Archive for the ‘trial period’ tag
The Hockey Stick Approach: Are Your Leads Shooting and Scoring?
A guest post by Jenny Vance of LeadJen.
Companies that judge the success of their lead generation program based on fast results are missing out on significant revenue that can be generated by taking a “hockey stick” approach to sales.
Marketers tend to judge the success of an outbound lead generation program based on a trial period equal to the average sales cycle. For example, if the sales cycle is nine months, marketers will review the outbound sales program after nine months to decide if it’s worth continuing.
Judging a program’s success based on this timeline doesn’t work, however, because it assumes that all leads are the same quality and have the same level of urgency. In other words, the only leads that will close during this trial period are leads who are ready to make a decision on the first day of the program. (Those leads already have the right contacts, identified pain points, and allocated budgets.)
Consider the Hockey Stick
In the analogy of a hockey stick, these leads would be the bottom of the stick, where it hits
the puck. They make up a small portion of your leads and do what they are expected to do. In my experience, these so-called “A leads” make up no more than 10 percent of a company’s leads.
That doesn’t mean that the other 90 percent of a company’s leads are junk, but it means that they’re not ready to make an immediate decision. As good salespeople can tell you, they cannot control the urgency of the buyer and whether there is an active, budgeted initiative in place prior to the first cold call attempt.
The real payoff of a lead generation program kicks in after the average sales cycle. Consider that the other 90 percent of leads can be ranked as…
- B leads. These are the right people in the right company, with identified pain but no budget or timeline. These leads typically make up 35 percent of a company’s database and can be expected to close in double the average sales cycle.
- C leads. Though the right people in the right company, they are still educating themselves on the pain points and do not have a budget or a timeframe. These leads typically make up 45 percent of a company’s database and can be expected to close in triple the average sales cycle.
- D leads. These contacts should be weeded out of the database because they are not likely to make a decision, regardless of the timeline. These leads tend to make up about 10 percent of a company’s database.
When the B and C leads begin to close, companies experience the hockey stick effect: significant sales over a longer period of time, as demonstrated by the handle of the hockey stick.
What You’re Under Pressure to Show Fast Results
Marketers can demonstrate the potential hockey stick ROI by combining educated assumptions about the average closing timeframe with the average close rate for A, B, and C leads. For example, at the end of the typical sales cycle, if 15 percent of A leads have closed, a safe assumption may be that 10 percent of B leads and 5 percent of C leads will close within their extended sales cycle. That helps marketers to set expectations about results.
This approach also gives the organization a line of sight to downstream revenue. As A leads are closing, B leads are into the next budget year, and C leads are being nurtured for the downstream closing potential.
MindStream Analytics, a consulting firm focused on helping clients improve business understanding and decision-making, experienced this hockey stick effect. The company augmented its inside sales staff with outsourced lead generation to grow sales and build awareness of the young company. MindStream Analytics has a relatively long and complicated sales cycle, and the company needed a cost-effective way to broaden its sales reach with new prospects and in new markets. The key to success was building brand recognition and reaching prospects when they had a specific need.
In 16 months, the company’s effort has generated appointments resulting in more than $400,000 in projects from new clients. More importantly, the effort has filled the MindStream sales pipeline with new prospects with projects valued at $1.6 million or four times the value of the A leads.
The company’s nurturing program is working. One client win came nine months after the initial contact.
“It’s all about timing,” said Mark Gregoire, executive vice president of sales and marketing at MindStream Analytics. He adds that it’s crucial to look at lead generation as a long-term effort because messaging improves over time as awareness builds. The company’s effort has moved from general messages to those focused on specific needs and verticals.
The goal is to contact a wider range of prospects over a longer time period and build awareness that benefits one’s company.
Jenny Vance is president of LeadJen, a B2B lead generation company that uses unparalleled data and insight to drive prospect interactions that convert to sales. She can be reached at jenny@leadjen.com or on Twitter.
(Photo courtesy of Bigstock: Ice Hockey Goal)
Spotify Premium Is Free for 30 Days with Mobile Streaming and No Ads [Spotify]
If you’ve been on the fence about checking out Spotify’s premium subscription, the service has just introduced a 30-day trial period to subscribe for free. More »
New Year’s Resolutions 30 Day Trial
It’s nearly December 1, which means that in just over a month, everyone and their cousin will be trying to change their ways for the better with New Year’s resolutions.
Resolutions are a tricky thing. On the one hand, significant dates on the calendar are a great excuse to make changes you might not otherwise be motivated to make, and lots of other people will be seeking to make change as well. On the other hand, attempting significant change normally requires some level of planning, which most people don’t do after the ball drops and the clocks change; the result is usually rapid failure.
So how do you take advantage of the energy of change without the associated planning failure? Here’s a simple suggestion: use the month of December to do a 30 day trial of your upcoming resolutions. Want to lose weight, quit smoking, etc.? Try it out in December and “debug” your resolution, so that you can work out all of the operational issues in advance.
For example, say you want to lose weight. The 30 day trial period will let you figure out how that goal will impact your finances and daily schedule. When during the average day will you have time to work out? What foods will you have to remove from your regimen, and what foods will you have to add? Try things out and see what works and what doesn’t for you, so that when resolutions season kicks off, you’ll be far less discouraged by bumps in the road than in previous years.
By doing the resolution trial run in December, you’ll also know it’s durable. After all, if a resolution of any kind can survive Hanukkah, Kwanzaa, Christmas, Ashura, and a variety of other occasions, then you know it’s going to survive the rest of the year.
The 30 day trial period is also a great time to do your research. For example, let’s say in the weight loss example above that finances are an issue, and you can’t afford a gym membership. Instead of that killing your resolution outright (as it often does in the early days of January), you can go Googling for fitness workouts that don’t require equipment beyond common everyday objects, then try them out.
Here’s the only rule of the 30 day trial period: you must pick one resolution and commit to debugging it for all 30 days. If you decide that in 2012 one of your key changes will be weight loss, then you must find a working methodology for yourself in December. You’re not allowed to change on December 12 to a different resolution, because you won’t be giving yourself nearly enough time to research and work around roadblocks.
Take today and tomorrow to make up your mind about the one thing that must change about you in 2012 and then on December 1, begin your 30 day trial and debugging period!
If you enjoyed this, please click here and share it with your network!
Want to read more like this from Christopher Penn? If so, please subscribe right now!
|
Marketing White Belt |
Watch me speak: Attend virtually! |
I recommend: for Twitter audience building. |
Related posts:
Orbotix Wants Sphero Beta Testers Before The Holidays Hit
Everyone’s favorite smartphone-controlled robotic ball got a minor facelift when we saw it last, but it may need just a bit more polish before it officially gets pushed out the door. That’s why Orbotix has quietly put out a call for private beta testers to play with the Sphero ahead of its launch later this year.
Of course, not just anyone will get their hands on a Sphero of their very own: Orbotix will only choose from US-based applicants who have already reserved a Sphero.
Those chosen few should also be willing to play with the thing on pretty consistent basis (Orbotix suggests a few minutes every day) to see how well it holds up to real world use. Beta testers will be able to spend a month with a near-final Sphero, but fret not in case you aren’t chosen: Orbotix is looking at adding new users on a rolling basis between October and November.
While it’s a great way to reward those who already pre-ordered, Orbotix seems to be cutting it just a little close with their timing. By the time their beta program finishes, the holiday launch window will be right on top of them. It won’t pose much of a problem if the feedback is unanimously good, but Orbotix could be caught in a dicey position if something unfortunate is unearthed during their pre-holiday trial period.