Understanding what lead generation is and how it can help you reach your business goals will give you a strong foundation for starting to implement a lead generation plan. Lead generation is the process of referring potential sales leads from strangers, also known as “leads”, to businesses, who will then further develop sales leads into customers.
Lead generation is one of the processes of online marketing. It’s the process when some business or organization attracts new clients’ attention through paid, owned and earned tactics. Lead generation provides a great opportunity to engage prospects at every stage of their decision making process and motivate them to take action
What is lead generation?
Lead generation is the process of generating consumer interest for a product or service with the goal of turning that interest into a sale. In online marketing this typically involves collecting a visitor’s contact information (called a “lead”) via a web form.
Lead generation is a core part of the sales funnel for many B2B companies since their products can cost thousands of dollars and web visitors are less likely to buy their product or service directly from the website. Collecting new leads allows the businesses to educate and nurture prospective customers through email marketing, before reaching out to qualified leads directly via salespeople.
Lead generation is also important for ecommerce and other businesses, as email marketing is still one of the most effective channels for marketing online, and gathering a prospective customer’s contact info allows the business to market to them later, even if they do not make a purchase immediately.
Any person who has an interest in a company’s product or service is considered a lead. Not anyone and everyone is a lead, as people have different preferences and needs. Many businesses make the mistake of marketing to everyone when they should focus on people who are interested in what the company has to offer.
Source: Hubspot
Lead generation can be defined as the process of attracting prospects and converting them into someone who has an interest in your company’s products and services. Modern brands make use of various lead generation strategies such as:
- Blogging
- Email marketing
- Social media marketing
- Networking
- Coupons
- Live events and seminars
- Website landing pages
These are just a few strategies that you can use to attract potential customers to your product or offer. Most companies prefer to stick to what works best for them, as lead generation strategies differ according to industry.
Email and social media marketing for their lead generation might work for online fashion stores, but the same strategies may not work for software companies. People looking for software might require more details and information on the product, which is why a blog or a series of webinars could work better as lead generation tools.
Why is Lead Generation Important for Brands?
When a person shows interest in your brand’s products or services, the steps that person takes towards making their first purchase just seem natural. You just helped them to fulfill a need or solve a problem.
When a person has no interest in what you have to offer, yet you still try to convince them to make a purchase, they may feel like they are being pushed to spend their money. This can make the customer feel like they were forced to buy your product and it can hurt your brand’s reputation.
Attending to your target audience only through lead generation can ensure that your brand is ideally matched with the right customers. More benefits of lead generation include:
- Target the right customers – Companies can focus their resources on targeting specific markets, which in turn will save money and increases sales (improved ROI).
- Increased awareness – Lead generation can also build brand awareness and reputation. When people discover your brand, you will be able to supply them with more information regarding product features and benefits.
- Opportunity to collect valuable prospect information – Lead generation has the potential to gather important marketing information from prospects. Customer information such as needs wants, and preferences can assist you in tailoring your product or service to suit your customers’ needs. Eg. Companies can obtain this information through registration forms.
- Brand Loyalty – Companies can build larger communities of like-minded customers, which can, in turn, improve customer loyalty.
Most marketing departments measure lead quantity when determining a successful lead generation campaign. Sales teams, on the other hand, focus on lead quality. Leads with a clear intent to purchase your product, have the finances and means to do so, and meet the parameters set by you are considered as quality leads.
If a company focuses on lead quality, the chances of converting a lead into a customer drastically increase. Having higher conversion rates will allow you to confidently invest in your quality leads, increasing your return on investment (ROI).
Source: Ascend2
Focusing on quality leads can potentially increase the rate of new customer acquisition. Getting new customers at a high rate will allow you to quickly grow a loyal customer base. This can also improve your ROI in the long term, as the faster you build your customer base, the sooner you will be able to retarget new and existing customers.
As mentioned above, focusing on quality leads can drastically improve conversion rates and ROI. However, there are a few drawbacks to quality leads. For instance, a sales team that focuses solely on their quality leads can end up neglecting their other duties such as after sales calls or product deliveries.
Investing time and money into quality leads is still a risk that salespeople will have to take. A quality lead can still back out at the very last moment. You won’t just lose the deal, but you would have lost all that time and effort that went into convincing the lead to purchase your product.
Lead quality is usually determined after going through a list of leads that were acquired through a lead generation campaign. Most campaigns will focus on lead quantity. So marketers and sales teams will still have to go through all leads to determine their quality leads.
Lead Quality Pros
- Improved conversion rates
- Improved ROI
- Can be outsourced
- Higher customer satisfaction when matching your product with a target customer
Lead Quality Cons
- Can be time-consuming and distracting for the sales team
- If outsourced, the company generating the leads might not have sufficient product knowledge
- Quality leads are still considered a risk as they can back out of deals
How to Attract Quality Leads?
B2B marketers claim that they generate leads from the following social networks:
- 39% of B2B marketers say they generated leads from Facebook
- 30% of B2B marketers say they generated leads from Twitter
- 44% of B2B marketers say they generated leads from Linkedin
Finding quality leads on social media is a reality. However, it is important that you select the platform that best suits your industry. LinkedIn is the social network that generates the most B2B leads. It makes sense to start here as the platform is built for business owners and professionals who wish to connect with each other.
How lead generation works
There are two main components to the lead generation process: getting traffic to your site and then convincing them to share their contact information with you.
The first step of the process is finding an effective way to attract prospects to your website. Depending on your company’s goals and budgetary constraints, there are many ways to start attracting prospects to your site. The following are some of the key ways businesses use to drive traffic:
- Search Engine Marketing (SEM) – SEM is a form of online advertising that involves paying search engines (such as Google or Bing) to display ads in their search results. Because search is the primary way people navigate the web, this can be a big source of traffic.
- Search Engine Optimization (SEO) – Search engine optimization is similar to SEM, in that it involves getting traffic from search engines, but rather than paying search engines for ads, SEO involves optimizing your website for search engine algorithms so that it appears higher in the organic search results.
- Social Media – Social media sites such as Facebook and LinkedIn have grown to become some of the most popular sites on the web, and are beginning to rival search as major sources of traffic. You can drive traffic from social networks by posting content to social media platforms or paying for ads that run on the networks.
- Display Ads – This type of advertising comes in various forms such as video, image, audio or text. These ads can be purchased on relevant websites in order to drive that traffic to your own site, usually via Pay-Per-Click (PPC) models.
- Offline Events – Online marketing can often begin offline. Events such as industry conferences and meetups can be good ways to network with potential new customers, inform them about your brand, and get them to your website. These can be events that you attend as a guest, events that you sponsor or events that you host yourself.
Once visitors start arriving to your site, the next step is to convert them into leads via an online form. This can be done in using many different lead generation tactics but involves getting users interested in your product or service and getting them to submit their contact info, often through the use of an incentive (known as a “lead magnet”).
Here are common marketing strategies businesses leverage to generate leads:
- Content – Providing high-quality content in exchange for contact information is a common practice in lead generation. This content can be anything from a white paper, case study or infographic to an ebook or exclusive video. The idea is to entice potential customers in your target audience with a piece of content that is relevant to your business and require them to provide their contact info before they can get access to the content.
- Webinars – A webinar is a live video session that your visitors can view and participate in. Webinars typically last between half an hour to an hour and provide information and educational material about a specific topic. Because webinars are interactive and require a big investment in time, they can be a great way to not only create a lead but also to educate and convert them.
- Landing Pages – The best lead generation tool of all is your product. If you have a compelling product that solves a major pain point, visitors will want to provide their contact information even without any incentives. Presenting your product in the most attractive way is often done through landing pages or sales pages, which help educate and convert prospective customers. Landing page optimization is the key to making sure you are getting the most out of these pages.
Once a lead is created, if the customer is in the target market, the lead becomes a Marketing Qualified Lead (MQL) and the digital marketing team will begin nurturing the lead via marketing campaigns. This nurturing process typically involves marketing automation campaigns to specific email lists to follow-up with content that helps to educate and persuade the prospects to eventually mature into sales leads.
After a lead has been nurtured, a prospect can be convinced to make an inbound purchase on the website or by reaching out to a salesperson, turning them into a sales qualified lead. In enterprise sales, it is often the sales team that reaches out to the prospect to close the deal.
How to improve your lead generation
Aside from driving more traffic to your site, there are many ways in which you can optimize your website in order to drive more leads.
Since content is often a key incentive for driving leads, experiment with different pieces of content, call-to-action placement and lead magnets to determine what type of content performs best. This typically involves identifying your key buyer personas, and creating content that would be compelling and useful to drive quality leads.
Beyond incentives, often a key part of the conversion funnel that can be optimized is the lead form. Although it is beneficial from a business standpoint to collect as much information as possible about a prospect, more form fields lead to a reduction in form submissions. Experiment with different form lengths to see what is optimal in terms of lead capture and lead information.
There are many other aspects of a site that can be optimized as well, from having a clear call-to-action to making the site distraction free and easy to navigate so that users can easily get to the content that you want them to. Exploring the data in an analytics platform can be helpful to visualize how potential leads are navigating around your site. For more lead generation inspiration, see our post on 50 B2B lead generation ideas.
How to use A/B testing to improve lead generation
Although there are many elements of your site that can be improved, you don’t want to just implement them all at once and hope for the best. That’s where A/B testing comes in.
A/B testing allows you to test out different changes on your site to segments of your traffic in order to determine whether they have a positive impact on your conversion rate on not, and what the impact will actually be. Testing allows you to make data-driven decisions about changes to your site, rather than just going with your gut.
Whether you are making changes to your lead forms or testing out different lead magnets, A/B testing software such as Optimizely makes it easy to show different versions of your site to your visitors, so that you can determine which version performs the best.
CONCLUSION
Lead generation is more than just the creation of sales leads – it’s the general term for an organization’s process of converting its marketing assets into leads. It involves taking information – generated from advertising campaigns, newsletters, websites and so on – and giving that information to people who might be interested in your product or service.
Good leads are prospects that have an interest in your product or service and are in the market to make a purchase. These high-quality leads can assist companies in boosting sales and ROI. However, many companies still choose to go for quantity over quality when it comes to leads.
With the introduction of modern marketing tools, software, and social media platforms, marketers are able to fine-tune their skills in acquiring high-quality leads. The main challenge lies in determining which of your leads is of high quality and ready to buy.