Generating Leads for B2B Firms Online Reduces Cost and Increases Quality

As a B2B marketer, generating leads is the name of the game. Generating leads for B2B firms online reduces their cost and increases the quality of the leads generated.

Are you generating enough high-quality leads for your B2B business?

Are you closing those leads or losing them to other businesses?

Today, we’ll help you generate more leads online, nurture them until you close the deal, and then turn your leads into loyal customers.

inbound marketing tactics
Image courtesy of B2C

Why you need leads

Unlike B2C sales, which usually occur on the spot, B2B customers come in several varieties.

    • Existing customers. You must still work to sell them your products the next time they need them. In a later section, we’ll discuss how you can turn these customers into loyal ones who return again and again.
    • Warm prospects are prospective customers who need a little handholding before you can close them. Since these offer the best prospects as future customers, you should work hard to close them by addressing any impediments that interfere with their buying your products. In the image below, these conform to what is called an opportunity.
    • A lead is simply a name for a customer that might be interested in buying your products. For instance, maybe you purchased a list of buyers within certain NIAC codes (similar to the old SIC codes, these identify businesses by industry). Maybe you collected cards at a trade show or got a list of attendees for a session or webinar.

       a lead versus a prospect
      Image courtesy of Selling SIgnals
    • Prospects are leads that make it through a qualification process. More on qualifying leads in the next section.
    • Cold leads are folks who don’t even know about your brand, its products, or its reputation

B2B leads versus prospects

A prospect is more than the name of someone or some business that might buy your product. A prospect, a qualified lead, is someone or a business that has these 4 characteristics:

  1. Need — they have a problem your product solves
  2. Money — they can afford your solution
  3. Authority — the individual has authority to make purchases or influences those who make purchases like the products you sell
  4. Desire — they’re motivated to solve their problem and spend the money necessary to reach a satisfactory solution

Missing any one of these factors eliminates a lead from becoming a prospect.

So, how do you go about generating leads for your B2B firm?

Here are some solutions based on Software Advice’s study of demand generation in B2B firms, which involved a survey of 200 B2B marketing professionals.

Generating leads for B2B firms

Generating leads for B2B firms is a tricky business, especially if you use the criteria listed above for a qualified lead. It just doesn’t make sense to generate leads that aren’t qualified because it’s very inefficient and costly. Poor lead generation impacts your bottom line by decreasing profits and increasing expenses.

When I worked for a direct marketing agency, the sales manager, an ex-IBMer, used to warn salespeople against wasting time with prospects who weren’t qualified. For instance, cold calling on lists or using SIC (now NAICS) isn’t fruitful since many of those calls are made to leads that won’t become prospects as they lack one or more of the criteria listed above. I realize a good salesperson thinks they can close everyone, but wasting time on folks who haven’t qualified as prospects just doesn’t pan out very often.

Cold-calling folks who put their business card in your fishbowl to win a prize at a tradeshow are marginally better. Sure, they might need your product (as evidenced by their attendance at the tradeshow), but they likely dropped a card to win a prize rather than any real interest in the products you sell.

Now, I’m not saying you should abandon these leads. Instead, fold them into a lead nurturing program and reach out via email to build them into warm prospects worth the salesperson’s time. So, let’s turn our attention to how to collect leads online and then nurture those leads using email marketing.social media generates leads

Social media marketing in generating leads

The graphic above shows the reasons why marketers use social media as part of their lead generation program. You can see that firms find social media marketing a cost-effective means for generating leads, featuring a low cost per lead. That explains why a third of those interviewed plan to increase their spending on social media. Most of the remaining businesses plan to keep their spending on social media marketing at the same level, which for the enterprise businesses making up much of the survey, is a substantial spend.

Some B2B firms seem to think social media marketing is only valuable for B2C firms. Not so. Social media marketing can help generate leads for B2B firms in several ways:

  1. Build awareness of your brand. Purchasing agents and others involved in the buying center might not intentionally use social media to find purchase options, but they’re using social media as individuals. Sharing valuable content on social platforms creates awareness through such personal usage.
  2. Targeted social ads effectively reach members of the buying center, especially when you use your existing email and customer lists to create a Custom Audience or target similar Facebook users—a Lookalike Audience.
  3. Social media marketing is particularly effective in reaching small businesses whose owners use social platforms both as individuals and as businesses.

Cost per lead

While social media and digital marketing, in general, don’t win the award for generating the highest quantity of leads, the quality of those leads is high, as reflected in the graphic. Social and digital also generate leads that cost less than other channels. So, while trade shows were deemed the best for generating leads for B2B firms, the cost per lead is also very high. Similarly, print and broadcast media generated high-quality leads at a very high cost per lead.

Generating leads with digital marketing

When you include digital marketing (ads, content marketing, SEO, SEM, and email marketing) in your social media marketing, you vastly increase the effectiveness of your lead-generation campaigns. Notice in the image below the importance of SEO (search engine optimization) is even greater in B2B marketing than when your business targets consumers.

SEO lead generation
Image courtesy of Brafton

 

Trends in generating leads

What are some trends in generating leads for B2B firms?

Michele Linn, content marketing director at CMI (Content Marketing Institute), cites firms placing more emphasis on lead generation strategy than ever before:

People realize now that having a demand generation strategy is so critical. They need to plan content along the entire customer lifecycle. And it can be very time-intensive and resource-intensive. So, from that perspective, it’s not surprising that people are increasing spend at all. It’s an engine that constantly needs to be fed.

I really like the notion of lead generation as an animal that needs constant feeding. Too many firms fail to implement effective strategies for generating leads for B2B firms for fear of costs. That’s because they don’t see the opportunity costs involved in fewer or lower-quality leads generated through other means. The costs of digital marketing show up on the income statement and reduce the firm’s bottom line. So, firms try to keep digital marketing costs low by using ineffective strategies with a low chance of generating leads. Some examples of ineffective strategies include:

  1. Posting infrequently. Studies by Buffer, Hubspot (see graph below), and others show that firms posting between 1 and 5 times per week achieve the highest results. Sure, you save money by posting less frequently (or not having a blog) but pay for it with fewer leads generated.

    blog post frequency
    Image courtesy of Hubspot
  2. Posting infrequently to social platforms is also cheaper but less effective at generating leads for B2B firms. You should plan to share at least five times on Twitter (now X), two times on Facebook and Instagram (if you’re using this platform), and once on LinkedIn every workday.
  3. Hiring a cheap agency isn’t cheap. Look at the results the agency gets for other clients. By that, I mean real metrics like ROAS (return on ad spend) versus meaningless metrics like clicks. As a first step, look at how they do for themselves. If they have poor domain authority, few connections on social platforms, and poor search performance, RUN. You’ll pay for those cheap results with poor lead generation.

Generating leads from your website

Your website should be the best tool for generating leads for B2B firms. The infographic at the end of this post (click to enlarge) from Onmicore shows the variety of ways to generate leads on your website. One caveat, however: Don’t use ALL these strategies, as you’ll provide a poor user experience, and Google will downgrade your site in the SERPs (search engine results pages). Instead, try a couple of these tools for generating leads, then monitor performance to determine what’s working. For instance, my exit popup generates the most email subscriptions for my list. Keet the ones that work best, then replace low-performing tactics for others until you come up with the optimal tactics for generating leads.

Nurturing leads

Of course, you can’t forget leads after spending time and effort to generate them. Instead, develop a strong lead nurturing program customized to your leads. While you could set up a lead nurturing program using any email provider, many B2B firms use a tool like Salesforce that allows them to customize emails to fit individual subscribers and supplement them with additional information, such as social media profiles. Salesforce also works seamlessly to connect marketing and sales. Hubspot is another tool used by B2B firms to personalize and manage their lead nurturing programs.

Turning customers into repeat business

Turning customers into loyal buyers who make repeat purchases and recommend your brand so you can convert prospects is the name of the game in generating leads that deliver value over time. Keeping existing customers is 5X less costly than replacing them, but not all customers are worth expending maximum effort to keep. Instead, consider the customer lifetime value (CLV), which considers both the extra revenue potential of an individual customer and the cost of keeping that customer. Here’s the formula for calculating CLV.

customer lifetime value
Image courtesy of Clever Tap

As a company, I might offer a discount to a firm that will provide a large potential for future business while not offering the same discount to a firm representing a smaller potential. My pricing recently increased for all my services. Customers who’ve done business with me over the years were able to avoid the price increase, while new customers or ones who infrequently did business with me must pay the increased price. Similarly, companies that require additional efforts weren’t able to avoid the price increase. In this way, I consider the CLV represented by a company in determining prices.

If you want to learn more ways to keep existing customers, check out this post.

Conclusion

Generating leads is only the first step in the process of closing them and building future revenue. You should adopt the strategies discussed in this post if you want to improve your market performance.

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Hausman and Associates, the publisher of MKT Maven, is a full-service marketing agency operating at the intersection of marketing and digital media. Check out our full range of services.



lead generation