Contact validation, profiling, and pre-qualification Article picked up by SLMA Blog

The title bar will link you to the Sales Lead Management Associations Blog which has posted a revised version of my article on contact validation, profiling, and pre-qualification.

Target account profiling & pre-qualification; Where is my phone?

Some weeks come and go without major or even minor revelations and some weeks have the those exhilarating and sometimes humbling "A-Ha!" moments in them. Those moments that expose a simple truth & basic solution to a problem we have created complex, and often times expensive, solutions for.

This week for me, offered one such A-Ha!. One that is so simple and basic it was too simple a solution to be worthy of my consideration. This may be an A-Ha you realized long ago, but none the less it is a basic solution to an ongoing problem that very few of us seem to put into practice. A basic solution that has been ducked, dodged, and avoided by almost everyone at the front end of lead life-cycle management for the past decade (since about the time much more complex and often costly solutions have become en vogue)

The "A-Ha!": If we want to know if a targeted account and contact is a fit for our products & services we should call them and ask!

B2B sales and/or marketing organizations like to spend little time and less money these days calling (yes actually speaking with) targeted accounts to validate and profile the companies and contacts they are targeting. Worse yet, many of us fool ourselves into thinking someone else, "a 3rd party expert," has figured out the secret to validating & profiling our potential users, influencers, and decision makers for us without actually speaking with them. Assured these 3rd party experts have it figured out we spend 10's of thousands of dollars for the data generated by "3rd party expert's" and their highly sophisticated profiling systems. We essentially "hope" ourselves into believing someone else has come up with the answer. An accurate and targeted master database and set of algorithms which filters on our company's specific user, influencer, and decision maker contacts. Stealing from the title of a book I recently read, "Hope is not a strategy."

My intent here is not dismiss or de-value the services provided by database and list service providers. Their services are a critical component in the process of gathering, and then winnowing down, the potential universe of industries, segments, organizations, divisions, and contacts we as marketers use to determine market size, segmentation, etc.. My "A-Ha" is a rip on those of us, myself included, who have relied on database and list services to deliver results they are not intended to, or capable of, delivering. Specifically, the list and database service providers cannot deliver Contact Validation, Target profiling, and Pre-qualification. We fall into the trap of believing that if a Contact has the title we are targeting, works for the "right" organization, within our targeted industry, and has an annual spend of $X on services we provide that the contact is pre-qualified, is the decision maker, and Sales just needs to call them and start the sales process!

Weather you have come to accept the truth or not, the result is almost always the same when we fall into this trap....Sales, and especially the good sales people, will rarely call a "target account and contact" generated from a list or service provider. In Sales defense, why would they? If they are worth their income they have a strong pipeline, referral network, and incremental revenue opportunities within their existing accounts. Don't get me wrong, sales people are more than open to engaging in new opportunities delivered from marketing. However, marketing delivered opportunities need to be at least as good, or better, in quality than the opportunities sales can, and do, create for themselves. At a bare minimum this means marketing needs to deliver a validated current contact which has been profiled and has been pre-qualified by parameters outlined and defined by the sales organization. I have not found a list or database service that can meet this standard, but we as marketer's continue to send contacts from these lists and database service providers directly to our sales teams.

Why? We won't make a simple phone call and ask some simple questions because we have sophisticated segmentation, profiling, analytics, and algorithms to do this simple work for us!

To be fair, another reason we purchase lists and database services as a replacement for phone based contact validation, profiling, and pre-qualification is the perceived cost delta and ill conceived budget alignment/constraints. What do I mean by ill conceived budget constraints? While a list service may cost $5,000 up front for very good database information on 2500 contacts it may cost $25,000 up-front to speak live with the 2500 contacts to perform validation, profiling, and pre-qualification. The $20,000 delta is a big hit to most campaign marketing budgets and they opt for the less expensive option. Unfortunately, the $20,000 saved in the marketing budget is spent twice over, not including opportunity costs, by the Company's sales force as they now must perform, in a non-process driven fashion, the same steps of contact validation, profiling, and pre-qualification. That is, if they call them at all after finding out the first (5) calls lead to dead ends.

Lead Nurturing; Part 4 in a Series

Well if this is your first visit to the site and your interested in more than lead nurturing which, in and of itself, cannot stand alone or be defined without speaking of the larger lead lifecycle management universe I would suggest starting at the series beginning. If your short on time, don't care about the entire ecosystem have at it and keep reading.......


Part 4 based on a Dick Lee series; Sales lead nurturing: Lots of folks believe that sales lead nurturing (a.k.a. “nurture marketing” or “permission marketing”)—is a relatively recent innovation, a child of the Internet. Wrong. A consultant named Jim Cecil introduced a concept called “drip marketing” back in the 1980s, and that started the movement that’s been gaining traction ever since. Even in the most effective implementations, the concept remains simple. Marketing offers B2B sales prospects—typically not-yet-ready-to-buy prospects—the opportunity to periodically receive information that will help recipients perform their jobs. The “sell aspect” to these materials should be subliminal and focused on establishing prospect preference by demonstrating goodwill. Prospects “opt-in” by agreeing to receive these informational materials. Then marketing develops or selects information of interest and sends it along, hopefully via prospects’ preferred channels. These “drops” or “sends” typically run on a set schedule, but certain market events like introduction of new products or issuance of difficult to interpret government regulations create opportunities for unscheduled communications. Periodically (and gently), marketing checks prospect readiness to purchase—most effectively via telephone, but via e-mail as well. And when prospects approach their actual purchase cycles—or want detailed information that only a rep can provide—marketing issues qualified sales leads to field sales, which does the heavy lifting going forward.
Simple. But, oh, how we screw it up.
It’s hard to practice drip marketing with a fire hose
First we have the yo-yos that trade in the faucet drip for a fire hose—blasting prospects with promotional drivel instead of usable information, until prospects either opt-out or drown. Then we have the advertising agency types that insist on “building the brand” rather than giving prospects usable stuff—all the while pretending that brand reinforcement adds value to customers. Huh? Then we have the anxious sales types that weasel the prospect list out of marketing and go make sales calls on everyone on the list—even though many of these prospects are more than a year away from initiating their purchase cycles, and others will never purchase. These blokes usually pester prospects to death until the besieged targets start ducking and dodging them, then rule them out of consideration. Hey, who wants to do business with pests? Just call the exterminators. And finally, we have the forever stressed out types who can’t ever get around to communicating with prospects at all. Hey, can’t afford to miss any meetings. Boy, does that send a loud and clear message to potential customers—or more properly, ex-potential customers.
But again, some companies do it right. Including my favorite car-seller, Lexus, which does a delicate, tasteful and informative drip on customer heads to maintain the relationship—and subtly implant the notion that no other car make will do.

A successful nurturing program
Lexus (I can mention the company name in this instance because I have my customer hat on, not my consulting cap) has the perfect customer-oriented culture for nurture marketing. Employee respect for the customer, including above-board dealings, sets the stage for “light touch” communication of
various types—ranging from thank-you notes to birthday cards (which I personally dislike, but no matter) to more usable stuff such as service reminders, service discounts, spiffs for referring first-time Lexus buyers, and very plush brochures satisfying customer curiosity over each year’s new models—all the while subtly whetting appetites for a new Lexus. Best of all, dealers (at least our dealer) lets us know that repeat customers are rewarded for their loyalty. And because Lexus dealers hire salespeople cut from the right cloth and pay them above market compensation, their sales reps tend to stay put, relieving customers of having to deal with a different rep with each new car acquisition—and providing the opportunity for relationships to grow.
As a customer you never feel bombarded. But you never feel forgotten, either. And what does Lexus get for its efforts? About the best repeat purchase/lease percentage in the business, if not the best. From the time you leave the lot with a new Lexus, you’re a prospect for your next car replacement. And the dealer starts gently nurturing and further reinforcing the relationship. It works. And I’m not an easy sell.

While a great example of nurture marketing I have to say the folks at Lexus have it easier than most of us. Afer all, who doen't like to daydream about a new car from time to time. For those of us in the B2B space it is more about educating potential clients on solutions, problems, and opportunities that our respective companies can help address. We do not start with a product or service everyone, or potentially anyone, may be interested in learning about because the have a desire or self directed need for what our companies are selling.

Up next, now that we have the nurturing engine going, how do we measure prospect readiness to engage in the selling process? Part 5: Lead Qualification and Rank/Score modeling.

Part 3 in Dick Lee Series: Inquiry Qualification

Inquiry qualification: If lead management has a “holy grail,” inquiry qualification is it. Ironic that it’s so pivotal yet still so rarely performed. While from a lead management standpoint failing to qualify inquiries is indefensible, it’s at least understandable. No other aspect of sales lead management is more labor intensive—and no other aspect requires a skill set less likely to be found in marketing, where lead management customarily resides.
Regrettably, inquiry qualification is virtually always the first cut when companies start fudging on their lead management commitments

Inquiry qualification typically goes out the window first when companies start bailing out of lead management responsibilities. Marketing says, “It’s too expensive,” and “We don’t have staff for it.” Sales says, “We don’t want marketing talking to our customers, even potential customers,” plus “We don’t have time for it.” Unfortunately, throwing qualification overboard is the epitome of “throwing out the baby with the bathwater.” A self-inflicted injury with dire financial consequences. But…dispensing with inquiry qualification does allow marketing and sales to point fingers at each other, shifting the blame back and forth so neither has to accept accountability for the lousy lead generating campaign performance. How convenient. And senior managers who could intervene usually go blithely about their business paying no heed to this debacle. After all, aren’t inquiry qualification and lead management as a whole just inconvenient “zits” that don’t merit management’s attention? Too bad senior managers don’t recognize that a marketing budget is a terrible thing to waste. As is scarce sales time.

Fortunately, amidst all the bad examples of inquiry management, or lack thereof, are some shining examples, including an express courier company that took head on the inquiry qualification challenge—and lived to reap bushels of ROI.

A CASE FOR STICKING WITH INQUIRY QUALIFICATION

Historically, this small package carrier hadn’t bothered generating sales leads. The marketing folks knew full well what sales would do with them. But along came a new marketing team charged with revving up sales—and soon. However, despite the “soon” edict, marketing proceeded at a deliberate pace. Before jumping into lead generation, marketing first contracted with a third-party service for comprehensive lead management: receiving 800# inquiries; receiving mail inquiries; tele-qualifying each inquiry and rating its sales potential; fulfilling each inquiry according to sales potential; issuing qualified sales leads to field sales; and tracking sales outcomes.
Among all the lead management aspects marketing put into play when the program launched, inquiry qualification was the deal maker. Following the “let Mikey try it” principal, the sales force as a whole waited for its more adventurous members to try out some of these “supposedly” qualified leads. And to their amazement, they were qualified. And they quickly turned into new business. And before long, new customer revenue numbers were up over 25% in some regions, and almost all reps nationally were willingly participating in the program.

Hey, there’s nothing like issuing quality sales leads to catch sales’ attention. Sales reps are naturally skeptical of sales inquiry quality—and deservedly so, with all the crap that gets forwarded to them. But when you send them only good stuff, visions of commission checks soon dance in their heads. Plus, marketing and sales can finally stop pointing fingers at each other. Even hold hands. Maybe........NEXT UP, Part 4: Sales Lead Nurturing

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

A case for lead management - Dick Lee (series)

For the next several weeks I will be leveraging a wonderful paper my company commissioned Dick Lee, Principal of High Yield Methods, to write. While I have made some modifications and added insight the major principles and text are from his paper. That said, here we go, I hope you enjoy reading it as much as I did!

A CASE FOR LEAD MANAGEMENT -

To the uninitiated, providing effective sales lead management seems daunting—almost too much to ask. And to the already initiated? The reality is worse than the perception. Rather than just “seem” difficult, lead management is difficult, causing many companies throw up their hands in despair and let poorly managed sales lead programs continue wasting money and sales time both. “Hey, most marketing money goes to waste anyway, and all sales people are overpaid and underachieving—so why worry about it?” Or, “Let’s just get an online CRM system and be done with it.”

Claims that MARKETING AUTOMATION, CRM, AND SFA software substitutes for lead management are lies we want to believe!

Despite the short shrift given lead management, I refuse to consider it a lost cause. Lead management is far too big a revenue and profitability driver to leave underutilized. And I even more emphatically refuse to let the slight of tongue tricks of CRM software salespeople stand unchallenged. “Lead management? Don’t worry. Buying our software will take care of it.” Lead management is about people doing hard work at often unglamorous tasks. CRM software merely lightens the load. And if you lack the human resources for inquiry qualification, inquiry fulfillment, nurture marketing and the like—buying CRM software doesn’t do squat to support critical lead management functions.

Unlike too many CRM software “success” stories, lead management successes have real numbers behind them. So, to be constructive, how about we try encouraging more lead management activity by sharing with sales and marketing managers a few tools of the trade? Hopefully, we’ll make mounting an effective lead management program look less daunting. Oh, you think I’m being an incurable optimist? I’ll argue the point, especially when we have successful, data-based lead management success stories to relate—as opposed to the fuzzy “success” stories too often surrounding CRM software implementations.

Okay, I am somewhat of an optimist. But here goes anyway.

Lead management frees up far more labor than it consumes, but still leaves marketing short-handed. While effective lead management creates labor savings in field selling that dwarf the labor marketing consumes across the lead management activity spectrum, the sales force labor saved does not convert into the additional bodies marketing needs for: front-end analytics; inquiry generation; inquiry qualification; nurture marketing; and tracking and back-end analytics. Instead, sales labor savings convert into more quality sales time available to sell more product and generate more revenue. Besides, even if increased selling efficiencies did free up sales labor for reassignment to marketing—would marketing really trust sales types doing any aspect of lead management? No more than sales would trust marketing to sell. Further, even marketing people typically lack the discipline and mindset required for most lead management functions.
But we’ll come back to staffing issues later. In the meantime, let’s review tools and techniques that help make each aspect of sales lead management boost sales revenues.
Front-end analytics: Within a lead-generation program, front-end analytics provide the radar that guides your message to your qualified targets—rather than causing “collateral damage” by landing everywhere except on target. Moreover, front-end analytics help you find the message that will best motivate prospective customers. And haven’t we all been on the receiving end of e-mail, direct mail and telemarketing messages that scream, “Not only don’t I know who you are, I’m clueless about what you want?”
Fortunately, some precision-targeted programs do hit their mark—communicating, “I know you, and I know how to help you”—including one program developed by a mega-FI (financial institution) with above average customer sensitivity........THE REST TO COME.

"Nurturing Relationship" not a sales phase in most organizations

My 15 years in B2B sales & marketing started off with 12-weeks of sales training with Eastman Kodak Company. Four years later, following my wedding and the start of my personal relationship nurturing journey, I took a job with Xerox as a High Volume Product Manager. With Kodak's training still fresh in my mind I was off to Xerox University in Virginia for 8 more weeks of arguably the best sales training program on the planet at the time.

In under 5-years time I had spent 20+ weeks being trained to be a super-human sales machine using methods from the premiere training programs of the day, SPIN, Relationship-selling, Major Account Management, etc. etc....I could profile accounts using "blue-sheets", cold call my way into almost any account, handle every objection, and track all my opportunities using activity driven sales stage definitions from a variety of sales methodologies (see below).

SALES STAGES:

1. Prospecting
2. Qualification
3. Requirements gathering
4. Solution Development
5. Proposal presentation
6. Negotiate & Close
7. Recycle and expand

At the time I had everything I needed to be a successful individual contributor and could ask for nothing more.

As is often the case, as a successful individual contributor I was promoted to manage a sales team, then a region, and eventually rose to the ranks of Director, VP of Sales & Marketing, etc. in various organizations. It was not until my responsibilities grew to combine Sales and Marketing that I realized what the best sales training programs, pipeline management systems, CRM tools, etc were missing. No one was tracking, or for that matter even responsible for, strengthening the inactive prospect relationship. In today's marketing lingo we call it Lead Nurturing, Lead Recycling, etc. Whatever you label it none of the sales processes and tools of 5 years ago provided a way to systematically drive and track "strengthening the relationship" with non-active prospects. Even today most of systems and processes organizations employ simply have an option to select "Inactive" in the CRM drop down menu for prospect disposition.

In defense of the sales trainers, sales managers, and sales force automation software firms, sales has been, and always will be, about the here and now. Active, accurate, and full pipelines leading to quarterly sales plan achievement is what it is all about. In defense of marketing; brand, lead generation, and positioning drive the day. What is indefensible is that people like myself, and people much, much, smarter than I, have let "strengthening inactive prospect relationships" fall through the cracks of our multi-million dollar systems, PHD driven processes, and continuous eduction programs.

To use a farming analogy, as sales and marketing leaders we are guilty of spending ever increasing amounts of time, money, and intellectual resources to increase the size of our fields in order to harvest a larger crop YoY. We spend money on better chain saws to clear cut more forest, we spend on new irrigation systems to get water to the new field cut from the forest, and we spend more on equipment and people to ensure we can cover our ever increasing acreage. Unlike real farmers of today, we spend very little of our resources on processes, systems, and technology to increase the yield from our current acreage by strengthening the relationship with the prospects and "lost" opportunities we already have.

Of course many of you reading this with a marketing background/role are now shaking your head at me saying to yourself, "my organization has been investing heavily in the area of lead nurturing, recycling, and profiling to increase our yields." The problem, until Marketing and Sales, together, have defined metric driven success measurements, implemented systematic processes that encompass both organizations, and defined end-to-end operating methodologies to execute prospect strengthening activities you will not succeed. Your intentions to increase yield per acre are there but you are, to go back to farming, like a farmer who has laid down the best quality seed and fertilizer to ensure yield increase but not necessarily selected the right crop to grow based on the market conditions or ensured the irrigation system will work when you need it to.

A quick test to know if you are there? Look in your CRM system with a sales rep at your side and ask him/her to show you the pull down menu for prospect disposition. If they do not have an option to select (STRENGTHENING RELATIONSHIP), (NURTURING), or something very similar your are not. You don't have to go look to know the answer do you? You have a slight variation of the (7) steps listed in the top of this article just as I use to.