Like it or not, your business needs a lead generation strategy and a sales prospecting process. It sounds easy, and it is.
With the help of this guide, you’ll discover exactly what lead generation is. You’ll be better equipped to implement a strong lead generation strategy within your business.
You’ll also know why you need a strong sales prospecting process and exactly how that will benefit your business.
Most importantly, you’ll find out how both of these strategies require an equal level of input and when you need to push one aside to focus on the other.
It’s not so much knowing about sales prospecting vs lead generation, as knowing how and when to prioritize one or the other.
What is a lead generation strategy?
A lead generation strategy is the simple process of finding your next customer. Leads are people, or businesses, that may potentially be interested in your service that your salespeople can then convert.
Therefore, lead generation is finding these people that could be your ideal customer – and then capturing their data.
There are different ways you can do this. Some sales reps choose to manually gather leads from business directories. Others purchase databases. You could have a go at improving your SEO rankings to try and increase inbound traffic and generate leads that way.
Businesses – especially those involved in B2B sales – do this to find new prospects and customers that they can drive down the sales funnel.
Leads come at the earliest of all the sales funnel stages. They might not have demonstrated an interest in your product or service yet, but from first contact there are signs that they’re in need of a product like yours.
For example, your ideal customer profile may be a business that is looking for the best task management software. Although a prospect may not have directly expressed an interest in your business specifically, you know they are in the market for a product like yours.
Targeting your marketing efforts towards this group gives you a much better chance of first generating quality leads and, ultimately, conversion.
Benefits of a lead generation strategy
Lead generation is great for businesses and sales organizations looking to find new customers and close deals more effectively. It doesn’t matter whether you operate in a B2B or B2C market.
There are several benefits when it comes to using a lead generation strategy, making it a good strategy for any business.
The benefits of lead generation include:
- Low-risk strategy given the small costs involved
- Find new customers and increase sales
- Find prospects to continue marketing to
- Gain insight into your target market segments
Problems with lead generation
It sounds easy, right? You know your customers – just go out and find some more. But why did nearly two-thirds of marketers list lead generation as a constant challenge?
It’s because a lead generation strategy is hard! You need to commit to your strategy, and somebody has to be responsible for managing the process.
You can outsource lead generation if it’s not something you have the resources for in-house. Although this can be costly, many businesses see a large return on investment (ROI).
Leads are invaluable as they have already entered the sales funnel.
Bringing lead generation in-house isn’t all bad. It helps to keep costs low. Your team will find it time-consuming but strong teamwork and collaboration will stop people from feeling burnt out.
Often in-house lead generation strategies are highly effective.
Your sales team knows what type of people are interested in your product or service, as well as having in-depth knowledge of the sales process.
They have a better idea of your target audience than anyone else in your company. That means they know which leads to capture, and what data to collect.
When should you use a lead generation strategy?
Every day? Once a week? Never? What do you think?
When you launch a business, lead generation is almost all you do. Building databases, asking friends and family, and creating social media accounts.
Marketing is a form of lead gen. You might choose to update your content marketing strategy to capture more leads.
As a general rule of thumb, you should never stop lead generating. However, as your business grows you won’t need to invest so much time and money into your strategy.
A good content marketing strategy can improve your search engine rankings and bring you leads organically.
Email marketing is the most effective tactic for growth, with only 18% of business professionals stating that it is the most difficult.
But every business is different. What suits you might not suit your neighbor, which is why a lot of small businesses trial different tactics at first.
So, you’ve started generating leads and you’ve built up a healthy-looking database of potential future customers. Now it is time to move on to sales prospecting.
What is sales prospecting?
Sales prospecting is what happens next.
It encompasses everything that your sales representatives go through before they close a deal, from cold calling (although a truly cold call shouldn’t occur if you’ve got lead gen right) through follow up, all the way to (hopefully) the ultimate purchase decision.
During the sales prospecting process, you already know that an individual is interested in your product or service (they’re a lead). The question is, how will you get them to choose you.
Depending on the nature of your business, this process may take some time. An individual might only take a few seconds to decide which brand of beans to buy but could take months before purchasing a house.
Within your sales prospecting process, there are three things that you have to manage.
These are qualifying, meeting, and closing.
First of all, you want to qualify your lead.
This process is as simple as asking a few questions and gathering business intelligence. It helps you get a better idea of where that lead is sitting in the sales funnel, and is key to effective prospecting.
Think of a trade show. When you are approached by a sales representative, they ask you very specific questions.
These questions have been designed to qualify you. Are you at that event because you have a genuine interest in the products on offer? Do you have buying power as a decision-maker or are you an influencer?
The right answers to your questions take a potential buyer to the point of being a qualified lead. As part of the sales process, qualifying leads doesn’t always get the credit it deserves.
It’s a key aspect of effective sales and generating new business.
Meeting your prospect can help solidify relationships and help with the decision-making process. Given the current restrictions, you may choose to host a chat video or conference call.
Either way, this is an essential step in sales prospecting – particularly for high-value or high-risk products or services.
There are different approaches you can take to meeting your prospects. Having already qualified them to be potential customers, you may choose to go straight in with selling your product or service.
On the other hand, you may find it beneficial to spend time nurturing the relationship before you tell them about your business.
This way, you can tailor your sales pitch to suit them by telling them exactly how you can solve a problem of theirs or alleviate their individual pain points.
Closing the deal is more than just reaching the end of the sales pipeline and getting your prospect’s name on the dotted line.
It’s about knowing how to welcome new customers and deliver an excellent customer experience. The entire sales prospecting process has led you to this moment.
Only by qualifying and meeting your prospect are you able to tailor your offering to suit their needs. You’ll know how much help they might need going forward.
Or if they just want to be left alone. Either way, you’ll have this information so you can deliver the customer experience that they want and need.
Benefits of a sales prospecting process
If you have a sales team, you can easily improve your sales prospecting strategy.
That is one of the main benefits. A little bit of training can go a long way and most businesses already have the resources in-house.
However, almost half of sales pros say that prospecting is the hardest part of their job. More difficult than gathering contact information on new leads or even upselling to existing paying customers.
Why? Time management.
Sales representatives are tasked with speaking to people at different stages of the sales funnel. Whether by emailing them, making outbound calls, or arranging face-to-face meetings with potential buyers.
Keeping on top of this is tricky. It’s easy to forget a meeting or lose an email thread.
That’s why it’s essential to use good project scheduling software and keep a lot of notes! As well as using CRM and other solutions that make data easily accessible to everyone involved.
Fortunately, there are things you can do to improve the productivity of your team and keep everyone involved in sales prospecting motivated.
Start with good communication, it might be necessary to handover prospects if somebody is particularly busy.
Training can help as well. The quicker you are able to qualify a lead, the quicker the prospecting process will be.
It sounds like a lot of work, but implementing strong sales prospecting techniques can benefit your business in more ways than one.
By nailing this process, you’ll build an army of loyal, happy customers.
These are customers who will share their great experiences with their friends and families, giving you a great source of referrals.
Lead generation or sales prospecting?
Now that you know what lead generation and sales prospecting are, it’s time to think about your business’s aims and objectives.
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The truth is, you probably want to implement a lead generation strategy as well as a sales prospecting strategy.
The two work in sync. However, as you progress and improve your own tactics, you’ll find everything getting faster, easier, and more effective.
Lead generation is good for businesses looking to broaden their outreach and find new customers. Your marketing team might try affiliate marketing or finding new leads on LinkedIn.
Sales prospecting is good for businesses that already have a lot of leads and are looking to move them down the sales funnel.
These leads could have come through your website or social media platforms, or you might have got a successful lead generation strategy in place.
Clearly, these two go hand in hand.
The diagram shows both lead generation and sales prospecting to be the same size, suggesting they are equally significant.
That is true. Without lead generation, you will have no leads to prospect. Without sales prospecting, you will rarely close a deal.
But just because they are both significant, doesn’t mean you need to do it all at once.
Think back to the sales funnel. Lead generation starts the process, sales prospecting finishes it. Or does it?
5 ways to tell whether you should focus on a lead generation strategy or sales prospecting process
Here are five ways that you can tell whether you should be focussing more of your efforts on lead generation or sales prospecting.
Firstly, you have to ask yourself five questions:
- How many leads have you got? If you have a long list of leads, but few new customers, it’s time to put more attention on your sales prospecting efforts. Have your team members work through the list of leads until each one has either been qualified or disregarded. This is a great way of adding an element of gamification to your business model.
- What are your business goals? Do you want to see sales soar this year? Or are you happy with your rate of growth? If your goal is to increase sales, it’s important to get sales prospecting right. Therefore, you may choose to focus more resources on this process.
- How busy are your sales team? If they’re already handling a lot, and are snowed under with meetings and phone calls, you may want to put more time into lead generation. That way, your sales team have a chance to catch up and are more likely to convert the prospects that they are working with. Use a shared calendar to monitor everyone’s workload and understand when you need to focus on a different strategy.
- What are your competitors doing? In most markets, you use competitor analysis to understand what you should be doing. This time, do the opposite. If your competitors are out there closing deals every day, they probably aren’t focussing on lead generation. This gives you a great opportunity to get to new leads first.
- What are your upcoming marketing plans? A good marketing strategy will bring leads to you, so you need a team ready to go through the sales prospecting process. Too much lead generation is impractical, as your team can only handle so much at a time. Take a look at what campaigns are rolling out and decide whether or not you still need to work on lead generation or if you need to dust off some more prospecting methods.
Time to close deals
As you can see, every business is different so there is no definitive answer I can give you when it comes to lead generation or sales prospecting.
Ideally, you would focus on both. But as that isn’t a realistic target, answering these 5 questions is a good place to start.
The trick, of course, is to implement a lead generation strategy that requires minimal input.
With leads falling on your lap organically, you’re free to build and develop the strongest sales prospecting process in your industry.