Marketing’s Lead Generation Responsibility to Sales

December 17, 2009

I had an interesting email discussion with one of the marketing managers at a portfolio company. The discussion started after I provided feedback on the company’s new website, wherein I suggested that most of the download/contact forms on the site be removed. You know those annoying forms that we have to fill on B2B websites that try to capture our contact information… so that we get on a mass mailing list and on a sales rep’s calling list.

My point to this manager is that a contact form is essentially a barrier between a visitor and the information that the visitor needs to make a decision… a decision whether the visitor has the pain point that the company claims to relieve, and a decision whether this is the right time to engage the company.

What Buyers Need From a Website

Buyers do all of their information gathering and decision making online. They don’t rely on salespeople spoonfeeding them information. By the time a sales rep calls a prospect, that prospect knows more about the company offering than the rep. A company website needs to be thought of as the ultimate prospect qualification vehicle. The visitor to the website should be given unfettered access to all the information that the company has available to educate.

The goal of the website is to segment visitors into information gatherers (who should be communicated with online via online content) and qualified prospects (who should be engaged through a sales cycle).

So get rid of all your contact/download forms, and let the prospect decide when he wants to engage (and make sure he has an easy way to do so.)

Marketing’s Responsibility to Sales

Which brings us to marketing’s responsibility, which is to deliver to sales:

  • the right amount of qualified opportunities
  • at the right time
  • to the right rep
  • with the right amount of information about the prospect.

Let’s make sure we understand this by looking at what marketing should NOT be held accountable for: delivering to sales as many leads as possible to keep a sales team busy dialing people who are not interested in buying from the company.

Salespeople are very expensive, especially relative to the cost of marketing and the cost of managing qualification filters. A sales rep should not be spending anytime calling on a lead that is not qualified or ready to engage.

Issues When Marketing is Motivated by Lead Volume

We find that marketing departments that are motivated by lead volume have caused the following issues:

  • Sales reps spend a significant portion of their time qualifying leads (super expensive, as it takes away from closing deals and on outbound prospecting)
  • The leads that go to the sales team set the tone for the types of customers the company ends up acquiring (which may not be the right type.) One example is a company that ended up primarily selling to customers that churned at a 50% rate. In that case, they were not only wasting the sales rep’s time with lead qualification, but also forcing him to engage with customers that end up churning in the second year, at a huge cost to the organization.
  • Lower average sales price. High volume unqualified lead flow drives a lower ASP sales engine. The only way to raise an ASP (other than product capability/positioning) is by focusing the sales team on high value prospects. This means fewer leads, more qualification, and more time spent on each prospect.

Therefore, Marketing’s success should not be measured by the number of leads delivered to sales, or by the ROI of dollars spent per lead. Marketing should be measured by the opportunities closed and won that originated from specific marketing campaigns. And as an interim, Marketing should be measured by the qualified opportunities delivered weekly / monthly per rep.

Definition of a Qualified Opportunity

So what is the definition of a qualified opportunity? Ahhhh, the million dollar question. In simple terms, I define a qualified opportunity as a prospect that a sales rep would feel is worthy of spending time with. And that depends on the sales rep capability and cost, the distribution model, and the average sale price.

In simple terms, a qualified opportunity to a field rep would be one that is being passed to him by a capable inside rep who had validated the prospect’s pain point, recognition of the company’s differentiation, and an intent to buy. For an inside rep, it may be a prospect that is being passed to him by a lead qualification rep who had validated a pain point and an intent to buy. For a telemarketer, it may be a qualified lead that meets some basic characteristics, that has self-qualified to some extent through the website.

The Chief Executive Officer

Firas was previously a venture capitalist at Openview. He has returned to his operational roots and now works as The Chief Executive Officer of Everteam and is also the Founder of <a href="">nsquared advisory</a>. Previously, he helped launch a VC fund, start and grow a successful software company and also served time as an obscenely expensive consultant, where he helped multi-billion-dollar companies get their operations back on track.