The economic pressure is not letting up and 2011 will demand more of B2B marketers than ever before. How can you deliver what CEOs most want – quality leads - within tight timelines and even tighter budgets? Where should you place your priorities? How can you rapidly make an impact on your company’s revenue capacity, profit, and growth?
2. Agenda
• Audience Poll
• Challenges and Trends
• Economics of Demand Generation and Lead Management
• Sales costs and a cost-avoidance argument
• A revenue capacity argument
• Metrics
• Summary – Key Takeaways
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3. Today’s speaker
J. David Green – Director of Best Practices, MECLABS
en &
id Gre or
Dav ayl
y J. ael C. S
• Case study: $1B pipeline in 20 months B
Mi c
h
• Author and co-author of numerous white paper, blog posts, articles, and
the book, The B2B Refinery®
• Speak at MarketingSherpa, DMA, and other events
• 25 years of wide ranging B2B lead generation experience
• Working with large Cisco partner on lead nurturing projects
• Consultant on technology channel marketing
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4. MECLABS: A science lab with a consultancy
• More than 10 years of research
• 1,300+ major experiments
• Over 1 billion emails
• 10,000 sales-paths tested
• Hundreds of publications and
conferences
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5. Audience poll
• How many direct or indirect sales full time employees do you support with
leads?
• 500+
• 100-499
• 50-99
• 20-49
• Less than 19
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6. Audience poll
• On a scale of 1-5, how advanced would you say your lead generation
practices are today? (5=best)
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8. What is the biggest worry of
innovative B2B marketers?
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9. The challenge
• In 2009, 68% of marketers saw generating high quality leads as their
number one business challenge.
• In 2010, the percentage rose to 75%
Source: MarketingSherpa 2010 and 2011 B2B Marketing Benchmark Report
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10. The challenge
For the last three years, marketers have focused increasingly on lead quality.
This focus, in turn, has placed greater emphasis on:
• Data hygiene and enhancement
• Lead nurturing
• Lead scoring
• Funnel metrics
• Alignment
The current economy intensifies C-suite demands on marketing for ROI
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11. What are the content implications
of lead nurturing and lead scoring?
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12. Based on trends in 2010 and projected for 2011,
nurturing and scoring depend on content
• More segmentation for relevance (personas, stage of consideration,
verticals)
• Low-production value content (e.g., blogs, raw video)
• More employee writers/thought-leaders
• More re-purposing/multi-purposing
• Content aggregation services through web-crawling and linkage/summary
• Integration of social media into lead nurture streams (as well as a demand
generation tool)
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13. What are data implications of lead
nurturing and lead scoring?
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14. Based on trends in 2010 and projected for 2011,
relevant content-nurturing requires data
• Less-end user data capture at the top of the funnel
• Incremental, optional, conditional end-user data capture
• Great focus on data hygiene
• Data appends (account, contact, triggers)
• Account-level modeling (propensity to buy and buying
potential)
• Content extrapolation of problems, function, level, depth
of interest
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16. How does sales leadership see the
economics of lead generation?
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17. Eight out of ten marketers hand
raw leads straight to sales
Source: MarketingSherpa 2010 and 2011 B2B Marketing Benchmark Report
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18. Mountains of leads, molehill of sales
New leads 40
100 Filled out web form, called toll-free number, visited booth, hours
attended webinar, etc.
Valid leads 28 - 34
70 - 85 Insufficient info, bogus info, hours
not in target market
Sales-ready leads 1.6 – 2.8
4-7 Lead scoring, tele-qualifications hours
Decline in lead population through @ up to 5 attempts/lead
the funnel’s early stages. & @ 10 dials/hour
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19. So what should those funnel
numbers mean in terms of expense?
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20. “Cheap” leads cost a lot of money
Annual cost Hourly cost
Loaded cost/ Field sales rep $ (200,000) $ (102)
Leads Hours Cost/Hour
100 New leads 100 40 $ (4,082)
70 Valid leads 70 34 $ (3,469)
Sales-ready leads 7 2.8 $ (286)
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Assumes 1,960 hours per year and 19,600 dials.
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24. Sales prospecting cost ≥ Marketing budget?
Sales prospecting
scenario In this example at 20%
of time spent on sales
Revenue $ 1,000,000,000
prospecting, the entire
Profit $ 100,000,000 marketing budget
Marketing budget $ (50,000,000) equals the portion of
the sales budget
Sales budget $ (250,000,000)
allocated to
Other expenses $ (600,000,000) prospecting.
Sales budget
line item
Time prospecting $ 1,000,000,000
Prospecting allocation $ 50,000,000
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25. Sales prospecting equals a lot of FTEs
Given that $50m budget allocation to sales prospecting from the prior slide, a
$200k loaded cost/field resource is the equivalent of 250 sales people.
Annual cost
Sales budget $ (50,000,000)
Loaded cost/field sales rep $ (200,000)
Sales FTEs 250
($50m sales budget allocation) / ($200k/rep) = 250 reps
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28. Sales & Marketing Resource Allocation & the Buying Cycle
Lead generation scales sales
100% These reallocated
sales resources
As much as possible, replace result in
Less these sales resources with lower- increased
efficient cost methods of marketing & revenue
sales Allocated telemarketing contact capacity/higher
resources percent of sales productivity
sales
More resources
efficient
sales
resources 0%
Prospecting Nurturing Selling
Buying cycle stages 28
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29. Sales-ready leads increase revenue capacity,
profits and growth
• 10% more selling time
Sales prospecting Scalable lead gen
• $10m increase in
scenario scenario
marketing budget
Revenue $ 1,000,000,000 $ 1,100,000,000
Profit $ 100,000,000 $ 190,000,000
Marketing budget $ (50,000,000) $ (60,000,000)
Sales budget $ (250,000,000) $ (250,000,000)
Other expenses $ (600,000,000) $(600,000,000)
Sales budget line item
Time prospecting 20% 10%
Prospecting allocation $ (50,000,000) $ (25,000,000)
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35. Key takeaways
• Lead quality concerns are driving initiatives in lead nurturing and lead
scoring, which both are driving numerous marketing changes
• Sales prospecting offers marketers a financial yardstick for measuring
lead generation effectiveness
• The cost avoidance argument:
• Sales qualification is very expensive
• Sales prospecting is very expensive
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36. Key takeaways
• The revenue capacity argument: lead generation can improve the sales
and marketing expense-to-revenue ratio (sales scalability and sales
productivity)
• The right metrics can improve forecasting and drive continuous funnel
improvement
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37. Contact information
Dave Green
Director of Best Practices, MECLABS
Co-Author of The B2B Refinery® en &
Gre ylor
vid
dave.green@meclabs.com J. Da ael C. S
h
a
Mi c
409-770-0710
MECLABS.com ∙ MarketingExperiments.com
MarketingSherpa.com ∙ StartWithaLead.com
StartWithaLead.com/LinkedIn
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