Why Salespeople Actually Hate Leads

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"Marketing is the effective and efficient use of frequent, relevant, focused communications to get people with similar wants, needs, pains and fears to know, like and trust you."

-- Rick Wallace  

Warm or cool leads generated by marketing are typically just annoyances to sales people--ones that get in the way of their "real" work.

You say no way - sales people want more leads!

OK I’ll prove it.

Two studies one by MIT and one by AMA Showed:

MIT Study

- 78% of sales go to the firm that responds first.

- Average number of follow ups 1.69.

- 61% of second follow ups become hot.

- 65% of ALL Business to Business leads will buy in the next 12 months.

AMA Study

At any given point in time only about 3% of the market is ready to buy what you are selling.

-   2% of sales are made on the first contact.
-   3% of sales are made on the second contact.
-  5% of sales are made on the third contact.
-  10% of sales are made on the fourth contact.

80% of sales are made on the fifth to twelfth contact.

Salespeople don’t like leads!

           - 48% of sales people never follow up with a prospect.
      - 25% of sales people make a second contact and stop.
      - 12% of sales people only make three contacts and stop.

     Only 10% of sales people make more than three contacts.      

There is a huge and very costly disconnect here.

Here's how smart companies address this disconnect with their marketing and sales teams to put a stop to the waste and increase revenue.

I have worked with many different sized companies helping them to scale their business. One of the key things I always look at is this: How does the sales force get leads, and what do they do with them?

Generating leads is at the center of most marketing mandates, yet most companies never really take full advantage of their investment in those leads. And when they think about scaling the business, they think they need to generate even more leads. I see too few companies invest in getting more revenue out of the leads they have.

One of the universal truths I have seen is that sales people basically hate leads that are generated by marketing. Unless, of course, the “lead” is ready to buy.

Note: Sales people only like hot leads. I don’t say this to take a shot at sales people. Effective sales people do a heroic job of cultivating their own business, and getting their own leads based on personal outreach, account development, and referrals.

That is precisely why warm or cool leads generated by marketing are just not helpful--leads that are not hot, to a sales person, are just extra action items, which get in the way of developing the business they are working on.

And think about it - who can come up with 5-12 ways to follow up with a prospect without “bugging them”.

A Joint Marketing & Sales Approach

The real goal should require a joint sales and marketing approach for marketing to deliver to sales leads which are of high enough quality (and "hotness") that the sales force actually is motivated to work them. And then the sales force needs to work them in a way that every lead has a clear outcome.

I have seen two very basic practices make a huge difference to increase revenue in this way.

Actually Use Your CRM System

In so many companies, the CRM system becomes a “write-only” database for leads. The information in it gets stale and out of date because it is not used as a day-to-day tool for developing business.

One time as a CMO, I investigated the leads that were in "Stage 1" of my company’s CRM system with people from sales, field marketing, and corporate marketing. “Stage 1” is where leads that have been fully qualified by a sales rep were supposed to live.

In an unusual fit of honesty from all involved, I got some real answers about the state of all the Stage 1 leads in our CRM System:

• Only a small percentage were actually Stage 1 leads. They were being actively worked by sales people who had qualified them and personally moved them to Stage 1. This was by far the minority.  
• Some leads were there because the sales people were getting measured on qualifying leads--so they just moved anything with their name on it to Stage 1 to meet that objective, and then just ignored the leads. 
• This behavior of moving leads without really qualifying them was also good for marketing teams being measured on Stage 1 “qualified" leads, so it mutually reinforced useless behaviors and inflated false success measures all around. 
• Some leads were there because even though the deal had been actively worked and moved forward in the real world to a later stage, no one bothered to update the status of the lead in the CRM system. 
•  Some leads were there because the sales rep left the company and they were never reassigned. 
• Some leads were duplicates. They were there because the sales rep created a new lead so they could get credit for generating the lead personally. If they deleted the original, marketing-generated lead, that would be giving the game away. 
• Some leads there were actually worked and found to be not qualified, but no one bothered to close them out.

…You get the picture. A lot of garbage in the system that both sales and marketing can point to and say, “Look how many leads we have!”

Then sales can ignore them entirely, because “there’s so much garbage in the system, you can’t tell what’s a real lead.” And marketing can get busy spending more money to generate even more new leads to “get their numbers up.”

Have Lead Review Meetings

Sales teams typically have weekly order or revenue review meetings. I have found that the most effective sales teams also have lead review meetings.

Imagine each week, if every sales team was looking at their assigned leads in the CRM system and every sales rep had to report on the status and progress of each and every lead that was assigned to them.

Reviewing every lead in the system every week is how sales teams turn leads into business. It keeps the good leads moving forward, ensures that garbage leads get deleted, and that all leads are worked one way or another.

This is not just about forcing sales to use the system, so everyone can have a nice, clean system. This is about developing business and making sales.

This works. The more focus sales teams have on the development of leads, the more business they get. It’s pretty black and white.

It’s also not a bad idea for marketing people to sit in on some of these sales lead review meetings to hear how sales is using leads and what is happening.

For Marketing: Don’t Waste Warm Leads

This qualifies as some of the oldest “news” on earth. I bring it up again now only because it is one of the most well-studied AND most ignored marketing practices: Continue marketing (i.e. nurturing) to warm leads. It’s cheaper and more valuable than generating new leads. Simply look at the facts above to convince yourself of this.

Companies spend money to generate new leads and have a process to qualify them. The hot leads get worked on, and the rest get thrown away (or thrown into the CRM system and ignored). Then marketing does another program to get a new crop of leads and the cycle continues: Hot leads get worked, warm leads get wasted.

Again, sorry for this very old news (warm leads are really valuable), but think about this…

Why not instead, only deliver hot leads to the sales force? Keep the rest in marketing and keep nurturing them until they are hot. Then give sales people fewer, but actually hot, leads.

Sales people will love (and work) these leads. And the marketing team will build credibility and value in the company by clearly making a more direct impact on revenue.

The company will get a far higher return on its investment in generating leads, and these joint sales and marketing practices will fuel real growth.

How do you to nurture leads?

In short, send out short informational TIPS that solve the pains and fears of your customers and prospects.  No selling at all, just relevant information. Short emails - some may include short videos. Do this every month or every two weeks and then when these “leads” are ready to buy they will think about you. They will build trust in you because you are serving them with good information and not trying to “bug them” with selling copy and phone calls from “sales people”.

Remember the stats above - 65% will buy in the next 12 months, 80% between the 5^th and 12 contact.

For more information on building a simple Marketing Machine to nurture leads see this link.

Rick Wallace