The Most Important Factor in Your B2B Lead Generation Budget

Oct 1, 2015

By: Asad Haroon

If yours is like many businesses today, probably one of your main concerns is how to sustain continued growth while still keeping within a reasonable marketing budget.

When it comes to B2B lead generation, how do you know how much of your marketing budget to invest? It’s not as complicated as you might expect. With a few simple calculations, you can be sure you’re on the right track and that your investment is more than a mere leap of faith.

Many B2B marketers become frustrated when they don’t see an immediate return on investment from leads, especially when evaluating leads from a new source. But it’s important to remember that sales cycles for most businesses average about three months. Even with qualified leads, will be some time before you begin to see a return on your investment.

You’ll also want to be sure you’re using the right metrics when evaluating your leads. For example, if your average sale per customer results in $250 in profit in the first year, and you purchase 10 leads at $25 each, with a ten percent conversion rate to acquire that new customer, you might conclude that you merely broke even on your investment.

Not so, if you consider customer lifetime value (CLV). This metric is being used increasingly as the best measure of lead value. CLV reflects the present total value of a customer to the company over his or her lifetime. When we discuss CLV, we typically refer to the value of a single customer, using the average sales of such a customer. The model of CLV can be broken down as a function of these three elements:

TP: Total Annual Profit (Total Sales – Cost)
TC: Total Customers
CL: Average Customer Life (in years)

Using these elements, customer lifetime value is calculated as CLV = TP X CL.

Although CLV could measure the customer’s value over his or her lifetime, most marketers use three years (based on considerations surrounding product life cycle, customer life cycle and profit calculations).

Now when you calculate the CLV of a single customer, you will see just what the true value is of your investment in leads. Plus if you factor in any repeat or additional purchases made by each customer, that $250 profit can turn into several thousands of dollars over the term of their relationship with you.

Companies like Amazon, whose average customer purchase may only be $20, typically spend significantly more than that sum in marketing dollars to acquire each customer. Why? Because they look beyond the initial buying cycle. These savvy marketers know that over a period of several years, that customer may very well spend thousands of dollars.

Your B2B lead generation dollars are an investment in the future of your business. You can be confident of maximizing your return when you start with pre-qualified leads who have indicated a readiness to purchase your services or products. Although lead buying should not necessarily be your only means of marketing, working with a good B2B lead generation company can complement and enhance the marketing efforts you already have in place.

Generating qualified leads can be a complicated process, but a good lead generation company can specifically tailor the lead acquisition process to the needs of your business so you can be certain you’re working with quality leads–leads who are actively seeking the services you provide and are more likely convert to longtime, valuable customers.

Seven Best Practices for Effective Lead Management

Sep 3, 2015

By: Arlette Measures


Even the highest quality leads will not yield the best results if they are not properly managed, nurtured,and tracked.

According to lead management experts at Marketo, only 25 percent of new leads are sales-ready, and another 25 percent are disqualified, leaving you with 50 percent of your new leads that are potential customers. Implementing a strategy that includes known lead management best practices will help you draw the maximum potential from those leads.

Successful lead management includes capturing leads at the moment they are seeking your services, continuing to nurture the ones that are not ready to buy, scoring leads to determine readiness, and turning them over to sales at the right moment-when they are ready to purchase.

Using effective lead management, you can educate your buyers while gaining essential insights into their needs, and ultimately create more revenue for your company.

A survey of top lead management companies resulted in the following best practices for successful lead management:

1. Nurture leads before sending them to sales. (An exception to this would be if you have purchased ready-to-buy leads from a lead supplier. These leads should be contacted immediately, and the ones that do not close on the initial contact can then be sent to marketing for further nurturing.)

2. Become a thought leader in your industry. Assist your prospects in making informed purchasing decisions. Offer your expertise to help them weigh possibilities and issues they may not have considered on their own. If you provide guidance without pressure, buyers will begin to view you as a trusted adviser.

3. Work with sales to determine what constitutes a sales-ready lead. Take into account scoring demographics such as company size, yearly revenue, position within the company, and time frame for purchasing. If you have purchased leads from a lead generation company, that work has already been done, and you can pass these pre-qualified leads directly to your sales team.

4. Maintain good communication between sales and marketing. Let sales know what marketing activities each prospect has responded to so that, in turn, sales can tell you which of those activities

are producing the highest quality leads. Also, inform your sales team which services each lead is most likely to purchase, based upon the prospect’s inquiries.

5. Create qualifying questions, email templates and call scripts to help make your sales reps’ initial contact with each lead more effective. Using these tools when talking to prospects, your sales team can refer to specific interests the prospect has demonstrated by their activities, such as downloading a white paper on a particular topic. Continue to build on your understanding of each prospect’s needs.

In your surveys and questionnaires, be sure to ask questions that will help you gain new information, rather than what you already know about your prospect.

6. Don’t waste leads. Make sure sales follows up on each one. Reassign leads that aren’t contacted the first time around. Any lead that does not close as expected should be sent back to marketing for further nurturing. Every lead should be valued and cultivated through the often very long B2B sales cycle.

7. Track the results of individual marketing activities to gain a deeper insight than you would by simply tracking the lead source. If you are working with a lead generation company to supplement your in-house marketing strategies, many of the best practices listed above, such as lead scoring and qualifying to determine which leads are sales-ready, will have already been done by the lead supplier. These leads can be presented to sales for immediate contact. Using pre-qualified leads can take some of the pressure off your marketing team while keeping the pipeline filled. The same nurturing and results-tracking practices should be applied to any purchased leads that do not close on the initial call.