Milestone Group Quarterly: July 2003
Articles
Milestone POV:
Lead Gen for Lean Times
Virtually all software companies can use more qualified leads to pitch to - similar to one never being too rich or too thin. In the current market climate, sales forces are taxed with some combination of longer sales cycles, tougher competition, lower closing percentages/yields, and much smaller marketing budgets.
So how do you generate more qualified leads cost effectively?
Event marketing is often the most effective source of leads outside of referrals and sales partners. Trade shows attract less traffic, have become less reliable, and can be expensive in comparison. Events can include webinars, seminars, and co-sponsored conferences. The trick is to design them effectively, to manage expenses creatively, and to be highly disciplined about handling leads.
Designing effective event marketing requires several key factors. Foremost, customers respond to opportunities to hear valuable content and points of view about difficult business problems. Clever design means making sales as small a component as possible, even to the point of teasing the prospect by limiting the actual product or service pitch. An executive may want to hear a known industry analyst discuss a recent research report, or to interact with a consultant versed in their industry. Once this type of stage is set, the customer will be open to hearing expert points of view from an executive, particularly a peer or greater, of the tech company. The last thing that will draw a prospect is product pitching, so if the actual pitch is designed intentionally as a teaser, you increase the opportunity for a follow-on direct sales call. This approach demonstrates sophistication but more important, respects the customer because you, the tech supplier, is focusing on the intellectual capital you bring to the table.
Different products naturally require different event approaches. Higher-priced enterprise solutions may opt for the half-day or longer session with a smaller audience, limited to directors and vice presidents and above to give customers a useful peer exchange. This style should be very interactive. Let the customers talk with their peers. Other companies we have worked with have effectively used larger, shorter (two hour) seminars that yielded the same number of leads and cost less. The quality of this short seminar, however, is generally lower, and the quality of the relationships established in a short session tend to be lower and more transactional. Both types - as well as hybrids and others - can work, but again, need to fit the product being sold.
Managing expenses is as much about being tough as it is about creativity. One software company we know partnered with an industry consultant who contributed their time and marketing budget towards a seminar at the local airport hotel. The software company spent less than $5,000, drew 65 people, closed three new customers in the next quarter, and is still tracking seven highly qualified opportunities. This "scrappy" approach can work for a variety of different sized companies if they are vigilant about outsourcing, simply not spending too much, negotiating creatively with sales partners, and focusing intensely on results.
Last, being disciplined about subsequent sales follow-through may seem routine. Yet, we can’t tell you how many times we hear that the prospects who didn’t attend the event were never aggressively pursued, that every single prospect was not vigorously tracked with a sales tool, and that leads became individual sales rep’s knowledge instead of institutional knowledge. A trap is focusing on short-term, hot leads, and not nurturing long-term customer relationships for future potential.
In the end, event marketing succeeds or fails based on execution. Companies develop considerable skill upon repetition. They learn venues, they strengthen sales partner relationships, and they understand subtle regional business difference between for example New York City and San Francisco or Hamburg and Munich. The process alone becomes more efficient. The key is offering value to attract the right customers. |
