Tag Archives: lead_generation

Revenue Growth: Don’t Let the Funnel Fool Ya!

Sales funnels symbolize a widely-known reality among marketers: s*** happens.

Funnels instantly remind us that interactions between buyers and sellers are fraught with risks – not that we need any reminding. Funnels also represent our fear that we can assiduously attempt to convert a prospect to a customer, but lo, there’s a chance we won’t prevail.

I like funnels because they are easy to understand. Funnels mansplain uncertainty and risk. When you need to justify a pipeline multiplier, or reveal the rationale behind a multi-channel lead generation campaign, simply fire a 2-D trapezoid shape onto the projection screen. Divide the image into equally-spaced horizontal stripes. Use bright colors. Then, dive into funnel taxonomy.  “Raw prospects enter the gauntlet at the top. From there, they undergo a metamorphosis, becoming Leads, then MQL (Marketing Qualified Leads), then SQL (Sales Qualified Leads). Those that emerge will be anointed as Opportunities before moving south, eventually crossing into a hallowed zone marketers call Paying Customers.” My presentation includes a bloated money bag positioned near the funnel’s bottom to drive home the idea. The screen glows even brighter. Warmth envelops the room. This is everyone’s favorite topic.

You already have recognized that my scenario is called The Happy Path. Happy paths, as we know, make people happy. Everything on the slide is linear. Everything is ordinal, with a prominent, single-headed arrow to emphasize the direction of actions, activity, and interest. The partitions between funnel stages are always crisp and distinct. “Questions? . . . No? Great! Let’s move on . . .”

I advance to the next slide to continue my speil when inevitably, someone – often a new hire – lobs a question with the antecedent, “What about . . .” I’m prepared. I press the “back” button, and ask, “Was there a question about the funnel?” Indeed. Many questions, actually. A partial list of ways to complete the interrogative:

. . . Lead qualification and disqualification, changed priorities, low buyer motivation, misaligned or insufficient sales incentives, faulty CRM data, lack of project funding, buyer fear, seller fear, redirected budgets, raised customer expectations, increased ROI hurdles, misunderstood needs, bad assumptions, new assumptions, strategic re-prioritizations, project starts-and-stops, buyer confusion, atrocious sales processes, predatory buying, industrial espionage, new decision hierarchies, flawed business intelligence, process breakdowns, competing internal agendas, technological innovation, tariffs, product recalls, spikes in monetary exchange rates, increases in the cost of capital, mergers and acquisitions, personnel changes, passive aggression, essential conversations that never materialized, relationships gone awry, cruddy demos, software bugs, regulations, external competitive maneuvering, internal competitive maneuvering, and stupid tweets from anyone with access to the company’s “official” Twitter account  . . .”

I don’t consider any of this the Unhappy Path. I call it Life. Here’s the problem: beyond their purpose for symbolizing risk, funnels don’t represent the myriad conditions companies encounter when executing revenue strategy and tactics. These examples obliterate the template funnel’s shape, and shatter that straight North-South arrow into countless, itty-bitty pieces.

For me, the funnel’s most meaningful features are its taper and length. The angle degree at the top should invite concern, interest, and discussion. “Our funnel is wide as a tank container at the top and narrow as a pipette at the bottom, and it takes one year to travel from top to bottom. Perhaps we’ve found the root cause for our cash flow problems.” In practice, few seem interested in dissecting the risks that cause the delta, and how to manage them. A funnel is a funnel. Counter-intuitively, the funnel’s ubiquity as a risk symbol has made us less risk aware.

Time for a fresh look.

Twitter abandoned its egg silhouette in 2017.  Assuming their objective was to render a human-ish image, the replacement – two detached shapes that faintly suggest a human head and shoulders – offers scant improvement. Imagine what we’d be purchasing if design engineers adopted such anonymized forms to use for prototyping. I suppose we’d have a visceral understanding of what daily life was like in the 1700’s. Similarly, how can companies create revenue strategy when using generic funnels as design templates?

Overlooked differences. At best, funnels suggest risk in marketing and sales. But they don’t mirror reality. I love Roadrunner cartoons, but for my safety and that of others, I resist letting them inform my understanding of physics.

Three real-world deviations from the funnel symbol:

  1. Pathway

Prospects enter sales funnels at many different points, not just at the top. Sales funnels are highly porous, and exit points vary, too.

  1. Re-cycling

Not every lead remains permanently outside the funnel. Prospects that have exited the sales or buying process can re-enter.

  1. Effort

Opportunities in sales funnels generally don’t drop from top to bottom on their own. As leads descend through the funnel, effort and costs increase for both sellers and buyers. In fact, if funnels reflected aggregate cost of sales, the model would be exactly flipped – small at the top, and large (or very large) at the bottom.

. . . And two overlooked similarities:

  1. Connectedness

As cash engines, revenue funnels are connected in several ways to the organizations they serve. They are not free-floating in space, as they are often depicted in presentations. Marketers implicitly understand that revenue funnels often receive inbound leads from a messy universe of opportunities, and that revenue flows from the bottom. But marketing funnels are but one component of a large system. They require additional input such as cash, information, talent, and other resources to operate.

  1. Throughput

With physical funnels, smooth material flow from top to bottom signal that the funnel is operating well.  But marketers often defer to a flawed proxy for funnel health: fullness. The problem is, full funnels can also be clogged. Rather than using funnel fullness as portents for cash-flow vitality, marketers should emphasize velocity and throughput as meaningful metrics.

 

General recommendations for funnel management: 

  1. Make sure the funnel opening is as wide as it needs to be, but no wider.
  2. Match the size of the opening at the bottom with the company’s revenue needs. That includes ensuring orders won’t swamp the company’s ability to fill them.
  3. Don’t take the taper for granted! Make sure it aligns with the company’s risk capacity.
  4. For planning purposes, net the funnel’s cash output against the resources required to operate it.
  5. Remember that throughput velocity is as important to consider as overall funnel value.

I’m not declaring funnels dead. Not by a long shot. The marketing and sales profession has long suffered from lack of probabilistic thinking, and funnels offer a symbolically-accurate representation of revenue generation risk.

Put another way, a picture that tells us  s*** happens is worth a thousand words.

The Dark Side of Online Lead Generation

Comedian Jerry Seinfeld made banality funny, but marketers exploit it for darker purposes.

Consider a Tweet I made recently: “I’m walking to Whole Foods after work to buy a 6 of local-brew #IPA. Suggestions?”

Without realizing it, I saturated this 81-character message with personal details, and shared it to the world:

1. I am over 21.
2. I live in an urban area.
3. I am employed.
4. I have discretionary income.
5. I drink beer.
6. I drink at places other than bars and restaurants.
7. I know people who have similar interests.
8. I seek the opinions of others online.
9. I am not brand-loyal when it comes to beer.
10. I am able to carry at least six pounds.

“There are eight unique data points per Tweet,” said Adrienne LaFrance, Staff Writer for The Atlantic. Here, I found ten, and my Tweet had capacity for 59 more characters. Lucky that I didn’t use them. Who knows what else I could have revealed.

Based on my innocuous Tweet, marketers can deduce that the car I drive isn’t a Hummer or a Cadillac Escalade. They can bet that I have a college degree. But that’s beside the point. They already know. Remind me again who has the information power, because it’s not me.

Every second, about 6,000 Tweets pulse through Twitter. Marketers mine this noisy digital exhaust to extract fuel to power their ravenous revenue machinery. Automated algorithms work 24/7 assembling details about individual human beings. By combining online and offline information about people, companies called list brokers create large files of personal artifacts. This information gets passed through a serpentine value chain, where it’s divided, changed, enhanced, and re-combined with more data. What gets harvested can be described as digital gold: richly-detailed profiles of consumers. List brokers package them into tidy, organized, fungible groupings called lead lists, vital for business development. Rube Goldberg would be proud.

But Goldberg’s whimsical imagination mimicked the physical world, where noisy events happen in plain sight. Lead generation processes depend on subterfuge. Prospect curation machinery works cleanly and silently, away from the public eye. Consumers are unaware about who (or what) collects their information, or who gets to use it. Reason #412 that I don’t wear a Fitbit, play online “brain games,” or use gene testing services. None of these businesses are required to comply with patient-privacy laws in the 1996 Health Insurance Portability and Accountability Act (HIPAA).

Many expectant or postpartum parents would be surprised to learn that their personal identities have been meticulously collected, and electronically shipped to and fro. Their names, and a whole lot more, are regularly sold to businesses, including eager telemarketers and digital agencies. For example, Dataman Group can sell you a New Baby List, which includes pre-natal families. Among the fields are contact information, home ownership data, dwelling unit type, estimated household income, number of months until birth, and whether the birth is (or will be), the mother’s first.

Dataman’s website makes a flamboyant appeal to its prospective customers:

Almost 1 out of every 2 births today is a first birth, creating enormous marketing opportunities.

Most first-birth families are also two-career families; working moms and dads with large, disposable incomes and no brand loyalties where child care products are concerned.

As a market, these growing families outspend childless couples 2 to 1 and are prime candidates for not only a full range of baby products, but also day care, home entertainment, photography, insurance, recreation, and catalog offers. Information on any product that your company offers that can offer these young families a better way of life will be welcomed.

No other life cycle list offers the accuracy, cost-efficiency or selections of OUR new parents mailing lists or prenatal list. You can even select Pre-Natal households by trimester….or New Babies by actual month-of-birth.

At the end of this sales pitch appears a curious request, one that hints at nefarious use: “Note: Sample mail piece and/or telemarketing script required on all orders with Children information. We support responsible marketing!”

Here is where things turn rough. With a selection tweak or two, marketers can bubble up motivated buyers – say, mothers in the third trimester, or people living more than one mile from a playground. So far, so good. But with additional tweaks, marketers can find greater buying urgency by exposing a related demographic: vulnerable buyers. Some more tweaks to reach buying motivation’s top rung: The Desperate. A lucrative target with tantalizingly short sales cycles, little comparison shopping activity, and low customer information power. All it takes to get the cash machine spinning is an appealing product, a little imagination, and the right search criteria.

How about targeting single moms below a certain income level, living in the 22 states that have declined Medicaid Expansion? That information would be attractive to rental appliance and furniture outlets, credit card companies, and loan providers. A warping of the ideal, “give customers what they want.”

This is the way revenue generation works in the digital age. A single New Baby lead list supports everything from aspirational selling to predatory marketing. Innovative baby backpacks to take small children on fun adventures,  or payday loans for food and rent payments when cash runs out. Which way you go depends on what you’re selling, and how you sort and select the prospects.

Information that list brokers use sometimes comes from landing pages designed to surreptitiously collect personal information, which then gets sold to others. When I entered the phrase, need money for food, into a search window, I received advertising links that assumed ancillary concerns: “Bad credit personal loan,” “500 to 20000 personal loan,” “sell your house fast,” and “are you eligible for aid?” These are emblematic of the marketing predations that occur, often in plain sight. The last ad, linking to a website ending in dot-com, clearly wanted to find out more about me. I did not click on it.

When I re-entered the same search phrase one hour later, the aid-eligibility ad had vanished, presumably because Google recognized the ruse, and removed it. In fact, in 2014, “Google removed 524 million advertisements and banned more than 214,000 advertisers from its search results. But predatory companies are still finding loopholes,” LaFrance wrote in an article, How Google Plays Whac-a-Mole with Shady Advertisers. Squashing 524 million ads per year equates to around 1,000 ads per minute. That’s a lot of Whac-a-mole.

I conducted this search as a simple experiment for this article. But what if my query was genuine, and my situation perilous? What if I proceeded to fill out the form? Who would have my information? What would I unleash? Sadly, there are few laws protecting prospects. Congress hasn’t passed a consumer privacy law since 2009. This, despite huge increases in social media use, advances in data science, and wide adoption of marketing automation. At least my beer purchase was discretionary. Vulnerable prospects face privacy hazards that are more poignant.

“This process for collecting customer data exploits a loophole in consumer protection laws. Companies can buy lists of people who have asked about diabetes, Alzheimer’s, or Parkinson’s disease. They can learn about victims of assault and people diagnosed with HIV,” said Aaron Rieke, Project Director at Upturn. Rieke was a panelist on NPR’s Tech Tuesday program, When Companies Use Your Online Searches Against You (November 10, 2015). “How did they get my name?” Amazement that happens all too frequently online.

It’s not just from hijacking customer trust, and stealthily scraping information from online forms. In 2013, 43% of free health apps sold users’ personal data, according to a study by the Privacy Rights Clearinghouse. “Fewer than half of mobile apps that collected health and fitness information provided a privacy policy in which they spelled out how user data could be shared, and 43% of free apps tested by the group shared personal information with advertisers,” The Wall Street Journal reported in April, 2015.

“The extent of consumer profiling today means that data brokers often know as much – or even more – about us than our family and friends, including our online and in-store purchases, our political and religious affiliations, our income and socioeconomic status, and more,” said FTC Chairwoman Edith Ramirez. “It’s time to bring transparency and accountability to bear on this industry on behalf of consumers, many of whom are unaware that data brokers even exist.”

“Technology gives us power but cannot guide us as to how to use that power. The market gives us choices but leaves us uninstructed as to how to make those choices,” Lord Jonathan Sacks wrote in his book, Not in God’s Name: Confronting Religious Violence.

Those conundrums occur every day in marketing. “We’re doing this because we can,” clients tell me when discussing their marketing strategies and tactics. I urge them to include an additional hurdle. “Ask yourselves, ‘what is the right thing to do?’

Note: this article was published on CustomerThink. To read the original column, please click here.

Marketing Software Designed to Make Buying Easy. Duh!

A bat and a ball cost a dollar and ten cents in total. The bat costs a dollar more than the ball. How much does the ball cost?

The challenge this problem poses doesn’t result from having to perform complex math. In fact, a savvy kindergartener has all the computational skills necessary to come up with the answer. The challenge comes from the persistent habit that we adult humans have for confusing ourselves.

That’s why business keynote speakers present this question to audiences. Whether it’s Dallas or Des Moines, this short, annoying word problem provides speakers a failsafe audience head-slapping moment. “Gosh, how did I miss that?” Segue to next slide showing how to buy $19.99 e-book about creative problem solving.

Business developers face the same challenge. When confronted with the problem, “how do we make it easy for prospects to buy?” they receive a flurry of disconnected ideas. “Webinars! Landing pages! SEO! Social! Blogs! Outbound! Inbound! Content marketing! Facebook! LinkedIn! Twitter! Lead Scoring!” No wonder many campaigns implode under their own weight, before a meaningful financial return has been realized.

Like the bat and ball problem, it’s easy to carelessly formulate the wrong answer by overlooking the easiest path to the solution. But one product I recently tested, Officer® Campaigner, helps avoid that mistake by providing easy-to-use tools that integrate traditional legacy marketing resources, such as direct mail, to newer online tools.

Officer® Campaigner provides a cloud-based software application tailored for small- to medium-sized businesses. These companies are often thinly-staffed, and they contend with a dizzying array of marketing resources. Officer® Campaigner helps managers sort through the choices, so businesses can combine tactics to help buyers buy—easily, efficiently, and predictably. Officer® Campaigner follows sensible, familiar steps:

1. Reach out to prospects
2. Track their behavior
3. Tailor the selling responses

With Officer® Campaigner, fliers and business cards can include QR codes that a prospect can scan with a mobile phone to obtain a coupon or promotion. Or, a business can offer a special discount by embedding a compelling video into an email that links to a purchase website. All the activity is managed and tracked within a single application. Pixl, the company that developed Officer® Campaigner, will even help clients set up the campaign.

Before adding consultants and complexity to your revenue generation challenges, look into Officer® Campaigner. It makes selling as easy as figuring out the sum of $1.05 and $.05.

Asking to Send Literature Is Not Lead Qualification

Some people collect stamps, some collect coins. The salespeople I spoke to at a technology trade show must think I collect PowerPoint presentations and Adobe attachments. In every initial follow up phone call I received—bar none—the contact center representative offered to send me sales literature. When were they planning to ask me about my product need?

I don’t know the answer, but it’s odd that even the most basic qualification questions aren’t asked in the first call. Here’s a typical exchange:

Caller: Hi. This is Joe Jones from XYZ Technologies. I’m following up because you stopped by our booth at the e-SoftSpot Show in Washington last month.

Me: Yes I did. I remember a little about your product. It’s a tool for searching databases for specific text information. I visited with a number of companies—I don’t remember much else about XYZ.

Caller: Well, we wanted to know if there’s any additional information you would like. We have some case studies we can email to you. Also, we’re holding a Webinar next week about our just-released Optimized Search Algorithm. I can send you a link so you can sign up.

Me: I can’t think of a specific need right away, but if you want to send me an email with your company’s website information, I’ll look at your site. If there’s a specific need that matches up, I can get in touch.

Caller: Sure. I’ll include the link. Once you receive it, if you have any questions, please don’t hesitate to call me.

We sign off the call and I go on my way, and Joe goes on his. As promised, he sends his email that day. It’s still unopened in my inbox.

The lost opportunity? Even though Joe took the time to reach me, he still has no idea whether his company is valuable to me—or whether I’m valuable to his company. Is there an unwritten rule in Contact-center Land that it’s uncouth to broach the “Q-word”—am I qualified? Or, are humans simply wired to offer marketing material without expecting anything in return?

I’ve worked with more than a few companies that describe a qualified lead in broad terms. Everything from a trade show attendee who signs up for a web seminar, to a prospect with whom they have held an in-depth discussion, and whose needs they think they can fulfill. That’s a wide strike zone. It’s understandable that salespeople are often jaded when marketing assigns urgency to leads when the pattern is that most of the leads tossed to Sales are consistently un-urgent. How many times did Chicken Little say “the sky is falling” before others failed to pay attention?

Why don’t companies capture qualification information early in the contact cycle? Is it because the contact center is measured on how many calls are made, how quickly they’re made, and how many “qualified” opportunities contact center reps pass to Sales? Or is it because what makes a prospect qualified is murky or poorly understood to begin with? Nicholas Carr, in his excellent book The Big Switch quotes George Dyson, a technology historian, as saying “finding an answer is easier than defining the question. It’s easier to draw something that looks like a cat, for instance, than to describe what, exactly, makes something look like a cat.”

Similarly, is it easier to slog down a pothole-filled sales road with a prospect, rather than understanding what, exactly, makes a prospect qualified? Whatever the answers, companies that don’t qualify leads early risk committing valuable resources on activities that are unlikely to bear fruit. Conversely, the companies that are adept at discovering a prospect “diamond in the rough” possess a huge advantage over competitors standing around the “we’ll-send-you-some-literature” starting gate. Reps who take the time to ask basic qualification questions face diminished sales risk, and benefit from faster sales execution. Better lead qualification enables a sales organization to step on the sales process accelerator.

What does qualified mean to me? Here are my top questions:

Solution fit: Does my solution provide an outcome that my prospect values?

Access: Am I able to hold a dialog with people who are influential and have the ability to decide whether to purchase my product?

Financial Resources: Does my prospect have the capability to pay me what I am likely to charge for my product or service?

Timeframe / motivation: Is my prospect motivated to purchase from me within a timeframe that matches my planning horizon?

I know. If your product or service is complex, these can be deep questions for a first-time follow-up call. The answers—if you can get them—often aren’t easy to populate into CRM system check boxes, and some believe that it still takes the judgment of an experienced salesperson to understand the qualification nuances. But even if it’s difficult to uncover definite “yes” answers to these questions, isn’t it valuable to at least uncover definite “no’s”? For example, what would it mean if you could subtract from your lead pipeline all prospects that definitely don’t need your solution?

A contact center won’t be able to uncover every risk, but unless sending marketing literature is its primary goal, the point of first contact is the best place to begin the vetting process.

Nobody Cares About Your Stinking Market Share!

Market share: when it’s big and beautiful, be proud!  But do your customers care?

Here’s what market-share hype sounds like in a sales call:

Salesperson: Our company has 45% of the fast-growing Tetra Pixel market!

Prospect: (silence) Oh. What does that mean for me?

Salesperson: It means that twice as many companies have selected us as their Tetra Pixel provider versus our closest competitor.

Prospect: Your competitor told me the same thing. I’m not sure what to make of that. Is your product twice as good?

Market share bombast can be hollow, and claims are easily fudged. “We’re number one (for unit growth in Latin America)!” “We have fifty percent share for revenue (in the healthcare market)!” “Numero uno for market share (in the Small-to-medium sized business segment)!” Add your own fine print and disclaimers. We’ve all trumpeted these platitudes at one time or another, and each one needs an asterisk.

In a sales call, crowing about market share can land with an ineffective thud. Or, it can even backfire. For example, when your prospect asks, “If you have the largest share of the Tetra Pixel market, how do I know my business is really important to you?” Market share claims are a two-edged sword, something biz-dev experts often don’t tell you. One webinar slide I read communicated the market share ideal using an odd equation:

“Collaboration is required to keep new people = productivity = market share.”

I couldn’t follow the presenter’s mathematical equation, so I asked him. He told me that  that senior executives often designate a specific market share as a strategic objective, and there’s a connection between that and employee retention and productivity. I’m not clear what that connection is, and based on his use of equality signs, and his lame “explanation,” it’s evident that he doesn’t have a clue, either. “Follow my advice, not my logic” is the inference here.  They don’t call it Death-by-Powerpoint for nothing.

The more useful, and in my mind, more intriguing question is, what value does market share provide companies and prospects? If an answer exists, it’s snarled in a messy knot of personal ego and cold numerical logic.

Sure, the vendor with highest market share can enjoy purchasing clout that enables higher production volumes, lower unit costs, and the profits that accompany them. But I can’t help but think of two well-known companies that relentlessly pursued market share bragging rights, and suffered miserably. One rebounded after a government bailout, and the other sustained a serious blow to its brand and reputation. Of course, I’m speaking of General Motors and Toyota. Both have proven that the top of the market-share pedestal is coated with slippery motor oil.

Lately, Volkswagen fell victim to the seductive powers of market share bragging rights. A few years ago, Volkswagen Chairman Martin Winterkorn tied his US sales team to an annual unit goal of 800,000 by 2018, part of an effort to overtake Toyota as the world’s biggest carmaker. And we all know where that effort ended up. Right now, most VW owners don’t care how big VW is. They would rather just recoup the lost resale value on their CO2-spewing diesels.

No doubt that trumpeting feels good, but it’s just marketing fluff—cotton candy for Sales that provides a sugar high – but no protein, no octane, no sales traction – and no clear value for customers and prospects.

Even when market share claims are concrete and verifiable, they fail the so-what test. Remember, your customers aren’t automatically wowed by market share.   They just want value, and not a market-share percentage.