Why Lead Generation Based Marketing Fails In the Recession

In today’s economy, B2B marketers lament having their budgets slashed dramatically, yet they are still expected to do more with less. This has led to the creation of lead generation based marketing agencies, those that use tools like SEO and PPC to generate more leads for the sales teams. This seems like a great solution to stressed-out marketers because it looks like marketing has done its job by generating leads and it’s up to sales to close the deal. 

However, forcing your sales team to wade through countless untargeted leads is not the answer. This will lead to an angry sales team and as many of you know, marketing is often the first department to get cut. There’s the old saying, “sales brings in the money and marketing spends it.” If the sales team isn’t bringing in the money, marketing suffers. 

Generating leads is important, but it’s what you do with them that will make or break your sales. Fostering relationships and building trust will go much further than spending all of your money on long lists of leads. Our boss Brett writes how B2B has a much longer sales cycle than B2C. Generating leads and making cold calls may work selling to customers, but it is much less likely in B2B. Most initial sales contacts will be with someone who is not in the position to make decisions, or with someone who can’t make a decision immediately. Those are by no means failed attempts, especially in this economy when people simply aren’t buying. If you are there for your leads throughout the entire decision making process, when they finally are ready to buy, they will come to you.

The path to success is paved not only by lead generation, but more importantly through what MCG calls “demand generation,” which is defined as make people want your product. This achieved through gaining trust, brand strengthening, and fostering relationships. In this digital age, customers really need to know that your company and product are the best. Even if your name is at the top of a Google search, people still will not buy from you if they don’t know anything about you. 

A Marketo white paper writes about the theory of Social Validation, which explains that when people don’t have enough information to form their own opinion, they look for external clues like popularity, trust, etc. People want to know what their friends, family, or just what other regular people have to say about a product. People want to see people talking positively about a product. For example, on a company’s website, it can broadcast all tweets and Facebook comments in which they are mentioned. If all of the comments are positive, the company just got some highly powerful advertising for free. Other examples include getting your company name in polls and ratings. Build a good reputation and maintain trust with your audience, and customers will come to you.

Brand strengthening and fostering relationships with your leads involves building and maintaining awareness of your product. Make sure your company is mentioned on industry websites or blogs. Also, make sure to keep communicating with your leads. Invite them to events, update them on new developments within your company, or just call to check in. When a lead is ready to make a purchase, make sure you are at the forefront of their thoughts. You could have given the best sales pitch to someone who wasn’t ready to make a decision, but if you don’t maintain awareness, who says they wont have forgotten about you when they are? Make sure they don’t forget. When a company is finally ready to make a purchase, you have to make sure you are their top choice.

In conclusion, don’t spread your budget too thin on lead generation for a wide audience. Instead, focus your efforts on really closing the sale with a few targets. Integrate marketing and sales into one concentrated effort and you will see the results. Don’t define success by how many leads you can generate, but by how much money you can make from those leads.