planning essentials

Destroying Lead-Generation Myths

If you’re thinking about proactive lead generation, your first step should be to re-examine your firm’s thinking about what works and doesn’t work, say Mike Schultz and John Doerr, co-Presidents of service marketing firm the Wellesley Hills Group. The two have identified five common lead-generation misconceptions. Breaking down these myths can lead to more better ROI for your marketing time and dollars.

• Myth #1: “Websites don’t affect lead generation”—Often we hear that, “we have a Website up because we have to have a Web presence, but our Website has no effect on whether we attract or win new clients,” Schultz relates. At a recent seminar of 40 business owners led by the team, Schultz asked, “When you’re buying something for your business, do you, at some point in the buying process, visit the Website of the vendor firm?” All the hands in the room went up. Then he asked, “Who isn’t at least somewhat influenced by what you find there?” All hands went down. Websites affected the buying patterns of 100% of this group, and affect at least 50% of the attendees’ decisions to become sales leads for another company. Let’s put this misconception to bed right now. Also, a Website can generate leads from search engines, registrations for events and seminars and can also act as a communication channel between a firm and its prospects.


• Myth #2: “Don’t market to current clients”—“We have about 5,000 target companies for this service. About 1,000 are already our clients, so we should focus our lead generation campaign on the other 4,000.” Sure, you want to bring the other 4,000 companies into your fold and make them your clients. But if you’re looking to generate maximum response from your lead generation campaigns, and maximum revenue for your investment, don’t ignore your current clients. First, a current or former customer, assuming they’re relatively satisfied with your services, is an order-of-magnitude more likely to respond favorably to your lead generation campaigns than non-customer companies. Second, your competitors want to get to your customers (and they’re trying), and other companies are vying for their attention. If your clients are not focusing on your messages and value, they’re focusing on someone else’s.


• Myth #3: “We need more brand recognition first”—Instead of spending dollars on ‘brand recognition’ to prime the pump for the lead generation you’ll do in the coming months, why not just start with directly generating the leads? For every well-known brand there are dozens of firms that most people have never heard of. Yet, they find clients and do well. Name recognition doesn’t hurt, but for the most part name recognition building should be a byproduct of something else like lead-generation campaigns, PR and publishing, events and speaking or word-of-mouth about your services. In the end, regardless of your brand recognition, what you need to do in order to fill the front end of your sales pipeline is develop a compelling value proposition and then find qualified prospects. If brand recognition is the goal in-and-of-itself you’ll end up spending a lot of money with little return.


• Myth #4: “We need to run some magazine ads”—Many firms run ads in business journals and trade magazines with eager anticipation. They’re proud of their ads’ creative design, copy and message. More often than not, however, they’re disappointed with the ROI from advertising, says Doerr. “Magazine ads are a waste of money for most companies,” he adds. “As a lead-generation vehicle, magazine advertising should be on the bottom of your list.”
           While magazine ads may not work, targeted marketing using such vehicles as online and print directories, like yellow pages, is a proven lead-generation strategy (according to a recent study by consumer research firm Knowledge Networks, The Y Advantage: Landscape 2008, 94% of consumers have used print yellow pages, and 51% have used online yellow pages).


• Myth #5: “Direct mail doesn’t work”—Schultz notes that 40 out of 40 attendees at a seminar at which he presented indicated that they visited Websites before purchasing new products and services. He also asked how many of them were attending the seminar based on the direct mail invitation Wellesley Hills sent them. About 20 raised their hands. Another 30% registered for the event through their Website and 80% of attendees had never heard of their firm before attending the event. There are a thousand ways to fail with direct mail. Yet, much like cold calling, direct mail can be a major vehicle for service lead generation success.

“If you want to have above average success with lead generation, you first have to squelch the misconceptions that will keep you from moving in the right direction,” Schultz says. “By doing so, you can take advantage of tactics that everyone else mistakenly writes off, and you’ll be all alone out front generating the leads your competition is missing.”