Engage New Customers from IBD

Engage New Customers

Michael Mink

   Lead generation is one of the least understood forms of marketing, but it is the only way that companies bring in new customers and increase revenue, according to David T. Scott, author of “The New Rules of Lead Generation.”

   Here are some tips to make lead generation work for you:

   Set solid goals. Scott finds that some outfits plunge into campaigns with no idea of their aims, how many leads they’re trying to bring in or what level of cost-effectiveness they must observe.

   Often, “they’ve gone over budget or executed a campaign that has provided them with a minimal number of actionable leads,” he told IBD.

   Define success. Is a quality lead one that turns into a sale or into an action such as getting customers to download a white paper?

   “You need to have a plan in place for how you will qualify and use the leads you acquire,” said Scott. “You don’t want to spend a lot of money acquiring leads with a new tactic and then have those leads slip through the cracks because your marketing or sales teams aren’t sure what to do with them.”

   Measure. Scott has found that when a campaign is over, companies often have no idea how well lead-generation tactics worked toward ROMI, or return on marketing investment. Companies do better when they use a formula to get a handle on quality leads.

   Zero in on analytics. The brand that does so wins, said Brett Lauter, president of Decluttr, which sells media products such as CDs and DVDs.

   “Lead-generation metrics aren’t just about cost per acquisition but driving response rates, conversion rates, etc.,” Lauter said. “Recently we almost dropped an online display-advertising placement because its cost per customer action was high, but a closer look within the channel showed a wildly high click-response rate. Once we optimized the conversion of those clicks, it performed well above the target. If we hadn’t dug deeper into the metrics, we would have lost those efficient acquisitions.”

   Look for new strategies. Don’t get comfortable, even if your current lead-generation tactics work well. New ones can supplement current methods, Scott says. Also, they might be more efficient at providing quality, cost-effective leads.

   Lauter puts it like this: “It’s not ‘Mad Men’ marketing/advertising anymore. Marketing executives and agencies must understand metrics and ROI. Many are still stuck in old-school marketing. They came from traditional branding and are not able to transition to direct-oriented, metrics-driven marketing. There are ways to make them work together, but many people and agencies from traditional ones cannot make the leap.”

   Phase them in. Adopting new lead-generation tactics can be expensive and not provide instant ROI, so they need to be done systematically, Scott cautions.

   In the meantime, maintain your lead-generation efforts. “Obviously, you don’t want to suddenly switch to new, untested tactics or divert essential marketing resources from existing successful tactics,” he said. “This could cause a sudden drop-off in your incoming leads.”

   Don’t overcomplicate it. Respond properly and delight prospects. “Do that and they’ll return, regardless of whether we were operating 20 years ago or in today’s 3.0 e-commerce world,” Lauter said.

From Investors Business Daily, Tuesday, May 6, 2014, page A3