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Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
Lead Process + Six Sigma = Increase in marketing Productivity
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Lead Process + Six Sigma = Increase in marketing Productivity

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  • How many problems can you imagine here? Unclear process Unclear ownership Few metrics Little linkage between standards and what is measured Poor tracking No ratios to suggest where the process is broken
  • I like the comment I occasionally hear on NPR from a little music bit called Composers Datebook – Reminding you that all music was once new! Weren’t all orders originally inquiries? How many problems can we see here? Low yield Low process capability Probably unclear ownership Few metrics No tracking and trending
  • This whole area of qualification against a list of standards is a very obvious fit for Decision Matrix tools. Using the brainstorming process, a team can isolate the critical attributes of an inquiry that are important to it being considered a lead. Once the attributes are determined, then another discussion ensues about the weight each variable should have. This is critical to the functioning of this tool as an objective test of an inquiry’s potential value. Once attributes and their weight are determined, then a scale for voting needs to be determined. The voting techniques we have used involve a 9, 6, 3, 1, 0 scale or 9, 5, 1, 0 which I prefer. Discussing and finally agreeing on what a 9 means is also vital to the outcome of the tool If everyone understands that a ‘6’ vote means at least 80% fit, then the voting will likely be valid in assessing the value of an inquiry. If everyone’s assessment of a ‘3’ is different than the voting of course won’t be as helpful. Budget of course lends itself to dollar ranges, authority to a 9 = sole decsion-maker, 6 = decision-maker after other approve, 3= others approve, and 1 = unknown, 0=no authority. Need definitions have to be agreed upon; size could be sales revenue, # plants or applications for your product, etc. Industry – you could define which target industries are best potential for products, and then define downward from there. It’s a process that will take time, but it will only have to be done once.
  • Can’t add much to John’s discussion of metrics. Pretty good stuff. Just make sure we get the right metrics
  • Transcript

    • 1. Lead Process + Six Sigma= Increase in Marketing Productivity John M. Coe Sales & Marketing Institute A. Charles Clark + Impact, LLC
    • 2. The Sales & Marketing Institute
      • Develop and deliver content on B2B sales and marketing
        • Consulting
        • Education/training
        • Publications
          • “ The Fundamentals of Business-to-Business Sales & Marketing” from McGraw-Hill
          • White papers on web-site: B2BMarketing.com
      • I’ve been on both sides of the sales lead process
        • 15 years sales and sales management
        • 20 years marketing communications
    • 3. + Impact, LLC
      • 6 Sigma implementations / marketing & sales effectiveness :
        • Coaching & Consulting
        • Training
        • 3 Sigma for Sales / Marketing
      • I too have been on both sides of the sales lead process
        • 6 years -- sales and marketing
        • 13 years -- sales & marketing services – training, database design, call center mgt., inquiry fulfillment, web site development, advertising agency oversight, tech. documents
        • 5 years – raw materials purchasing
        • 3 years – Certified BB – sales, marketing, Cust service
          • 7 completed projects -- partner on 3 others
    • 4. So What’s the Problem?
      • B2B benchmarking studies show that for every 100 inquiries only 1-3 sales result – typical ratios:
        • 100 inquiries (from all sources)
        • 10-15 qualified sales leads at best
        • 1-3 sales
      • Yet, 90% of marketing budgets are spent with the primary goal of “lead generation” – not a great result
      • Cost of sales lead is higher than recognized
        • Average cost per inquiry is $200
        • Average cost per lead is $2,000+
    • 5. Management is hot on this trail
      • In 2004 73% of Chief Marketing Officers said that business development (lead process) was their # 1 priority to tackle for 2005
      • In 2005 Forrester Research surveyed B2B marketing executives on their top challenges
        • 56% reported “generating more leads”
        • 52% reported “improving lead quality”
      • Senior executives are demanding ROI/ROE measurement of marketing expenditures
    • 6. How to improve lead results?
      • Primary instinct of most marketers is to
        • Develop additional and/or improve current demand generation campaigns
        • Fire the old agency – hire a new one
      • But, the over-looked marketing problem is
        • Improving the lead process to deliver more qualified leads from the current inquiries
        • Agencies don’t do this – you do!
      • Therefore this session is about fixing the lead process first before jamming more inquiries into a broken system – a classic six-sigma application
    • 7.
      • What do you suppose CMO’s are suggesting for business development?
        • Work smarter, not harder!
        • We need to target the audience better!
        • Switch spending to better lead tactics!
        • Sales needs to do a better job of follow-up!
        • Get on the agency to create better advertising!
        • Sales needs to do a better job of follow-up!
        • (_____[ insert your company’s favorite mgt.bromides ] ___)
      • How do you change results without looking at the process that produces them?
      “fixing” the lead process 6 
    • 8. “fixing” the lead process 6 
      • Detail the defect – what, when, where, how many, how often.
      • Capture the voice of the customer / partner
      • Determine relationships Y = f (x 1 x 2 x 3 x x )
      • Map the process – output standards – metrics
      • Identify process ownership, process operators, stakeholders & key internal partners.
      • Fix the root cause – the critical “Xs”
      • Institute improvement plans that sustain gains
      Establish a process mind-set!
    • 9. The Goals of Our Session
      • To detail the seven-step B2B sales lead process and the common mistakes that are made by companies that sub-optimize results
      • To suggest how six-sigma tools and methods can drive significant productivity improvements when used intelligently – when adapted to a people intensive world. People are not machines!
    • 10. 1. Demand/Inquiry Generation
      • Process
        • A variety of marketing communication tactics are deployed to drive responses from a targeted audience.
        • Most common tactics include:
          • Advertising – all media
          • Web based – all forms
          • Direct mail
          • Telemarketing
          • Trade shows
    • 11. Traditional Measures
      • Cost per thousand
        • A measure to know so that different media within the same tactic (e.g. advertising) can be compared.
        • CPM is not a number to be reduced – just know it
      • Response rate
        • The percentage of inquiries received and is mostly driven by the “offer” – there are 3 basic types of offers
      • Cost per inquiry
        • The cost per response of each media
    • 12. Number of leads per 100 inquiries (a typical ratio) Tele- marketing Trade Show Mail or email PR Adv. Offer accepted Outbound media 5-10 3-5 2-3 1-2 For More Information 10-25 10-20 5-10 3-5 Soft offer “ free” 25-40 15-25 10-15 5-10 Information of value offer 50-70 30-50 20-30 10-20 Hard or closing offer
    • 13.
      • Process
        • A variety of marketing communication tactics are deployed to drive responses from a targeted audience.
        • Most common tactics include:
          • Advertising – all media
          • Web based – all forms
          • Direct mail
          • Telemarketing
          • Trade shows
      Demand generation 6  Process mapped? Standards linked to VOC? Clear ownership? Actionable metrics? Frequent reporting? Stakeholders / allies linked? Sigma level? Measurements by tactic? Measurements by audience? Variation declining? Trends tracked? reported? Confidence in data? Ratios / rankings / ratings?
    • 14. 2. Response Handling
      • Process
        • The fulfillment to the request or offer made in the initial marketing communications
      • Measures
        • Speed of response
        • Accuracy of response
    • 15. Inquiry/Response Handling
      • Frequently, this step is viewed as just a fulfillment process or cost and not important
      • Therefore, it’s often done poorly – 2002 study
        • 60.7% of all B2B inquiries went unanswered
        • Average of 10 days to respond
      • If designed properly the response process “sets up” the ability to improve the entire lead system
        • Points you in the right direction at the start
        • Tells the prospect that you’re “good”
    • 16. Discriminate Between Inquiries
      • Develop a profile or “sweet spot” of the best potential leads
        • Industry code – SIC or NAICS
        • Size of company – employee size/revenue
        • The profile can be drawn from a customer profiling process – frequently not done
      • Match the inquiries to one of the large public databases, enhance with these two data points to determine if they hit the “sweet spot”
    • 17.
      • Frequently, this step is viewed as just a fulfillment process or cost and not important
      • Therefore, it’s often done poorly – 2002 study
        • 60.7% of all B2B inquiries went unanswered
        • Average of 10 days to respond
      • If designed properly the response process “sets up” the ability to improve the entire lead system
        • Points you in the right direction at the start
        • Tells the prospect that you’re “good”
      Response Handling 6  I wonder how they treat orders? Where shall we start? Say what?
    • 18.
      • Frequently, this step is viewed as just a fulfillment process or cost and not important
      • Therefore, it’s often done poorly – 2002 study
        • 60.7% of all B2B inquiries went unanswered
        • Average of 10 days to respond
      • If designed properly the response process “sets up” the ability to improve the entire lead system
        • Points you in the right direction at the start
        • Tells the prospect that you’re “good”
      Response Handling 6 
    • 19. 3. Lead Qualification
      • Process
        • The qualification of the inquiry to see if it meets the pre-set criteria of a sales lead.
      • Measures
        • The number of leads qualified per inquires received
          • Leads ready for sales
          • Leads that need development
          • Inquiries that are not qualified – mailing list
          • Inquiries that are not “on-target” - discard
        • The scoring of the lead against the qualification criteria
    • 20. How can this be used?
      • Allows for the discrimination of resources to follow up inquiries – do not chase all inquiries the same, as they are not all equal
      • The goal of the first process is to separate the inquiries into one of the following categories
      • Average breakdown for every 100 inquiries
        • Leads today 10 - 15
        • Leads tomorrow 20 - 40
        • Not qualified 20 – 30
        • Not interested 30 - 40
        • Other (competition) 20 - 30
    • 21. Common Criteria
      • Qualified lead
        • Need/problem that the product or service fits and/or solves
        • Budget/capacity to purchase (could depend on profile of best lead)
        • Authority level/involvement of the contact(s) needed for a purchase
      • Sales opportunity
        • Timing of the purchase that aligns with the sales staff’s window, plus the contact’s desire to move forward in their buying process
    • 22. Lead Qualification
      • What defines a lead for your company?
        • Do not ever call inquiries leads!
      • The terms that must be defined and agreed to by all concerned – specifically sales
        • Inquiry
        • Qualified lead
        • Sales opportunity
      • Sales people are already jaded – they will say “most leads are crappy!” or “not worth the paper they are written upon”
    • 23. Lead Accelerators
      • If the inquiry arrives by mail or phone be sure to respond within 24-48 hours
        • If possible, notify the inquirer by phone or email that the response is on the way
      • If the inquiry arrives by e-mail respond in less than 4 hours or it will negatively effect brand image!
      • Always give the inquirer a reason to respond again and an individual to respond to (not the sales person)
    • 24.
      • pre-set criteria of a sales lead
      • Measures
      • scoring of the lead against the qualification criteria
      • not chase all inquiries the same, as they are not all equal
      • separate the inquiries by categories
      • Decision criteria – agree on definitions, weightings, etc. ahead of time – argue about the criteria and process, not the output of the tool.
      • The terms that must be defined and agreed to by all concerned – specifically sales
        • Inquiry
        • Qualified lead
        • Sales opportunity
      • Lead Accelerators
      Lead Qualification 6  Some key words & phrases mentioned.
    • 25.
      • pre-set criteria of a sales lead
      • Measures
      • scoring of the lead against the qualification criteria
      • not chase all inquiries the same, as they are not all equal
      • separate the inquiries by categories
      Lead Qualification 6  Decision Criteria Matrix Agree on definitions & weightings Argue about criteria and process, not about the output of the tool Budget Authority Need Timing Size Industry Qualification Criteria 9 10 9 7 9 10 Inquiry 1 6 9 3 6 9 1 304 Inquiry 2 9 1 9 9 9 6 376 Inquiry 3 3 9 9 6 1 6 309 Inquiry 4 1 9 9 6 9 3 333 Inquiry 5 9 9 6 9 9 1 379 Inquiry n th Qualification Criteria
    • 26. 4. Lead Development
      • Process
        • A continual process that “works” the lead until it reaches the pre-set qualification criteria for a sales lead
      • Measures
        • The number of leads developed
        • The cost of the each “developed” lead
    • 27. Lead Development/Nurturing
      • Two studies by Penton and Reed Business (Cahners) have shown that from 30-50% of all B2B inquiries bought the product or service they inquired about within an 18-24 month period from time of inquiry.
      • What is your conversion rate?
        • The best seen is about 10% of inquiries to sales, and that was in a demand generation program that started with a very “hard offer”.
    • 28. Reasons for Low Conversion
      • No lead process in place – inquiry distribution is not a lead process
      • Lead qualification is not rigorous enough to separate lower level or warm leads from “hot leads” or real sales opportunities – only sales opportunities should be sent to sales. They will not act or discard the rest.
      • Even if a lead is “qualified” on the score card, but lacks the “timing” criteria, sales will not likely follow up with dedication and convert it.
    • 29. A Sales Perspective
      • As a planning assumption, all sales people have been involved in “lead” systems where they have gotten unqualified leads – they are already highly skeptical and need proof to change their perception and behavior!
      • Any lead system must align with the sales compensation system.
      • On average sales people will use 10% of their time on leads – unforced and without any incentive
        • At 3 calls per day this works out to 60 lead calls per year or 5 per month or about 1 per week!
    • 30. Lead Development
      • First, be sure that a common and accepted definition exists between marketing and sales on what is a “sales opportunity”.
      • Once this definition has been reached, only pass “sales opportunities” to sales. Feedback systems will automatically improve if this is done.
      • Do not keep secret or hide from view those inquiries that have not been qualified and/or the leads that are still being worked on by marketing.
    • 31. Lead Development
      • Depending on the lead qualification criteria, those leads remaining to be “developed” do not meet the “cut level” in one or more of the criteria.
      • Quick review of BANT – Note: these classic lead criteria are not necessarily in the order of when the criteria can be assessed or is known by buyer.
        • Budget
        • Authority
        • Need
        • Timing*
    • 32. Lead Development
      • The job of marketing is to stay with the lead until it is a sales opportunity, and either move it along or know when the “lead” is now a sales opportunity.
        • The buyer may move at their own pace and in this case you just need to be aware of when they are ready for a sales effort/call.
      • This requires a dedicated and, at times, a complex process that is worthy of a dedicated staff/assigned responsibility and budget.
    • 33.
      • 30-50% of all B2B inquiries bought the product or service they inquired about within an 18-24 month period from time of inquiry.
      • A continual process that “works” the lead until it reaches the pre-set qualification criteria for a sales lead – gets to the outcome?
      • conversion rate?
        • The best I’ve seen is about 10% of inquiries separate the inquiries by categories Let’s hope that rate is considered “defective”
      • Lead qualification is not rigorous enough Discipline is always a challenge!
      • lead system must align with the sales compensation system
      • common and accepted definition exists between marketing and sales on what is a “sales opportunity
      • marketing is to stay with the lead until it is a sales opportunity
      Lead Development 6  More key words & phrases mentioned.
    • 34.
      • 30-50% of all B2B inquiries bought the product or service they inquired about within an 18-24 month period from time of inquiry.
      • A continual process that “works” the lead until it reaches the pre-set qualification criteria for a sales lead
      • conversion rate?
        • The best I’ve seen is about 10% of inquiries separate the inquiries by categories
      • Lead qualification is not rigorous enough
      • lead system must align with the sales compensation system
      • common and accepted definition exists between marketing and sales on what is a “sales opportunity
      • marketing is to stay with the lead until it is a sales opportunity
      Lead Development 6 
      • Some Sigma truths that apply:
      • Process mind-set is vital to achieving “break-through” results from problem-solving efforts
      • Process discipline (rigor) is paramount to process outcomes meeting expectations. CHANGE MGT. plans can not be ignored or shorted.
      • Processes are not usually independent of the impact of other processes – look for interfaces and linkages – complete the total picture! Usually a process input is someone else’s process output– beware of losses in the “white space” between processes or procedural steps.
      • Who is the owner of the process? Who cares most about the output?
    • 35. Lead Development 6 
    • 36. 5. Hand-off to Sales
      • Process
        • Distributing the lead/sales opportunity to the sales force or distributor network
      • Measures
        • Number of sales opportunities actively engaged/accepted by sales
        • Number of days taken to engage
        • Prospect satisfaction with follow-up promised
    • 37. Hand-off to Sales 6 
      • Process
        • Distributing the lead/sales opportunity to the sales force or distributor network
      • Measures
        • Number of sales opportunities actively engaged or accepted by sales
        • Number of days taken to engage
        • Even though they may want more leads, the actual capacity and desire is less than represented
      More key words & phrases mentioned.
    • 38. Hand-off to Sales 6 
      • Process
        • Distributing the lead/sales opportunity to the sales force or distributor network
      • Measures
        • Number of sales opportunities actively engaged or accepted by sales Key metric?
        • Number of days taken to engage Another key metric? How do you measure it? When? Where? Who?
        • Even though they may want more leads, the actual capacity and desire is less than represented
      Classic challenge of processes and hand-off points. Root cause? Why? Why? Why? Why? Why?
    • 39. Hand-off to Sales 6 
    • 40. 6. Sales Conversion & Feedback
      • Process
        • Sales calls/effort to convert the opportunity to a customer
        • Providing feedback to marketing on the result achieved
      • Measure
        • Speed and completeness of feedback
        • Revenue obtained – sale, yearly, LTV
        • Cost of the sale
    • 41. Obtaining Feedback From Sales
      • Most comments from marketing people are as follows:
        • “ We sent leads to sales and they disappeared into a
        • black hole !”
      • Why is this the case?
        • It almost always revolves around the issue that sales people do not see their benefit for providing feedback to marketing – no matter how easy the Internet or CRM systems have made it
        • Also, feedback systems can be perceived as “big brother”
    • 42. Some Benefits to Sales
      • Improving the lead process
        • Better campaign targeting and execution
        • Improved qualification process
        • Higher quality leads = more sales
        • More sales = higher compensation
      • An improved lead process eliminates calls that are of low value and interest to sales
      • Reducing the cost of the lead process and/or increasing the ROI allows marketing to budget for other important sales related activities
    • 43. What is Feedback?
      • Must balance between too little and too much
        • What are the key facts that are needed to improve the lead process?
          • Targeting question – company and people
          • Offer acceptance and applicability
          • Stage of the buying process
          • Sales revenue obtained and future potential
          • Input section – ideas from sales
        • Allow for sales to “hand-back” a lead for more development without penalty
    • 44. Process to Follow with Sales
      • First, involve them in the setting of the lead qualification and sales opportunity development process – involvement equals buy-in
      • Find the benefits that resonate with them – do not stress how important it is to marketing unless the benefits to sales have been first established
          • Let them know how much a lead costs
      • Allow visibility to all the inquiries and leads – don’t hide anything from sales
    • 45. Second Level Techniques
      • Recognition
        • Internally recognize those who are doing a good job on feedback
        • Do not publicly “dog-house” those sales people who do not provide feedback
        • Share sales success stories – show what feedback has done for the lead process and other sales people
      • Reward
        • Contests/rewards work to initiate a feedback program, but are not a long-term solution
    • 46. Distributors/Business Partners
      • Feedback is much more difficult
        • Use the same process of involvement
        • They view the prospect/customer as theirs and not yours – are they right?
        • Many OEM’s have misused feedback
      • Third party data centers may be a option, but keep control of the original data on the lead
      • Legal issues
        • The teeth to enforce feedback systems should be in the “primary area of responsibility” section of the agreements
    • 47. Conversion & Feedback 6 
      • Process
        • Sales calls/effort to convert the opportunity to a customer
        • Providing feedback to marketing on the result Sounds like the final steps of a process map.
      • Measures
        • Speed and completeness of feedback Standards & Metrics & reporting
        • Cost of the sale Measure, report, track AND then analyze
        • How many sales opportunities should be handed off to sales people at any one time? Standards for flow rates and what will fit through the smallest point of constraint.
        • sales people do not see their benefit for providing feedback to marketing
          • Every change management plan– every control plan has to address this. People processes need this like machines need grease, oil & fuel.
      • Controls
        • Some Benefits to Sales
        • What are the key facts that are needed to improve the lead process?
        • Process to Follow with Sales
      More key words & phrases mentioned.
    • 48. Conversion & Feedback 6 
      • Process
        • Sales calls/effort to convert the opportunity to a customer
        • Providing feedback to marketing on the result Sounds like the final steps of a process map.
      • Measures
        • Speed and completeness of feedback Standards & Metrics & reporting
        • Cost of the sale Measure, report, track AND then analyze
        • How many sales opportunities should be handed off to sales people at any one time? Standards for flow rates and what will fit through the smallest point of constraint.
        • sales people do not see their benefit for providing feedback to marketing
          • Every change management plan– every control plan has to address this. People processes need this like machines need grease, oil & fuel.
      • Controls
        • Some Benefits to Sales
        • What are the key facts that are needed to improve the lead process?
        • Process to Follow with Sales
      By now we’re repeating the same basic message – disciplined and data-driven breakthrough thinking in areas of business where process mentality has been scarce will yield great results.
    • 49. Conversion & Feedback 6 
    • 50. 7. Measure and Adjust Campaigns
      • Process
        • Analysis of the entire lead process and the marketing campaign adjustments required to improve results
      • Measures
        • Return on expense/investment – E/R
          • ROI is not really measured but is talked about
        • Customer lifetime value created
    • 51. Measurement of the Lead Process
      • To obtain credibility with management true results must be measured – not activities
      • The measurement ladder
        • Activity measurements
        • Value measurements
        • Result measurements
    • 52. Four Activity Measurements
      • 1. Cost per thousand or CPM
        • Just know it – don’t try to reduce it
      • 2. Response rate
        • A common measure of direct marketing but a “false god”
      • 3. Cost per inquiry – average $200
        • A fairly good measure to compare the effectiveness of media
      • 4. Cost per lead – average $2000
        • Depends on the strictness of the lead qualification criteria and process to qualify
    • 53. Value Per Lead
      • This is a new concept in measurement that attempts to place a value (not cost) on each lead
      • It is a measurement that bridges the gap between activity and result measurements
        • Average B2B sales cycle is 8 months and management usually wants to know campaign results faster than that
      • Requires a prior result or assumptions
        • % of leads converted to sale – 20% is average
        • $ value of the sale - yearly or lifetime
    • 54. Which Would You Rather Report?
      • Cost per lead of $2,000
              • OR
      • Value per lead of $20,000
        • Customer value of $100,000 (Year or LTV)
        • Conversion rate of 20% or 20 sales from every 100 leads
        • Total customer value generated is $2,000,000
        • 100 leads divided into $2 million = $20,000/lead
    • 55. Three Result Measurements
      • 1. Breakeven
        • How many sales are required to pay for the campaign expense is the “breakeven”
        • Benchmarks the campaign cost before execution and provides insight into the appropriate budget level
        • Requires a definition and agreement on what is the margin of the sale
          • Gross margin - usually around 50%
          • Net margin – 10-20%
    • 56. Three Result Measurements
      • 2. Expense to Revenue or E/R
        • Is a place holder for ROI, as this is almost never truly measured properly in accounting terms
        • Measures the ratio of the total campaign expense to the total gross revenue achieved
          • 1/10 is a minimum
          • 1/20 is good
    • 57. Three Result Measurements
      • 3. Lifetime value of the customer
        • Should be measured in margin dollars
        • Is usually a large number and can be very helpful in B2B, but is not often calculated
        • How long is a lifetime? (three years)
        • Needs to include all on-going sales and service costs
        • Recommend Fredrick Reichheld’s book on The Loyalty Effect
          • Justifies spending more money to keep customers
    • 58. Conversion & Feedback 6  Right metrics? Represent VOC adequately? Available, accessible, reported? Management will use? Change will result? Sustainable? What about process metrics?
    • 59. General Summary 6  Demand Response Qualify Develop Hand-off Convert + Measure Remember Big picture Watch the “white” space Data for decisions. Discipline of process Sustain the gains!
    • 60. Summary from 1 Sales BB
      • Take time – define the defect well.
      • Data is scarce
      • Processes are usually ill-defined
      • Process ownership is a fleeting concept
      • Process standards and CTQ’s not specific
      • Process metrics may not be linked to process outputs
      • Stakeholder expectations vary greatly
      • Root causes can be elusive
      • Humans are not machines = Change mgt. is tough!
    • 61. Applying Six Sigma
      • The purpose of 6  is to a c c e l e r a t e implementation of business strategies.
    • 62. Applying Six Sigma
      • Our purpose today is to a c c e l e r a t e adoption of 6  as key to aligning lead processes with business strategies.
    • 63. Applying Six Sigma
      • Think about it!

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