Multi-Cycle Nurture Processes - Triple the Return on Marketing Investments
Nurturing is essential for successful lead generation—both inbound and outbound. In fact, I propose that nurturing is the most underutilized activity at a marketer’s disposal. Additional touches using the phone, voicemail and email—across multiple cycles is well worth the time and expense. In fact, nurturing programs increase the lead rate significantly:
Standard B2B lead-generation programs produce an average 5% lead rate.
Advanced B2B lead-generation programs (which includes nurturing) produce an average 15% lead rate—three times higher.
Before we get into the details, note that there are four groups of prospects that require nurturing:
1. Leads: Many companies let leads that are not worked effectively to a closed won or loss disposition disappear into a black hole called CRM. Leads that do not progress need to be returned to the nurture pool to be reworked, eventually reconverted into leads and sent back to the sales force to work. Note that a Lead could ping-pong between a Lead status and Nurture status multiple times over multiple quarters – some of the best opportunities are nurtured over long periods of time.
2. Pipeline. These are prospects with a specific planned next step to be taken within a reasonable time-frame (six weeks to three months). Reasons for this status include, but are not limited to, other project priorities, closing the books, personnel changes, acquisition or divestiture…
3. Nurture Opportunities. These are fully qualified prospect companies that are not immediately interested. While often dismissed, these are important outcomes that require additional work. Each of these future opportunities should be tracked based on changes in the pain, priority, process and environment situation in each.
4. No Response. These are prospects that we have not reached (after a full touch-cycle) and we consider them to be past the point of diminishing return on the current touch cycle. After re-segmentation, many of these prospects will be added to future touch cycles and perform better than a “cold” list.
I have an example of how these nurture groups should be managed to create cost effective long-term value. We have had the good fortune to work with several clients for 10 – 20 years. One of those clients credited our team with finding leads that allowed them to grow 45% compound annual growth rate for five years in a row. We were their partner of the year for most of the years we worked with them. That client was acquired after 10 years of working with us. As an aside, the good news is that we were hired by the acquiring company AND we continue to do work with many folks on that team as they left the acquiring company and went on to do other things.
The following is an example of the disposition history of a lead we created for the acquired IT outsourcing company during our 10-year run with them:
Year 1, Quarter 3, Touch Cycle 1: No Response (the touch cycle had nine average touches – six dials, three voicemails (a dial and voicemail count as one touch) and three emails.
Year 1, Quarter 4, Touch Cycle 2: No Response
Year 2, Quarter 1, Touch Cycle 3: Nurture. Not interested (no history with or interest in outsourcing)
Year 2, Quarter 3, Touch Cycle 4: Nurture. (No change)
Year 3, Quarter 1, Touch Cycle 5: Pipeline. Call back after April 15th
Year 3, Quarter 2, Touch Cycle 6: Pipeline. Management changes eminent. May be open to outsourcing
Year 3, Quarter 2, Touch Cycle 7: Lead. Documentation and digital audio files sent to sales via CRM.
Year 3, Quarter 3, Touch cycle 8: Closed Won. $100,000 per month recurring revenue for a three-year contract.
In this case, new management was open to outsourcing and was unhappy with IT using network infrastructure management as an excuse for not being able to complete strategic projects on time.
In another situation, a company we had been calling was divested and scrambling for coverage provided by their previous owner. They had no infrastructure to handle IT support and they closed within a couple of months.
In another situation, a huge architecture firm in the Southwest had a disgruntled employee who destroyed $30 million worth of design work. This went from No Response to a Lead fast! Our client was able to help them recover all the lost work.
The following summarizes the benefit of multi-cycle nurturing:
Standard Vs. Advanced Lead Generation Practices
Nurturing is staying in front of your prospects as they experience ebbs and flow in their buying cycles.
[FILL IN THE BLANK] % of the Sales Process is Complete before Sales Needs to Get Involved
We have all heard that 57%, 65%, 70% and even 90% of the buying cycle is completed before buyers are interested in talking to buyers. The premise is that there is so much information available online that salespeople are not essential to the process in the early stages of a buying process. According to one of my favorite quotes from ITSMA’s Julie Schwartz: “ITSMA’s data says that for high consideration technology solutions, this is a myth. In fact, we believe just the opposite: 70% of B2B technology solution buyers want to engage with sales reps before they identify their short list.” She goes on to say, “In fact, buyers perceive value in interacting with sales at every stage of the buying process—even the early stages.” Net, net. Get in front of the process and stay with it via nurturing prospects. Be persistent and professional. Buyers value that most.
Why do you think most organizations don’t see the value of nurturing? What sort of impact could effective nurturing have on your sales activity? Could it reduce your expense?
Account Based Marketing (ABM) and Nurturing
ABM has been compared to fishing with a spear instead of a net. The right prospects are targeted, and you don’t end up with a net full of fish you don’t want. Without nurturing, ABM produces substantially less benefit than with it. Long live ABM. Long live nurturing. Don’t let ABM live without nurturing. The thing that has me most excited about ABM is that is intuitive and that it is heavily dependent on the value of nurturing.
Before I circle back around to nurturing and close this out, though, let hear from some experts talking about ABM (and nurturing):
First, from Matt Heinz, president of Heinz Marketing: “I see ABM as a response to inbound marketing. Inbound is great, but you don’t have control over quantity and quality. You also can’t afford to wait until those named account targets happen to find your content and download something.”
I add that you can’t afford to leave it up to the sales force to call quality leads one time, assume they must have been bad leads and let them disappear into the dark hole called CRM. Remember, nurturing TRIPLES the return on marketing and sales expenditures.
Now, my favorite source for ABM data for many reasons, Engagio (from “The Clear & Complete Guide to Account Based Marketing): “Demand generation is, at its best, largely an inbound operation — publishing content that brings a wide range of prospects into your funnel.
“With ABM, you don’t wait for target accounts to turn up in your lead nurturing system, you reach out to your target accounts directly. This is predominantly an outbound strategy, with an extended set of tactics — including account-specific advertising, sales development, and direct mail.
“The rise of marketing automation and lead nurturing has brought sales and marketing closer together than ever before. A more disciplined approach to pipeline management has earned marketing the respect of colleagues in sales. And, new levels of transparency have made marketing more aware of the real challenges the sales force faces.”
I add that not every senior executive wants to be treated like the human equivalent of a pinball, getting your attention only after it has hit the most bumpers and scored enough points. How many times do we have to be burned to understand that never will it be possible to put email addresses in one end of a black box and get great leads out of the other end?
Not all prospects are created equally. The largest, best most likely to convert prospects should never see the inside of a marketing automation meat grinder. Future revenue is leaking out of your CRM daily. I can help eliminate the leaks if you want to preserve revenue. Let me know when you want to talk. Email me at dan.mcdade@prospect-experience.com