In today’s world, sales lead management has become increasingly important to all businesses. Signs of an improving economy mean that companies are quickly shifting their operating mantra from cost cutting and containment to revenue growth. This shift is resulting in increased investments in marketing and sales, including new sales lead management and market segmentation processes, and a renewed focus on gaining market share rather than stabilizing it. Companies that execute more effectively than the competition in this environment will grow faster, more profitably, and the individuals responsible for this will receive greater rewards for their efforts.

Revenue is driven by coordinated and focused sales lead management activities that can be measured and continuously improved. For companies to transition from where they’ve been to where they need to be through sales lead management, they must live by two critical truths:

1. Sales lead management is a fundamental business process. It is not a campaign. It should be integrated into everything a company does.

2. It is virtually impossible for a company to execute sales lead management as efficiently and effectively as a business process outsourcer with concentrated domain expertise.

BPO Then and Now
Until recently, the argument for business process outsourcing (BPO) of non-core functions focused on cost reduction and increased efficiency. Today, however, businesses are embracing BPO because to survive and ultimately prosper, they must be able to demonstrate excellence in every discipline. BPO allows companies to offload core and non-core functions to experts in those fields so they can dedicate internal expertise to the business core competencies - a more practical and profitable way to run a business.

Sales lead management is a basic business process, yet companies sometimes treat it like a campaign or project. With budgets as tight as they’ve ever been and the era of accountability here and here to stay businesses are shifting away from events, campaigns and other one-off media and moving toward a mix of media that includes technology-centric, interactive marketing. Specifically, companies are getting the best results from integrated, multi-media direct marketing through market segmentation, market intelligence, message precision and pinpoint deployment of human assets.

Senior executives have just two problems: sales and everything else. So why, then, do companies that readily outsource human resources, accounting, legal, transportation and other functions desperately cling to sales lead management? Previously, companies held onto sales lead management because they believed they could save themselves into prosperity. This philosophy forced managers to make limited investments in difficult-to-measure inside sales programs and market segmentation that routinely failed. To assuage their collective consciences, management convinced itself that the sales people should be doing most of the prospecting, market segmentation, and sales lead management anyway.

Today, while senior management almost uniformly continues to misunderstand how its sales staff should best be used, sales lead management is kept inside because BPO experiences of the past have conditioned executives to maintain control of all core business processes of which sales lead management is one. The reality, however, is that most companies aren’t successful at sales lead management and often confuse this critical business function with marketing and sales, when in fact sales lead management is neither.

Companies have implemented ERP systems, invested in supply chain management, become ISO certified, and trained their employees in six sigma; but there has been little focus, discipline, coordination, measurement or accountability associated with sales lead management, marketing, or sales.

Technologies such as customer relationship management (CRM) and sales force automation (SFA) solutions provide no clear vision for adequate market segmentation or for enabling disparate departments in busy companies to work in concert toward the main objective increasing revenue!

And the inadequacies in today’s sales and marketing departments are only becoming more apparent due to an increasingly dispersed work force, better educated buyers, and increased product transparency due to the Internet and proliferation of analysts such as Gartner, META and AMR.

Five Silver Bullets
There are Five Silver Bullets when it comes to increasing your company’s revenue through sales lead management. Live by them, and you’ll be rewarded with growth and success:

1. Market segmentation and intelligence

2. Defined offer and message delivery through the appropriate media
3. Marketing measurement
4. Identification and leveraging of the sales forces strengths
5. Accountability in sales activity, from pipeline through forecast

Market Segmentation and Intelligence
So you’ve decided that the Fortune 500 is your target market well, that puts you and your staff in the position of confused competition with a bunch of other guys that aren’t using market segmentation. For instance, which industry within the Fortune 500 would you be pursuing: banking, telecommunications, automotive? The Fortune 500 lists only include U.S.-based, public companies what about large private companies? Are you really selling to the Fortune 500, or do you sell or desire to sell to the 3,000-plus companies that are large sub-headquarters, subsidiaries or large divisions of the Fortune 500?

Three sales lead management problems plague companies today in the area of market segmentation and intelligence: failure to accurately profile and define the target; the gap between the market captured and the whole market; and confusion surrounding the mission of CRM (including SFA) versus the mission of developing robust prospect databases and providing a steady pipeline of new business opportunities.

Of all of the sales lead management Silver Bullets, the single most important one is market segmentation and intelligence. The most critical step towards improving your market segmentation and intelligence is rethinking the prospect database. A single, precisely defined prospect database is crucial to the success of your sales and marketing efforts. The ability to communicate your value proposition (in a meaningful way) to these potential prospects, measure their responses, and continue to incubate identified opportunities is equally as important. Yet, companies waste hundreds of thousands of dollars on poorly targeted sales lead management activities that employ little or no market segmentation which they can neither track nor measure.

Defined Offer and Message and Delivery through the Appropriate Media
Messages and offers are testable through market segmentation. Text e-mails and short surveys are powerful ways of taking your prospects temperatures on various issues. Brief surveys can also be used to understand and measure customer interest in new offers such as upgrades, product extensions, training, and maintenance options. Aligning these with sales lead management goals and then converting the survey information into marketing action on the back end is exceedingly complex, often required in real-time, and multimedia in nature.

Single media campaigns waste an enormous amount of money. Millions are squandered on direct mail campaigns that win awards, but little business. Integrated multimedia campaigns should use market segmentation to direct the message toward focused audience groups in order to be most effective. Multiple media (such as e-mail, targeted direct mail - even handwritten notes interspersed with timely telephone calls) will, absolutely, produce the highest return as compared with virtually any other method.

Marketing Measurement
If you’re using a single prospect database for sales lead management, capturing touch and response metrics is relatively simple; however, it takes database marketing expertise, a centralized approach, and discipline in planning, market segmentation, campaign development, and lead handling to substantially increase visibility into results and ROI. For example, a pre-populated prospect database, including event information at the contact level, enhances result reporting, aids in market segmentation, and decreases time to market with successful programs.

Centralized inbound voice and e-mail response handling pay off in two ways. First, careful response handling is a key to the success of any future business relationship. Prompt inquiry handling and fulfillment is considered the first chance to make the best impression. Second, touch and response data can be captured and reported on immediately to further improve and refine market segmentation. This eliminates the inaccurate and time-consuming hit-or-miss process of consolidating information and trying to guess at actual results from weeks- or months-old partial data.

Identifying and Leveraging the Sales Forces Strengths
There are three kinds of sales people: beaters, hunters and farmers. Beaters cant hunt. Hunters don’t like to beat or farm. And farmers think they’re hunters, making them the most dangerous salespeople of all. Carefully assess how you are deploying your team and make sure that you follow the number one rule of sales lead management: send your best rep to the best prospect in the best place at the best time. Notice, this does not say to deploy demographically, by vertical or by any other arbitrary assignment of territories.

There are tell-tale signs that your hunters are actually farmers.

1. Very little new business prospecting and just enough business from current accounts or a few referrals from current accounts to keep their job.

2. Comments, in response to a sales managers questions about the reps sales lead management skills, if I don’t keep on top of my current customers, they will go elsewhere.
3. Farmers actually complain less about having to beat than hunters. They wont do it, but a sure sign that you have a farmer is lack of complaints about beating requirements.
4. A lack of understanding of the steps required to move and track new business or a lack of desire to communicate regarding these steps.

Accountability in Sales Activity from Pipeline Through Forecast
Let’s say your forecast process includes ten steps with 1 equal to an accepted lead and 10 equal to win/loss. Chances are your forecast looks more like a black diamond ski slope than a healthy pipeline with lots of 1s and a handful of 10s but very little visibility into those prospects in stages 2 through 9.

There are psychological reasons for the ski-slope sales lead management syndrome:

1. Sales people hate to lose deals. What they hate even more is losing their jobs. By accepting leads and having to report on each step in the sales process, sales risks that as many as four out of five opportunities will be lost (based on a 20% close rate). This represents an unacceptable level of accountability and risk to a sales person. However, there are ways to overcome this, and it is important that you do. Management’s philosophy regarding win percentages and the reward system for following procedure on leads are two important ways to overcome this pervasive and debilitating problem.

2. Sales people are driven by the three Cs: control, credit and compensation. Having to report simply irritates them, and they feel threatened on all three Cs. The three Cs are responsible for most sales accountability ills.

Given these factors, there is a sales management rule to remember: sales people do what you pay them to do, not what you want them to do. If they close business that has been on the forecast as a 1 (accepted lead) for more than 30 days and there is no other movement noted in the forecast, they should not be paid full commission. Why? Because a sales person who does not forecast accurately does not allow your company to plan resources in support of new client needs. The rule is simple: Record progress, get full commission. Leave us guessing, get partial commission. You choose.
As contentious as this might seem, it is the only process that puts teeth into the pipeline and forecasting aspects of sales lead management.

An Easy Choice
Maintaining the status quo is an option, just not a good one. All companies benefit from substantially reducing soft spending (such as brand and image-oriented spend) and cutting unproductive sales staff. By doing so sooner rather than later, companies can more quickly shift investments to direct and integrated marketing, which produce more substantially increased, predictable and measurable results. Ultimately, following the Five Silver Bullets of sales lead management, from market segmentation to demanding accountability from your sales staff:

1. Creates additional short- and long-term return on investment

2. Allows the 60 - 80 percent of your sales staff worthy of investment to produce 120 - 150% of what would have been produced without such a move with less management time and expense!

Companies cannot save their way to prosperity. You wouldn’t entrust your accounting requirements to your IT staff, nor would you allow your administrative personnel to draft and negotiate contracts. There are simply some critical business functions that are better left to experts. Sales lead management is one of them. Outsourcing this critical role to professional lead generators is a wise decision for several reasons:

• Reduce costs and enable more precise control of operating expenses

• Free capital for other purposes
• Improve focus of company
• Provide qualified staff and management for a difficult business process
• Mitigate risk
• Provide access to world-class sales lead management and market segmentation capabilities

Conclusion
The good news is that by mastering the silver bullets of sales lead management, you can grow faster and more profitably than the competition:

1. Market segmentation and intelligence
   Cleanse, prioritize and profile the real market with market segmentation tools. Acquire incremental qualified prospect entities (ultimate parents, headquarters, subsidiaries and large divisions) to close the gap between what you currently have identified as your market and the real market.
2. Defined offer and message and delivery through the appropriate media
   Create a process that identifies and provides solutions for various phases in the sales lead management cycle. For example, the broadest needs are communications and processes to advance the sale or nurture longer term opportunities.
3. Marketing measurement
   Adequate marketing measurement of campaigns combined with strong database marketing can greatly aid market segmentation and increase ROI.
4. Identification and leveraging of the sales forces strengths
   Most companies have more farmers than hunters. Therefore, sales force segmentation should be employed for the sales team just as market segmentation is used for target marketing. Segmenting sales efforts based on need is the most important first step in fixing this problem.
5. Accountability in sales lead management activity from pipeline through forecast
   Marketing, with help from sales and buy-in from C-level management, defines the target market, the offer and message for each market segmentation, and the media necessary to cost-effectively generate the number of leads required by sales to meet company revenue goals. As a check and balance, the sales force must accept marketing leads in order for marketing to meet its goals. Therefore, marketing cannot simply load the pipeline with low-level leads; they must provide legitimate, closeable leads.

The sales force either accepts or rejects leads on a lead-by-lead basis, and then either converts the leads to sales at a predetermined rate, or not. There is a check and balance equivalent for sales that is as follows: once sales accepts a lead (and lack of feedback is tacit acceptance), marketing’s responsibility for that lead ceases.

The only other requirement is that a judicial branch comprised of senior sales and marketing executives, if not the CEO or President, should fairly assess leads that have been rejected, but appealed by marketing, to ensure that opportunities are not being squandered.

About the Author
Dan McDade is the president and founder of PointClear. Prior to starting PointClear, McDade served as President of UST: The Business Marketing Group and Vice President of Marketing for the direct mail company Jackson & Perkins. McDade has also contributed to M World (the monthly magazine of the American Management Association) and Sell!ng Magazine. PointClear creates business opportunity leads for its clients through comprehensive prospecting, list segmentation, sales lead management, and target market intelligence programs.