Posted on 25 Jan 2022
How Does Lead Generation Work?
The process of attracting new business opportunities can be difficult and time consuming, but it’s a vital component of any growth strategy. If you’re going to grow as a business with new clients or customers you need to find new sales leads, and that’s where lead generation comes in. Today we’re going to take you through the process of lead generation and we’ll also explain how it works, enabling you to adapt your lead generation strategy accordingly to not only find those all-important leads, but convert them into fully paid-up customers, too.
We’re going to explain a little about what lead generation is as well as what’s involved in the process, and how you can ensure that your sales team don’t become “those people” who are cold-calling irrelevant “prospects” at the worst possible times of day.
Once you know what you need to do, what your approach will look like and how to qualify your leads you can put your plans into action and start identifying and engaging your leads - so let’s get started.
An introduction to lead generation: what is it?
Lead generation is the kind of process that a lot of businesses take on across the company, asking certain members of staff to find opportunities to get a foot in the door with a view to pitching for a contract. Others employ the services of new business or sales teams specifically tasked with generating and then converting those leads. Neither method is particularly ineffective, but both require a great deal of time in order to be effective which doesn’t necessarily come so freely in the case of the former.
A successful lead generation strategy is one that involves detailed research not only into the types of opportunities out there, but also the businesses behind them. Taking a scattergun approach to lead gen is great when you just want leads in and don’t really care about where they come from, but this is a short-term win and may create more problems down the line. A more specific, strategic approach based on business objectives might yield fewer leads in terms of quantity, but they may be of a far greater quality and a much better ‘fit’ for the business.
What do we mean by that? Well, in order to be a good ‘fit’ for the business the lead or prospect should be the kind of business that you want to work with, and will enjoy working with, and will have a mutual respect for. A lot of businesses win contracts and find down the line that their clients are a complete nightmare. Nothing is ever good enough, deadlines are never met from their side and communications can be difficult - all this results in is a termination of the contract and both sides are back to square one. This isn’t necessarily down to any poor performance on your side (it may genuinely be that you found a nightmare client), but greater research and diligence can help to whittle away nightmare leads so you can focus on good quality, qualified leads that you can work with for a long time to come.
It might also come down to what is best for you as a business financially, as well as personally. You may have to set out criteria that you can work within in terms of profitability as you can’t take on a project that will ultimately end up costing you money, and similarly you want to ensure that you have the resources available to meet the needs of the customer or client.
How does lead generation work?
So now we know the theory behind it, let’s get to the practical side of lead generation, which we have discussed before here on the Clarity Stack blog, but we’ll go into more detail today.
There are a number of ways in which you can generate new leads including email marketing, website sign-up forms, gated content, telesales, social media promotions and investing in platforms like Clarity Stack to do the hard work for you. Each is effective in its own way. There is no right or wrong way to generate new leads, but your approach needs to vary according to the method and campaign.
What is most important in the lead generation process is to nurture your leads through the process. The first step is to get somebody into your sales pipeline, making the prospect aware of you and what you have to offer them, before increasing their interest and taking them from a prospect to an engaged lead and then, finally, converting them into a paid-up subscriber or customer.
The first steps in the process are key in all of this, as you don’t just want to target numbers when it comes to lead generation - the quality is more important than the quantity, as we outlined earlier. The better the quality of the leads that come in in terms of genuine interest in your brand, product or service; the greater the likelihood of those leads turning into customers.
What should my lead generation process look like?
Every lead gen strategy is going to differ depending on natural business factors such as resource, budget and goals; but on the most part the process remains fairly consistent.
You should always start by engaging with a visitor to your site or social channel, allowing them to look around and discover who you are and what you do. They clicked onto your site through a search query or because they’ve heard about you from somewhere or someone else, and they may have visited your social profile through a paid ad.
Once on your site or social channel you should look to capture their details and retain their interest in your brand by offering an enticing call-to-action (CTA). This could take the form of an image, a button or a form but enables you to collect their information and direct them to an additional page on your site which offers them the content they are looking for, or the confirmation that they have signed up correctly and someone from the business - perhaps the sales team - will be in touch soon.
When you have their details you can use them for future marketing or sales campaigns, and they are now officially “a lead.” It’s then for your sales team to identify the lead’s stage in the buying process, and reach out to them at the optimum time.
Adapting your strategy for your audience
It’s important to remember that you should always tailor your lead gen strategy for all stages in the buying process. Someone that you’re speaking to for the very first time might not be at the point where they can hand over their card details and sign-up there and then, so you need to adapt your approach for people at all stages in the funnel.
Someone who has engaged with a piece of content on your site, like a gated eBook, might have handed over their contact details in order to access it but that doesn’t mean that they’re ready to buy what you’re offering. They might be looking to learn more about the processes and strategies that they could develop if they invest in your service in the future, so you need to ensure that you’re tailoring your approach to these people at the beginning of their journey, with your focus perhaps on a call-to-action built around arranging a call to learn more.
Then, as they become more accustomed to who you are, what you do and what you have to offer you can adjust your approach to a more experienced lead, offering them the opportunity to sign up for a free trial and this is where your sales team can get to work. Give them the time to get a feel for your product or service with genuine, live features that they will be able to use if/when they sign-up for real, and then your sales team can speak to them about how they can benefit from them on a more permanent basis when they pay for their chosen package.
How do I qualify my leads?
Lead qualification is also a key part of the process, and will help you to remove the time-wasters from your pipeline so you can focus on the leads that are most likely to convert.
There is nothing more frustrating than giving up your time to speak to a prospect, even getting them to sign up to a trial or offering your time for a demonstration perhaps, only for them to say that they’re not actually interested in buying. Even when they’ve gone through all of the details early in the process such as the discovery phase and learning how much it will cost, the time taken to get to this point can be better spent on those who are ‘hot’ leads rather than ‘cold’ leads.
As we’ve mentioned already, lead generation strategies vary from company to company and your approach will differ accordingly, but you will always have to gather a certain amount of detail from your prospects before you can make an informed decision on their level of interest.
You might have what is known as a Marketing Qualified Lead (MQL), where the person has engaged with a piece of marketing material, such as an email, before filling in a landing page form on your website to receive further communications or blog updates from you. This might be their first interaction with your business or service and as such they are not ready for a sales call at this time.
When someone fills in a form that specifically requests a call back, or they send you a message through your contact page asking for more information, this prospect becomes a Sales Qualified Lead (SQL) and is ready to speak to a member of the sales team about what you can offer them.
Finally, you have Product Qualified Leads (PQLs) and Service Qualified Leads. These are the most engaged prospects you could possibly have, with PQLs signing up for a free trial and approaching the end of that period meaning your sales team can do their research and prepare themselves to convert the lead into a customer. A Service Qualified Lead is someone who might be an existing customer on an entry-level or free package, but has spoken to their customer success manager and is ready to upgrade their subscription to a paid or more detailed package - the holy grail!
Your lead generation strategy will continue to evolve as you do, with all kinds of options available as your business grows. A successful lead generation strategy will mean new customers, but also new possibilities to continue your growth into new business areas so be prepared to adapt and evolve your strategy as your business goes through a similar process.
Whichever route you choose to take with lead generation, be that a social media focussed route with paid ads on Facebook, LinkedIn et al; or an email marketing campaign that hits inboxes around the world and drives traffic to your site through engaging CTAs, you should always be prepared for periods where a once solid strategy will need adapting. It might be a new email subject line, perhaps a different call-to-action or even a brand new landing page or piece of gated content on the website as part of a new campaign.
There is no tried and tested, surefire, one-size-fits-all approach to lead generation, but with plenty of time and effort you will start to reap the benefits as the number of qualified leads in your pipeline starts to grow - and flow.
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