Investigating Effective Lead Generation Techniques
There is always some degree of turnover in any customer base. To keep a business growing, it is essential to generate new prospective customers, or leads. There are many ways of accomplishing lead generation, depending on the product and customer groups involved, but whatever the method, the primary purpose is always to obtain data on potential customers for subsequent follow-up.
Lead generation is vital to the development of new business. Turnover is a fact of business life—some customers just stop buying, or they move to competitors. Lost business must be replaced, and new customers added, if sales are to grow. Sales teams must have a constant flow of new leads in order to maintain or increase business levels.
The best source is the one that produces the highest-quality leads—that is, those with the most potential to convert to sales. Some programs produce a high number of leads, but they might all be poor quality. A publication, a direct mail program, or an event that is precisely targeted can be an effective source of leads. Track the success rates of various lead generation activities to determine the right formula for your business.
Incentives are not essential, but they often help to encourage individuals to place inquiries. The incentive should not be overly generous, however, or it will attract too many poor prospects who are more interested in free gifts than in your products.
To generate leads from marketing campaigns, include a response mechanism in every communication and make it easy for prospects to reply. Obtaining leads should be a priority, so ensure that your communications are designed to deliver.
To generate leads via advertising, make sure the campaign includes a call to action. Sample calls to action include:
- send for more information;
- reply within seven days and receive a free gift;
- send for a free report;
- subscribe now and get the first two issues free;
- call for a free consultation;
- reserve now at a special price;
- order now and receive a significant discount;
- visit our Web site and learn more.
To obtain high response rates, it must be easy for prospective customers to respond. The most popular response mechanisms for print media advertisements are e-mail addresses, toll-free telephone numbers, and Web sites. These are easy-to-use mechanisms that can elicit strong customer response. It is important to monitor the different response levels from various sources to determine which is the most effective for your organization.
Many publications include a helpline number or reader response card. A reader response card is included in a publication and used by readers to indicate advertised products in which they are interested. For example, a particular product advertisement in the publication may include the message "For more information, circle #15 on the reader response card." The reader sends the card, with any/all responses indicated, back to the publication, which then distributes the inquiries to individual advertisers for follow-up.
An advertorial is a piece that runs in the press, describing a product or service, in which customers are offered the opportunity to win a prize in return for supplying basic data or completing a short questionnaire. This can be a cost-effective way of generating leads. The questionnaire might contain items such as "Give three reasons why Product X is the best on the market." The information requested could be the customer's straight opinion, or an answer to a multiple choice question, based on information in the advertorial. Open-ended questions can provide valuable insight into customer attitudes.
Increasing numbers of television and radio commercials now employ an integrated approach, including a response mechanism such as a phone number, or complementary media such as a Web site. This approach might direct the audience to a source of further information or a retailer, or it could incorporate a contest, survey, or other activity to further engage the customer's interest. The response mechanism must be clear, because the audience of a radio or television commercial has only a short time to note the details.
Direct mail can be used at various stages in a lead generation program. When using a direct mail campaign to generate leads from lists that have not been previously qualified, be sure to include a response mechanism so that follow-up can take place.
Product packaging presents another opportunity to generate leads. Special offers might be featured, where buyers send in a coupon or other proof of purchase, together with their name and address. While in this case the individual responding is technically already a customer, by identifying that person and gathering more information about them, you are able to start building a relationship. Lead generation is just as important in this context.
Visitors to retail outlets are another potential source of leads. Many retail shoppers remain anonymous to the retailers they patronize. Encourage shoppers to provide names and addresses by running contests, drawings, or other special offers.
A Web site registration process can provide high levels of useful information. Request customer information when a customer visits your Web site. Registration forms can be easily completed online and submitted by e-mail. Offer customers an option to receive email updates with details of products and services that are of interest to them, or notice of special offers and promotions. Incentives such as free reports, free software, or discount coupons can encourage higher levels of registration.
Participation in exhibitions and other marketing events offers much opportunity for lead generation. Visitor registration should be an integral part of exhibition planning—establish a process for capturing data on all visitors to the booth, table, hospitality suite, etc. Establish a database of event attendee contacts, and use it to plan a subsequent contact program.
Many business and trade publications feature news about recent appointments, or interviews with leading executives. These articles supply names of potentially valuable contacts. The appointments pages can also alert you to changes in personnel at one of your customer or prospect companies.
Telemarketing can be used to generate new leads as well as to qualify existing leads. A telemarketing team might contact target companies to identify the key decision makers. The team can also contact individuals who have made an initial inquiry, to qualify their interest and potential. However, keep in mind that in today's climate of "do not call" lists, many individuals react unfavorably to unsolicited phone calls—which can lead to significant fines if they do not fall within the laws. It is very important to be contacting the right people when performing telemarketing.
As discussed above, lead generation programs can be integrated with other marketing activities—such as an exhibition, advertising campaign, or sales call. With integrated campaigns, overall awareness levels among customers and prospects will be far higher, resulting in a greater chance of success.
Contact lists are typically obtained or derived from a variety of sources. To be of real value for ongoing programs, however, contact lists must be continually refined. To improve the coverage and utility of contact lists, follow these practices:
- make sure that new customer and prospect data are added to the list;
- include coupons and other reply mechanisms with every form of communication, and maintain the responses in your list;
- encourage the sales force to keep customer and prospect information current;
- maintain an active search program in appropriate Web sites, magazines, and newspapers to identify new prospects for your list.
Lead generation can be vital to your company's future. Without it, the customer base does not grow, lost customers are not replaced, and major opportunities in new or existing market sectors are missed. Only a small proportion of leads convert to customers, so lead generation must be an ongoing process.
The cost of a lead generation program can be measured by dividing the cost of the program by the number of qualified leads that it yields. Media costs for lead generation should be assessed and justified in the same manner as media costs for meeting other objectives.
Lead generation programs do not work in isolation. Corporate advertising, for example, helps to raise awareness among the target audience, which can in turn increase the effectiveness of direct mail and telemarketing campaigns.
Carroll, Brian.
Jobber, David, and Geoffrey Lancaster.
American Marketing Association: www.marketingpower.com