem to ignore this simple fact. The end result is that many marketing and sales leaders are left spinning their wheels in the dirt wondering why their high performance, feature rich, systems are not delivering as promised!

Closing the lead lifecylce loop through measurement & Reporting; Final Part in a Dick Lee Series

Tracking, measurement & feedback: Here’s where we meet the end of the lead management cycle—and the beginning. The data we capture from the sales-follow-up process, and from prior lead management steps as well, not only tell us how we’re doing outcomes-wise—but should tell us how to do it better.

However, all too often companies barely attempt to apply back-end data to drive continuous improvement of sales lead management processes and performance. Why? Typically for several reasons: lack of analytical and interpretive skills; lack of time to “get analytical” and do something about the findings; or lack of training skills and resources; or some combination of these factors.

Back-end lead management data are used more often to “punish” than to improve

Sales follow-up data are commonly used for beating up on underperforming reps— when a closer look at these data would indicate why someone is underperforming and whether specific training and reinforcement focused on specific steps in the selling cycle would help improve performance. After all, despite common perceptions, not every sales failing stems from too much golf. And considering that the pool of sales talent is continuing to shrink towards perilously low levels, salvaging your investment in currently underperforming reps is typically more cost-effective than swapping out “bad” reps for new ones—who might just turn out to be worse. Other tendencies to sell short the value of “beneath the surface” data abound, but here are several examples of companies drilling down and doing things right.

A B2B financial services firm was seeing widely disparate sales follow-up:

So this FI examined data tracking the steps to the sale. As it turned out, its more successful reps were managing to get past the initial point of contact to present to the purchase decision team, while its less successful reps pitched the initial contact only and relied on that person to “carry the message” back to the team. Training, focused on communicating the value to the gatekeeper and gaining the buy-in from the gatekeeper to let the reps through to decision-makers. Measured results showed this resulted in making a significant percentage of low performers significantly more productive.

For another example, a business software company was aggressively generating sales inquiries through a range of publications—from highly vertical, low circulation trade pubs to higher circulation, more horizontal business magazines. The CPI (cost-per-inquiry) was significantly lower with horizontal pubs, with the more vertical trades showing a much higher CPI. But this organization didn’t jump to first obvious conclusions. It “closed the loop” by tracking sales follow-up outcomes and measuring CPO (cost-per-order) for all media sources. And guess what? The CPO rankings were the inverse of the CPI rankings. That sent a clear message that lead generation should focus on verticals unless (or until) they were getting tapped out, which marketing would know when CPO ratios started vectoring sharply upwards. Hey, wish you could have heard how the horizontal media reps howled when their below average CPIs didn’t lead to further placements.

Parenthetically, you might want to view this as a “dated” example. After all, isn’t the web now the primary method of generating B2B inquiries? Not exactly. This company’s software product was creating a new product category, and the reactive web is a relatively ineffective and unreliable channel for introducing new product categories. Customers don’t often google products or categories they don’t know exist.

For an excellent web-based example, just think Amazon.com. Buy once, and they already know something about you. Buy twice and they know four times as much about you. Buy three times, and they know 16 times as much. And on up the exponential ladder. On the pure B2B side, Cisco’s not too shabby either.

Putting the pieces together:

If I could ask you to stop reading and reflect for a moment, how would you rate the impact on sales performance resulting from effectively implementing all aspects of sales lead management? Hard not to say “Very high” or even “extreme,” isn’t it? Or, to put it another way, how would you size up the opportunity cost of not applying lead management to sales lead generating marketing programs. The very same answers, of course, but in the opposite direction. Regardless of which way you prefer to view this picture, either the return on lead management or the opportunity cost of not providing lead management dwarfs the cost of providing effective lead management services—either internally or through a third-party service.

Lead Distribution; doesn't matter how much water comes out of the hose if it isn't pointed at the fire! Part V: Dick Lee Series

Lead distribution: Sounds as easy as rolling off a log. And when the time comes to set up sales lead distribution, many companies do literally “roll off a log,” getting in over their head because they don’t think ahead. “What can be so hard about forwarding a few sales leads,” you ask? The very same issue that trips up so many inquiry generating initiatives—where the heck do you send stuff? Only this time, the answer—or better said, the way to find the answer—is quite different.

Here’s an example of what’s so hard. Sales rep A covers two states plus a part of a third—the part north of Interstate 94, which inconveniently bisects several large cities. Meanwhile, Sales rep B covers the south side of I-94, down to I-90, which bisects even more major city markets. How the hell does corporate marketing or a third-party lead management service—never mind its computers—know what’s north of I-94 and what’s south, and what’s north of I-90 and what’s south? And things get really grisly when sales territories split on state or county highways or even city streets.

Then, we have companies that set sales territories by county, rather than zip code. You always get the zip code back with a response, but how often do you capture the county?
There is an “obvious” solution. But like so many “obvious” solutions, it doesn’t work, at least not very well. That’s forwarding leads to a regional office and letting field managers figure out their own distribution. But running leads through an extra pair of hands is a great way to lose them, or delay them—and even more importantly, not computer-assigning leads after they’re qualified makes a mess out of tracking and drastically lowers rep-level accountability.
Oh, and not to forget, what happens when a lead from a prized national account covered exclusively by national account reps gets thrown into the response mix, as often happens? Nothing good if you haven’t prepared for this contingency. And this problem gets compounded when these respondents use variants on formal company names that slip through the lead management software’s record matching function, if the software even has such a function. Try record matching in Excel or Access, will you? A classic example of company names that defy uniformity is the many divisions of 3M Company, most of which are known internally by acronyms or abbreviations.

Like rolling of a log? Yeah, like rolling off a real log in deep, rushing water when you can’t swim.
Because the problems surrounding lead distribution are so varied, I’m going to use a “collage” example of real-world solutions rather than citing a single company’s approach.

The best solution for assigning leads geographically (as opposed to the first obvious solution) is for lead-generating B2B companies to get a grip on the reality. Hey folks, we’re in the age of automation. If computers can’t accurately assign leads to sales territories, redo your territories instead of thrusting your heads into the sand. And if SCFs (three-digit zip code prefixes) or even five-digit zip codes aren’t precise enough, drill down to nine-digits using software expressly designed for this purpose.
The problem is eased for companies assigning sales territories by county, because you can purchase software that affixes counties to street
addresses. But that’s a lot messier than using three- or five-digit zip codes that require no special software.

I will issue one caveat to the above. If you’re selling through third-party reps, distributing leads to distributor or rep company offices may be the only lead distribution route open. However, if you have to go this route, your partner agreements should spell out accountability for partner companies to follow up all qualified leads and report back outcomes.

Unfortunately, properly distributing leads from national accounts and related “special assignment” customers takes more work—but doing this work up front has distinct advantages over a commission-hungry rep going into a national account unaware of special discounts; losing the business by over-quoting; and then ruffling national account customer feathers because the seller is violating pricing agreements.

So here’s the drill. To resolve this issue, inquiry generating companies with successful lead management programs:

• Build company name matching tables including all known variants and abbreviations
• Use record matching software with “fuzzy logic” that matches against multiple data fields and even uses phonetics (“sounds like”) functionality to suggest possible matches
• Preferably do both. These techniques still fall short of being 100% bullet-proof. But not by much.

A case for lead management - Dick Lee (#2 inseries)

Inquiry generation:

In the BW (before the web) years, a major industry conversation went on over whether the “mail-phone-mail” method of generating inquiries was more or less effective than “phone-mail-phone” and whether either variant was better or worse than injecting field sales at an earlier point. After all the scrapping, the answer was a definitive, “It depends.” But today, in the AW years, the Internet has completely changed the dialogue. Either we’re driving traffic to the web; or relying on search engines to get prospects there; or e-mailing customers where we’d used snail mail; or even—and hang your head in shame if this shoe fits—prospecting over the web via e-mail. Otherwise called, “SPAMMING.”

But you wouldn’t do a thing like that, would you? I guess some would. It’s always amazed me how many marketers cling to what meager returns approaches like spamming generate without ever once considering how much damage they do—as if the major damage doesn’t offset the minimal returns.

It’s all too easy to overwhelm even opt-in customers and prospects with promotional e-mail
I’ve recently read data saying that over 70% of current e-mail traffic is spam—and this percentage will increase to 90% plus in the near-term. So who has time to read this crap? And how does so much clutter affect the inquiry-generating value of spamming? Good thing e-mail messaging is free, ‘cause if there was the slightest per-message charge from ISPs for sending e-mail across the Internet, spam, including B2B inquiry generating spam, would shrink right back into the can.

Hey, if you’re after suckers, spam them. Go ahead. But if you’re generating high dollar potential B2B inquiries, stay the hell away from e-mail except for targeting “opt-in” prospects—and you have to be very careful not to pester opt-in folks with promotional messages, or they’ll immediately add you to their “blocked senders” list. You even have to be careful not to overdo it with informational messages, or they too will wind up on the digital dung heap. This is where most "automated" lead nurturing & lead management packages bite the dust. They sound great up front but automated marketing can be automatically filtered out very easily on the receiving end!

So I’m not going to relate a spam success story—not to mention I’d have a hard time finding one. Instead, we’re going to turn to trusty “old” direct mail for our case.

SUCCESS PROFILE:
A global maker of adhesive materials had been trying unsuccessfully to introduce a new materials category into the automotive assembly process. But these materials were nowhere to be found on any carmaker’s “approved materials” list, thereby thwarting all marketing and sales efforts to date. So the marketing and sales folks had to uncover a new “path to market.”
How did they start? Not by ginning up a lead-generating program right off the bat. Instead, using sales’ knowledge of customers and how the car biz runs, they evaluated each car maker’s purchasing process to find out which might prove least resistant to introducing new materials not on the “approved” list for the assembly process. And lo and behold, they found a candidate—better yet, one of the big three (we used to call them the Big Three before they bumbled their way into lower case status).

Marketing and sales continued developing their inquiry generating strategy by carefully identifying and analyzing: which job categories would be most likely to recommend new adhesive products for assembly; which job categories would make final decisions; plus what the decision-making process would look like. And they also took the critical steps of identifying what personally motivated people at each level and “what hurt,” especially at the recommender level. Knowing what frustrated these potential new product recommenders, who turned out to be mostly low-level engineers, provided the basis for the core marketing message and offer.

Based on this detailed analysis, marketing and sales settled on a mail-phone-direct sales sequence to generate inquiries from these junior engineers. The mailing package offered the opportunity to obtain free technical consultation from one of the seller’s senior engineers—a level of expertise car-makers’ junior engineers rarely even pass in the hallway. The proposed consultations focused on specific applications of the new materials at assembly points where these junior engineers knew they were specifying less-than-ideal stuff, but were constrained by the approved materials list. No better B2B offer—now, in the future or in the past—than providing information to help a prospective customer solve a recognized problem.

The mail drop, staged to avoid causing a sales follow-up bottleneck, targeted but several hundred names. Because of the value attached to the senior engineers’ time, marketing first went for a “hard” response, asking inquirers to agree to a meeting without an option to obtain additional information, and then further qualified inquiries by phone, including scheduling the free consulting sessions. When these sessions occurred, the manufacturer’s senior consultants helped their junior automotive brethren develop cost-benefit and production quality rationales for introducing these new adhesive materials—and even offered to accompany recommenders when they pled their case to higher powers.

Now on to the numbers. Because of the high revenue that a single assembly-line product application would generate, just two new applications in the first year would put the whole initiative, sales costs included, into the black, And with a long sales cycle-time projected, marketing and sales adopted two closes in twelve months as a short-term program goal. This was an easy sell to management because the company was really after the long-term opportunities management believed would open up across multiple car
makers—if they could just crack one target automaker’s approved materials list.

The outcome? At approximately six months out, the number of new assembly-line applications approved and specified passed ten. And before long, the new materials were shipping out by the truck-load. Short-term goal accomplished. Long-term goal achieved.

The moral of this story? In inquiry generation, assiduously avoid “ready-fire-aim.” Do your homework before you pull the trigger. Research, analyze, strategize and plan your implementation through the entire response management cycle—and do it up front.

INQUIRY QUALIFICATION IS UP NEXT: PART 3 of DICK LEE'S "Why not practice sales lead management" based series