Category: Sales and Marketing

Entrepreneurs spend incredible amounts of time and energy to generate leads and drive traffic to their website. One area that is often overlooked is increasing the value of existing marketing efforts. Think about it: if you wanted to double the number of leads generated from your website you could either double the amount of traffic to the site or double the site’s conversion rate. Which one is easier? Increasing the conversion rate is always easier than increasing traffic. In addition to focusing on the conversion rate, it is also important to take the current marketing efforts and automate ways to improve their value, much like improving the conversion rate.

Here are five simple ways to increase the value of existing marketing efforts:

1. Retargeting – Retargeting allows you to show banner ads on a large number of different sites exclusively to people who have already been on your site (I’m generally against banner advertising with retargeting being the one major exception)
2. RSS Broadcasts – Take an RSS feed of blog posts, press releases, or whatever else you like of yours and have Twitter, Facebook, and LinkedIn automatically updated when each new item is published
3. Newsletter Sign-up Option – Add a sign-up link or text box on your site and encourage people to give their email address to get your newsletter (the contents of the newsletter should be repurposed blog posts)
4. Live Chat – Engage with your site visitors through live chat to answer their questions as well as convert anonymous visitors into identified prospects
5. Company IP Address Lookup – automatically identify companies on your site based on their IP address

Existing marketing efforts are easily augmented and improved with these tactics and more.

What else? What are some other ways to increase the value of existing marketing efforts?

Last week @agraber retweeted an article Inbound Marketing Deception Uncovered that cites a useful example of when inbound marketing doesn’t work. The general idea is that inbound marketing works for replicative businesses but not as much for innovative businesses early in the adoption lifecycle. Put another way, inbound marketing works if people are online actively searching for and talking about your category of product or service. If the category doesn’t have a name yet, or search/conversation volume is too tiny, you won’t see results using inbound marketing.

Inbound marketing is still worth doing in this scenario so as to build up a cache of content and links to be in a strong position when the market grows. For this type of early adopter market, before the chasm has been crossed, the solution is to use outbound marketing including:

• Online advertising
• Email marketing
• Cold calling

Outbound marketing is, and will continue to be, an effective form of marketing, especially for early adopter markets.

What else? What other times does inbound marketing not work?

Marketing is often an after-thought to first-time entrepreneurs when in reality lead gen should be built into the startup’s DNA on day one. With that said, marketing is often more difficult for entrepreneurs because of its delayed gratification nature. You see, when entrepreneurs are on the phone selling or on their MacBooks writing code, there’s immediately feedback — the deal is/isn’t moving forward or the new feature is now in place. With marketing, yes, you can see that blog post that was just written but you likely won’t see results for months. Entrepreneurs are often ADHD and seek out the next shiny object.

The good news is that social media and PPC ads give more immediate results for marketing but that bad news is that marketing is much more involved and takes significant ongoing time and energy. Entrepreneurs need to have a marketing gameplan, and stick to it. Here’s a tactical B2B marketing gameplan:

• Blog Posts: Write three blog posts per week (one thought leadership, one industry commentary, and one varied)
• Twitter/Facebook/LinkedIn: Send at least one tweet/Facebook post/LinkedIn status update per day linking to industry content as well as any new blog posts, events, white papers, etc
• White Papers: Write one new 7-10 page white paper per month with accompanying slide show and make it available on your site, on a landing page, on YouTube, on SideShare.net, and social media
• Press Releases: Write one new press release at least every two months talking about a new release, event, award, etc and publicize it on the wire as well as social media
• User Conferences: Hold one annual user conference to engage with clients, partners, and prospects in person
• Books: Publish a printed trade paperback book about the industry and use it to educate customers, prospects, trade show attendees, and new employees

This tactical marketing gameplan doesn’t have anything groundbreaking but by sticking to it over the course of months and years you’ll see a significant return on investment.

What else? What do you think of this tactical B2B marketing gameplan?

Continuing with yesterday’s post on The Value of a Qualified Lead for a Startup, the next logical question is how to define a lead as qualified. Most leads aren’t qualified, and treating unqualified leads as qualified often results in contention between sales and marketing. At a base, I like to think of it as startup-specific criteria that often incorporate Budget, Authority, Need, and Timeline (BANT).

Here are startup-specific criteria I like to look at when defining a qualified lead:

• Specific job titles or functional responsibilities (usually related to Authority)
• Specific verticals/industries along with number of employees or amount of revenue
• Specific pain points or situations that are present (usually related to Need)
• Ability to make a purchase within a specific period of time (usually Budget and Timeline)

Defining the criteria for a qualified lead, and having everyone in the startup agree on it, results in better communication and results. Instead of pointing to the number of leads generated on a daily/weekly/monthly basis, the metrics should be the number of qualified leads generated in a time period.

What else? How do you define a qualified lead?

Determining the value of a qualified lead is difficult for most companies, especially startups without historical data to draw from. The value of a qualified lead should be approximated early in the life of a startup as it is essential to understanding where to invest money and resources.

Here’s a simple way to think about the value of a qualified lead for a startup:

• Average monthly customer fee (e.g. $500/mo or $6k/yr)
• Times the gross margin of the business (e.g. 70%, so $6k*.7 = $3,200)
• Times the discount for sales salaries, sales commissions, and marketing salaries (e.g. 20%, so $3,200*.8 = $2,560)
• Times the discount for the cost of capital (e.g. 10%, so $2,560*.9 = $2,304)
• Divided by the number of qualified leads needed to close a sale (e.g. 10 leads to close one customer, so $2,304/10 = $230 for a qualified lead)

In reality, you should also take into account the average life of the customer (e.g. 48 months) and factor that into the value of a qualified lead but from a startup efficiency point of view it is best to acquire a customer for less than the first year’s gross margin revenues, and the cost of a lead is only one piece of that equation.

What else? What do you think of this method to calculate the value of a qualified lead for a startup?

Generating quality leads is the main barrier to growth for most B2B startups. As such, startups should start lead generation efforts on day one knowing it takes a significant amount of time to build a customer acquisition machine.

Here are a few things to keep in mind with lead gen efforts on day one:

• Talk with all team members about customer acquisition efforts and reiterate that quality leads are almost always the bottleneck to growth for startups — everyone should get involved
• Plan on a combination of inbound and outbound marketing
• For inbound marketing, publish at least two blog posts per week, one tweet per day, one white paper per month, participate in online community conversations, and plug in an inbound marketing tool
• For outbound marketing, start building a newsletter email list, potential prospect calling list, available sponsorship opportunities (like a community of potential prospects), and plug in a marketing automation tool

Building a customer acquisition machine is the difference between success and failure for many startups. Start focusing on lead on day one and incorporate in into all aspects of the startup.

What else? What other ways do you incorporate lead gen efforts on day one?