It’s the last week of the month and the sales team is scrambling to get signatures on 3 deals that have been lingering for several weeks. The company needs to close the deals in order to reach its goalsbefore the quarter closes. The contracts are held up, either by legal or a new internal committee, and the scrutiny on the rest of the sales pipeline intensifies.
This scenario is becoming just as common at large, publicly-traded software companies as it is for small start-ups in verticals from technology to financial services to health care and many other sectors. According to research from Wilton-CT-based SiriusDecisions, the average selling cycle for deals
$100,000 and over is 22% longer on average than it was five years, and there are 3.5 more people involved in the decision-making process.
As the complexity of the sales process has increased, most organizations are turning to their marketing departments to drive more leads into the pipeline and also to create tools that will advance prospects through the sales funnel.
This has been challenging for marketing executives because the expanded responsibility for revenuecreation has been piled on top of their traditional branding work, and has often come without additional budget or staffing.
To help address these new business realities, leading companies have utilized solutions that have automated their demand generation processes, with goals of better measuring their marketing investments
and ultimately building stronger alignment between their sales and marketing organizations.
What these early adopters have often learned through trial and error is that each phase of the demandgeneration funnel requires a strategy for process, people and technology. In addition, most firmshave found that tuning up one component of their demand generation strategy will be limited if other parts are sputtering. Demand generation has proven to be a truly integrated, end-to-end, process and the smart companies are optimizing each phase of the process.
In this white paper we will look at some of the case studies and best practices that have been
identified in the following 5 key areas:
- Lead Generation Strategies
- Lead Management Processes
- Nurturing/Pipeline Acceleration Tactics
- Marketing Automation Tools
- Sales Enablement/Effectiveness
LEAD GENERATION STRATEGIES:
Filling The Front-End of the Pipeline
The first step for many companies in revving up their demand generation engine is increasing the quantity and quality of the leads being fed into their sales pipeline. Given the proliferation of the media landscape, lead generation has proven to be a challenge in its own right.
In order to get through the “sales pitch” filter that many prospects have adopted, smart marketers are constantly evaluating and monitoring which efforts are driving the most qualified leads for their team. Through this analysis, a common learning has been that content-based offerings around key industry topics—such as white papers and webcasts—are generating the strongest response from prospects.
A recent report from tech search network KnowledgeStorm and research firm Marketing Sherpa, showed that nearly three quarters of research and information gathering is being conducted online. The report, titled Connecting Through Content, found 72% of respondents start a search looking to find “solutions to solve a current problem.”
While this high percentage of online research may not directly correlate to other vertical industries outside of tech, it clearly demonstrates the opportunity marketers have to drive prospects by delivering thought leadership via the web. More specific examples of how some leaders have tapped into the growth of online are available in the nurturing and marketing automation segments of this paper.
The survey found that there is still a disconnect between marketers and prospective buyers in terms of the media they are using. For example, less than one-third of tech buyers claimed to access webcasts as their most frequent information source, while almost two-thirds of the marketers surveyed sponsor or use webcasts in their marketing.
The one medium that has consistently proven to be an effective tool for both buyers and marketers, based on the study, was white papers. Finishing ahead of case studies, product literature and analyst reports, 71% of the respondents indicated they read white papers frequently. White papers also topped the list of content that respondents shared with colleagues, being passed along 57% of the time.
The report emphasized the theory that marketers should focus their content on relevant industry trends, not thinly-veiled sales sheets. The quality of the content provided is critical to tech buyers, with 85% of the respondentsstating the educational quality of the material was very important.
LEAD MANAGEMENT:
Keeping Score of Your Best Prospects
For those marketers that have successfully built a lead generation pipeline, the next phase is learning that all leads are not created equal. By developing a framework to gauge which leads should be given the highest priority, companies provide more targeted information to prospects and ultimately accelerate their buying cycle.As part of its 2007 Demand Creation Tactics Survey, SiriusDecisions found that 52% of B2B companies with sales over $100 million already have some kind of lead scoring system in place, and another 26% have a system in development.
The definition and sophistication of a lead scoring system varies greatly by company and vertical industry. Newcomers to the practice are still sorting leads with simple A, B and C grades, usually based on company size and revenue, as a means to prioritize the biggest opportunities. More advanced marketers are creating qualifying guidelines and follow-up processes based on BANT (Budget, Authority, Need & Timing) scores.
Based on its Demand Creation Tactics Survey, SiriusDecisions found BANT scores to be the most common attribute marketers are using to prioritize their leads, with more than 2/3 of companies with over $100 million in revenue currently using BANT scoring.
The most sophisticated marketers are taking this prioritization beyond BANT scores and factoring in other attributes, such as how often a prospect has attended product demos or visited their website. Packaged lead scoring applications also factor in behavioral data based on prospects’ web site visits, responses to email offers, etc., including frequency and recency of activity.
While the emphasis at the front end of the pipeline is typically focused on generating as many leads as possible, companies that reach the lead scoring phase of demand generation typically end up passing along fewer leads to their sales team.
One of the biggest complaints among most sales people is that the leads they are given are unqualified, and wind up to be a waste of their time. Marketing executives that are seasoned in demand generation have addressed this by requiring that all leads are “sales ready” before they are passed along to the sales team. This process has proven to be a key step in building the confidence and participation of the sales force, and ultimately building alignment between sales and marketing.
PIPELINE ACCELERATION:
Nurturing Prospects Through The Buying Cycle
After gaining a better handle on which prospects should be given the highest priority in terms of their sales readiness, the top demand building companies have also developed strategies for keeping longer term leads engaged through each phase of the sales pipeline.
Often referred to as “sales nurturing,” this strategy typically involves identifying the biggest objections or internal hurdles a prospect must address before reaching the sales-ready stage. For example, a lead that had no budget identified for a project traditionally might have gotten filed away with no follow up.
Companies with advanced sales nurturing processes typically have a set of rules established that provide relevant and targeted deliverables to longerterm leads, designed to address each of their concerns and help move them closer to purchase.
Industry research supports that buyers are looking for different types of information based on where they are in buying cycle. For example, data shows that tools such as white papers and web seminars have been more effective with early to mid-stage leads, while offers such as ROI calculations and free trial downloads have been more effective with late stage prospects.
One of the strongest nurturing case studies we have covered recently was CenterBeam, an IT services firm which used an outside marketing firm to develop what it called a “lead farming” campaign.
In order to connect with its hard to reach CFO target audience, CenterBeam developed a multi-touch campaign designed to engage and qualify CFOs before turning them over to the sales team. The company calculated that it normally takes between 9 and 11 touches to engage a Clevel executive. Therefore, CenterBeam established a multi-media contact strategy consisting of telemarketing, voice mail, email and direct mail, often over a period of several months before a conversation with a sales person occurs.
The “lead farming” campaign has shown impressive results, producing 25% of the company’s prospects and accounting for 50% of its new sales. The campaign also helped demonstrate the value of long-term leads, with 60% of the deals CenterBeam classified as long-term leads.
MARKETING AUTOMATION:
A Jump Start for Sales Nurturing
In order for sales nurturing programs to work properly, an advanced marketing automation system is typically a requirement. These systems help companies identify leads when they take a defined action, such as attending a webcast, downloading a white paper or visiting a website.
Marketing automation tools can also help sales and marketing teams prioritize leads for follow up and ensure that they receive relevant follow-up information based on the content they have recently viewed.
For example, another case we recently covered was ShareBuilder Corp., an online provider of 401K plans for small to mid-sized businesses, has achieved impressive results with an automated nurturing program. Based on the recent web activity a prospect, ShareBuilder’s automated solution sends a realtime email designed to lead the prospect to the next topic on the site, such as case studies, articles and product demos. The brokerage credited the automated nurturing program with accelerating their best prospects (a 12% increase in deals closing in the first 30 days) and reviving older leads (250% jump in closing previously inactive leads/more than 12 months old) in the system.
Another area that has been significantly strengthened through the use of marketing automation solutions is the use of customized landing pages. These intuitive tools, which allow marketers to build targeted landing pages to offer relevant content and pre-populated forms to email recipients, have consistently helped increase registration and response rates.
Beyond these specific performance functions, analysts point out that the key deliverable for advanced marketing automation solutions is that they integrate all marketing activity back to web-based assets to that companies can have a greater accountability for all of their efforts and investments.
SALES OPTIMIZATION:
Enabling The Effective Salesforce
In addition feeding the pipeline with pre-qualified leads, another changing role for today’s demand-driven marketing organization is to provide collateral and intelligence for the sales team on key accounts. Scott Gillum, SVP for MarketBridge, a leading professional services firm that has worked with accounts such as IBM, MasterCard, Merck, SAP and Siemens, has seen the role of marketing shift dramatically at these leading companies.
“We are now seeing a lot of people come into marketing with experience in either the product or sales side, so they have more familiarity with the sales process,” Gillum said. “These teams help them build tools that will provide more about intelligence about a prospect. For example, a CRM system may tell you where a customer is in the pipeline, but it will not be able to tell you the reasons why they aren’t moving from one stage to the next.”
As part of this shift, Gillum said the sales enablement deliverables for the marketing team are often much different than the traditional branding output. “Now the sales team is looking for tools like online configurators or help organizing executive meetings in a specific region. These tools all help create access to different key points in the organization.”
Measuring Sales Performance
In addition to increased involvement from the marketing department, many demand-driven companies are also speeding up the pipeline by investing in Sales Effectiveness or Sales Productivity tools that move beyond traditional CRM/SFA systems.
Recent research from SiriusDecisions showed B2B sales people spend only 18% of their time face-to-face with prospects, while a larger amount is consumed with administrative duties and market research. A separate study from CSO Insights also supported the continued need to invest in supporting the sales effort.
According to the 2007 CSO Insights Sales Performance Optimization Report, 43 percent of reps are missing quota and 52 percent of forecasted deals result in a loss or no decision. Based on the increased complexity of closing deals as well as managing accounts, the rapidly growing choice of sales effectiveness tools are designed to enhance productivity, provide more time access to relevant news and information, strengthen presentations/communications, shorten sales cycles, and improve win rates.
Because timely information is critical in most industries, trigger-based selling solutions have been one of the most popular sales effectiveness investments. “Knowledge is the price of admission for sales people today,” says Jill Konrath, a leading sales strategist and author of Selling To Big Companies. “It is a huge competitive advantage to have timely information about your existing clients and prospects. It has really become a baseline item. You either have it or you don’t and if you don’t you can’t compete.”
Many demand-driven organizations have adopted automated trigger tools to provide sales execs with leads and insights into news and events within their territory or existing account base, which may indicate a readiness to buy.
Depending on the solution a company offers, these triggering events can include management changes, new product announcements, mergers and acquisitions, new financing, new locations, etc. The leading triggerbased tools monitor and mine large bases of business information sources and filter the information based on pre-set profiles so that only information relevant to their account base is provided. The alerts are typically delivered via email or through a web portal right to the sales person’s desktop or mobile device, utilizing
a pre-set profile.
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