Lead Generation: 4 critical success factors to designing a pilot
In my last blog post, I talked about getting funding by framing a strategic lead generation initiative properly for the sponsoring executive. Let’s talk about the first step on the road to an improved lead generation capability – configuration of a pilot.
While there is an infinite number of ways to develop a pilot, a well-designed pilot depends on:
- The current gaps in your lead generation machinery
- Perceptions of lead generation in the C-Suite,
- The risk appetite of the company
- And your own credibility.
These four guiding principles, however, can help you scope a pilot in a way that leads to long term-success:
1. Start where the economics are most forgiving.
There are two big economic factors to keep in mind when designing a lead generation pilot.
The first is the deal size (or annual recurring revenue or lifetime value). The smaller the deal size, the lower your lead costs must be. Getting to a low cost per sales-ready lead takes a great deal of efficiency and scale. So why target a market where you must be highly efficient to have success?
The second economic consideration is probability of purchase. Customers, for example, are typically more likely to buy something else from you than non-customers are. There may be vertical markets or other segments where your products or services have a better success rate. Responders are more likely to buy than non-resonders. The higher the probability of purchase, the higher your conversion is going to be and the lower, therefore, your average deal size can be.
Combining a high potential average order size with a high probability of purchase gives marketers the most room for mistakes and course correction. So play it safe.
Action item: Start with the most probable segment where you can sell big ticket items so that you have lots of room to experiment and course-correct and then test and iterate your way to the margins of your market.
2. Keep it simple
Lead generation has gotten very complex. You are not going to be able to optimize everything at once. So don’t try. Instead, tackle things in stages and look for ways to narrow the scope: fewer sales people receiving leads, a single solution area and/or market segment, and so on.
Action item: Once you determine where the low-hanging fruit is, figure out how to narrow the scope of what you’re doing so that it manageable by clarifying the objective and using that objective to simplify the pilot.
3. Make the pilot long enough for course corrections
Too often, marketers do not give themselves the room to learn and improve. New teleprospecting reps, for example, need 30 to 60 days to get reasonably good at what they do, and that’s assuming you have the right playbook and training to give them.
You may need time to see what competitors are doing, analyze online traffic patterns, refine your service level agreement with Sales for the pilot, or any other of a number things. But most importantly, pilots should be experiments in optimization so give yourself long enough to:
- a) course correct
- b) sample properly
- c) gather sufficient results.
And the longer the buying cycle, the longer it will take to get more definitive feedback on the outcome of the leads. And the lower the traffic, the longer the test must continue to gain sufficiency to project the results with the necessary confidence level.
If possible, make the pilot last for an entire fiscal year with the understanding that you’ll come back to management sooner if possible with a plan for scaling the initiative. That way, you won’t have to go “dark” while management decides on the speed of scaling your lead generation initiative and you’ll have plenty of room for testing and optimizing and tracking results.
Action item: Develop a conservative timeline that shows key milestones at particular stages. Make part of the deliverables of a milestone or two the new knowledge the company will have about optimized lead generation processes.
4. Base the measurement of the pilot on what you can control .
While you ultimately want to drive revenue, you can only control the quality of the leads you give to sales people…not what they do with those leads. So only promise the executive stakeholder(s) that by the end of the pilot, you will give salespeople what they ask for at least 75 percent of the time (90 percent or higher is possible).
You can and should refine your customer profile and lead definition and perhaps even the follow up and reporting processes. That’s what the pilot is for, in part. With enough experimentation, you’ll get to a definition that works for sales and that marketing can deliver consistently and scale.
Action item: Collaborate with sales on an ideal customer profile, a lead definiton, and the follow up and reporting requirements you will need in exchange.
Lead generation is a set of capabilities, processes and practices that you can always improve. So it’s a never-ending journey. And these four design principles will give you the best opportunity for that kind of long-term success.