The Annuitas Group Blog

Which Way Do They Go?

In spite of all the evidence that B2B marketing is changing, and that marketers need to engage buyers by building relationships, many organizations are still stuck in the past.  Evidence of this is in the fact that they continue to maintain a one-directional Lead Routing process:  leads only go from marketing to sales.  The result of this one-way, linear model is far reaching and results in …

• The inability to build a relationship with the buyer via lead nurturing
• Sales being inundated with names instead of leads, resulting in lack of follow-up
• The continuing of the ever widening gap between marketing and sales
• Lost ROI on marketing programs (See Counting the Losses)

At the end of 2009, we began a blog series where we defined Lead Management, debunked the myth that Lead Management is only Lead Nurturing and Lead Scoring, and began  describing each component in the holistic Lead Management process (See Much More To It! ).  This next installment of that series is on Lead Routing, another of the very important areas of focus in the development of a Lead Management process.

Lead Routing can be defined as “the mapped or documented process that determines how qualified leads will be routed to sales, and how sales will send not-ready-to-buy leads back to marketing.”

According to several recent research studies, up to 80% of buyers are not ready to purchase at the time they respond to a marketing program.  Since this is the case, the linear model whereby ALL leads go to sales doesn’t work (Why should a “not-yet-ready-to-buy” lead be sent to sales?)   To achieve a best practice Lead Management process, companies must move from one-way Lead Routing to a three-way approach:

1. From marketing (via campaign or marketing activity) to sales
2. From marketing (via campaign or marketing activity) to a lead nurturing campaign
3. From sales back to marketing for further nurturing and development

In addition to the three-pronged approach, marketing and sales need to establish Lead Routing rules to effectively govern the Lead Routing process. This is done through the use of defined Business Rules and Service Level Agreements (SLA’s). 

Business Rules are agreements between sales and marketing that define how Lead Routing will operate.  A Service Level Agreement is a time period affixed to the Business Rule that governs how long the recipient of the lead has to respond or process that lead.  Business Rules and SLA’s should be put in place for each of the three routes listed above – marketing to sales, marketing to nurturing and sales to marketing. 

To get started, here are some questions that will help you develop your Business Rules and SLA’s:

• How much time does marketing have to route Marketing Qualified Leads (or MQL’s) to sales?
• How much time does sales have to confirm receipt of a lead, making it a Sales Accepted Lead (or  SAL)?
• How much time does sales have to initiate contact with a lead?
• How much time does sales have to assign a qualification status to an SAL, making it a Sales Qualified Lead (or SQL)
• How much time does sales have to work an SAL or SQL through the pipeline before it gets sent into a lead nurturing program (This will depend on your organizations sales cycle and buying process

These are just a few questions to consider when developing your Lead Routing Business Rules and SLA’s.  And remember, proper Lead Routing cannot be accomplished without a defined Lead Qualification and Lead Scoring model. (See What Do You Mean When You Say That?).

Organizations that are serious about implementing an effective Lead Management process will not forgo this important piece of the puzzle. It’s too important to overlook and is often one of the key areas that allows the other disciplines to function fully. Conversely, proper Lead Routing will yield tremendous benefit including: 

• A better buying experience for your customer leading to longer term business relationship
• Better qualified leads delivered to the sales force, allowing sales to sell rather than qualif
• Better alignment between sales and marketing
• Improved ROI on marketing programs, and ultimately increased revenue

What Do You Mean When You Say That?

Several months ago I was meeting with a Director of Marketing Operations and we were reviewing their corporate lead qualification process.  As he explained how they qualify leads, I asked him if sales and marketing agreed on the definition of a lead.  He was quick with a “yes” and even showed me a document that listed all of the various definitions.  I was pretty impressed and pleased to see they had progressed to this level. 

My next meeting was with the company’s Director of Inside Sales.  During the course of that conversation, I made mention of the shared lead definitions that they had developed together with marketing.  He responded with “What definitions?” 

This is a scene that plays out all too often with companies:

• Marketing qualifies leads based on their view of the world
• Marketing sends what they define as “qualified leads” to sales
• Sales rejects them, saying they are not qualified

This scenario serves to underscore the importance of Lead Qualification as part of Lead Management. Lead Qualification will be the focus of this 4th post on Defining Lead Management.

Most B2B marketers qualify leads at some level.  However, few have taken the important step of developing and documenting a formal Lead Qualification Model.  Even fewer have developed a Lead Qualification Model jointly with sales. Yet research continues to indicate that companies that do indeed have a documented Lead Qualification Model achieve…

• Marketing and sales alignment
• A higher quality of lead being sent to sales
• Increased close rates
• Overall improvement on lead generation efforts

You don’t have to read too many B2B marketing blogs and websites to determine that “lead scoring” is a hot topic.  More and more companies are looking to implement Lead Scoring models, and the increased adoption of marketing automation systems provides an easy way to develop one.  However, rushing too quickly into developing a Lead Scoring model is putting the cart before the horse.  Lead Scoring is simply a numerical representation of your Lead Qualification Model.

Building and automating Lead Scoring without first building a Lead Qualification Model is like framing a house without blueprints.  If you want to improve your Lead Generation results, then you must first create a Lead Qualification Model. 

The Lead Qualification Model starts with creating Lead Qualification Definitions. In this phase, seek to include all phases of the buying cycle:  Inquiry, Response, Lead, Prospect, Marketing Qualified Lead, Sales Accepted Lead, Sales Qualified Lead Closed Deal, etc.  Conduct joint sessions with marketing and sales to develop and agree to definitions for each of these terms.

Next, develop a profile of your ideal customer.  This is also a joint effort between marketing and sales.  Determine what quantifiable traits make up the ideal customer.  Criteria such as size, location, industry, audience, etc. should be identified and documented.  Once you have the customer profile developed, use the same criteria to develop an ideal prospect profile.  These profiles are the basis of your overall qualification model.
 
Once the definitions and profiles are confirmed, proceed to working to define the criteria that should be used for Lead Qualification. This too is a joint exercise between marketing and sales. The objective is to create standards that will allow everyone in the organization to identify when a lead should be qualified for routing to sales, which leads should be nurtured and which leads should be discarded.

It’s only after these steps are complete that you should begin to develop the Lead Scoring Model (assigning numerical values).  This is where you apply numeric point values to BANT criteria (Budget allocation, Authority or role in the decision making process, Need for product or solution, Timeline), criteria used from your customer and prospect profiles, and behavior or interactions of the buyer. Behavioral components include items such as the number of campaigns prospects respond to, what events they are attending, what assets they download, etc.

So you see, Lead Qualification is more than Lead Scoring. It’s a systematic, defined process developed jointly by marketing and sales.  Companies that develop this kind of Lead Qualification Process as part of their overall Lead Management strategy significantly increase their ROI on marketing and sales activities.

One Half Down...

We all know the old adage “if you can’t beat ‘em, join ‘em.”  While in some circles that may be true, in the world of marketing and sales “if you can’t beat ‘em, complain about them until it seems like you are beating them” seem to be a more common sentiment.

Yes, the ever present gap between marketing and sales isn’t going away. It continues to plague a number of companies.  For example, 59% of attendees at this year’s Sirius Decisions Summit said they do not believe their marketing and sales teams are aligned.  Another of the many statistics that indicate the great divide between marketing and sales.

In thinking this through and even writing about it in the past (see We Don't Talk Anymore! – June 2008) I have come to believe that lack of alignment between the two groups is not really the core issue.  Lack of alignment is only a symptom of a greater problem.  The fundamental problem that creates the misalignment is lack of process.  Marketing and sales groups are misaligned because they lack common understanding, definitions and protocols.  As a result we have a modern day Tower of Babel in most organizations with each group speaking their own language and following their own plans, regardless of what the other thinks.

The first half of 2009 has already passed us by.  If you want to improve the value of your marketing and sales investment for the second half, start now by looking at any broken marketing and sales processes that currently exist.  Bring marketing and sales together to identify the gaps and fix them. Develop a process based approach where common terminology and standardized methodology is used.   Do all of this and perhaps by the end of 2009, you’ll be poised to hit 2010 with an aligned marketing and sales team that will lead to greater productivity.

We Don't Talk Anymore!

There’s been much talk lately about marketing and sales integration.  It seems most of the discussion centers around how marketing and sales technologies will integrate.  “Does our email program ‘connect’ to the contact manager?” “How will our marketing automation application interact with our CRM system?”  “How are the systems connected?” After all, marketing/sales integration is a technology issue, right?

Well, not really.  Yes, integration of systems is important.  But long lasting integration occurs when marketing and sales teams first address how to integrate their processes.  Before the discussion of technology tools occurs, marketing and sales teams should be looking for ways to integrate what they do from an operational level.  And the best way to do this is to talk about it. 

You may be thinking, “Well duh!”  But you’d be surprised.  Many of the organizations with which we’ve worked or interacted have had silo mentality when it comes to sales and marketing process. As is often the case between marketing and sales, one hand doesn’t know what the other is doing.  This often is the result of one entity simply not sharing information with the other.  And as the saying goes, in the absence of information, the imagination takes over. 

But this can be overcome.  When implementing lead management programs for companies, we usually suggest that marketing “reach across” to sales to begin the discussions on how to integrate.  This can be done by conducting group sessions, or independent interviews with a representative sample of the sales team. Areas of discussion should be assessment of current lead management processes, standardizing definitions, lead qualification practices, lead scoring, lead nurturing, lead routing, metrics, etc.  When the discussions are complete, summarize and communicate the findings, results and next steps. Schedule regular updates, and keep the communication “two-way”, allowing for feedback.

Bridging the gap between marketing and sales may seem impossible, but it can be done.  And doing this before moving forward with implementation will significantly reduce the roadblocks that otherwise could lie ahead.  It will ease the integration of marketing and sales processes, allowing the two to work together as a cohesive unit.

All A's???

Several years ago I was in a meeting with our VP of Sales for the Americas. We were reviewing our company's marketing programs for the last 6 months, as well as discussing our future plans.  As I started to go through the results of our lead generation programs, she stopped me and said "These numbers look good, but what I need are "A" leads, I do not think we should be spending money on anything but A leads!"  While I understood what she was saying, I gently began to explain to her why this thinking was flawed.

I simply began to ask questions so she could see why it was important to generate not only "A" leads, but "B" and "C" leads as well. In essence, yes, fill the marketing pipeline with smoking hot leads, but also add lesser warm leads.  The questions I asked were:

• How many leads can a sales person handle at one time?
• How many calls are the sales people making to these "A" leads on a weekly basis?
• How many deals will the average sales person close in a given quarter?
• How much time is spent per quarter by each rep closing a deal?
• What's more preferable: a steady stream of leads delivered over the course of the year, or all of them dumped at once?
• How important was it to the sales team that we qualify leads by provide them education on our solutions prior to sales interaction?

The discussion lasted about 30 minutes and then the light went on for her. As important as it is to have 3x in the sales pipeline, it's just as important for the marketing lead pipeline. 

The reality is that if sales only received vast amounts of "A" leads, they wouldn't all receive the necessary attention they deserved. Sales would only focus on the "really hot" leads that they could close that quarter.  A balanced pipeline of "A" leads (which are passed to sales for close), "B" leads (which will be nurtured to become "A" leads) and "C leads" (which will be nurtured to become "B" leads) will lead to long term success. This progression continues over time, and when running correctly, results in a good flow of qualified "A" leads being followed up at precisely the right time.  This well balanced pipeline approach produces the best results for both sales and marketing.