“Leads per month” — The most misleading metric in B2B marketing
One of the key goals of Marketing is demand generation and a metric to measure that is leads/month. Correct? Wrong!
However, experience and anecdotal evidence have helped find more meaningful ways of measuring marketing success. And for those B2B marketers out there measuring themselves on leads/month: Forewarned is forearmed.
Take the case of this technology services firm with over a $100 mill in annual revenue.
The Head of marketing shared the metrics tracked over a 9 month period.
# of leads generated — 509
# of sales meetings — 8
# of deals closed — 0
If this company continues marketing operations with these metrics, you know what will eventually happen to their marketing team.
The problem starts with what is measured as a ‘Lead’. “A lead is a prospective customer of a product or service, recognised when an individual or business shows interest and provides contact information.”
So, what’s wrong with this?
There is nothing wrong with the definition, but in the age of content marketing, the problem begins with what is being counted as a ‘Lead’.
What do marketers refer to as a ‘Lead’ in a tech firm? We’ve asked around and the shortest answer is ‘any form fill’. And let’s take a look at the kinds of form fills through this ‘Lead Maturity Model’
People fill a form to download some ebook, some fill a form to send in a specific enquiry and others do may register to attend a webinar. Experience shows that each of these has different probability scores of becoming a future customer.
So, it is futile to measure all under the umbrella of ‘leads’ for the month and report in your monthly metrics. Marketers have responded to this issue through ‘MQLs’ (marketing qualified leads) with ‘lead scores’ such as a higher score for project enquiries and a lower score for a content download. A step in the right direction, but here’s an example of what we encountered.
Right after some intense SEO for a few months on our client’s offering, we received this enquiry that got us super excited.
Look at the enquiry below
Ma…a Systems <sales@m….ga….s.com>
Name: John P……… Email : jpe…..er@in…..ak.com Contact #: 401–474……2
Message : Hello, I have a few domino applications that I need to migrate to a different platform. Please call to discuss.
The prospect’s intent is clear. We quickly checked their website and confirmed they fit our ‘ideal customer profile’ (ICP) and were confident of turning this into an opportunity. Well, it didn’t convert even into a technical meeting. We were puzzled until the inside sales rep informed this after two calls “The enquiry was generated by a trainee. He neither had the ability to make decisions nor had access to leadership team”
This takes us to another dimension of lead generation which we need to consider to know the stage of customer journey in the sales funnel
Fully realising that ‘all leads are not equal’, we looked at 3 critical aspects before we call it as quality lead.
- Type of lead (refers lead maturity model)
- Level of individual
- Account potential
This definition would surely take you closer to your goal of generating and measuring quality leads. Some will quickly recognise the ‘BANT’ model kicks in here. But most often ignored by marketing.
But are we still there?
So far we have only looked at the data, metrics and qualification criteria. Are we missing a stakeholder in this game?
Your sales and inside-sales team!
Because you want to generate quality leads that matter to Sales so that your Sales team can convert those into deals!
For one of our clients, we got the feedback from Sales that leads generated are at lower level roles (managers, developers) whereas they need leads at the leadership level. We then changed the webinar titles, made the content for leadership and started generating CXO level leads down the line. It changes the aim of getting more leads to get better leads.
Feedback from the Sales team in terms of messaging, content, buyer persona, account type etc. becomes critical in the lead generation process and that’s where most of the marketers tend to turn a blind eye.
So, how do you know you are building a healthy lead generation engine?
Try following the below 3 point approach and you will see the change and benefits very quickly
- Commitment to Sales alignment
- Experimentation. An ‘agile’ approach to marketing
- Moving beyond content marketing to engagement marketing
Each of these points deserves a separate blog in itself, but on a closing note, if leads/month is misleading, what could be KPIs that reflect the health of lead generation? We find these useful amongst others.
A. Number and quality of meetings with prospective customers/month (feedback from ‘Inside Sales)
B. The number of opportunities that Sales generates each month
What metrics matter to you?