Why Sales Leads Fall by the Wayside

Would you like to turn leads into sales? If so, then do not give potential customers to your sales team.

As we begin this journey, let’s first agree on two things:

  • Between 80% and 90% of leads from activities such as trade- shows, advertising, direct mail, etc., do not have an immediate need at the time they are gener- ated; and
  • Of the leads that do not offer an immediate sales opportunity, the vast majority do buy the types of products and services being offered and, therefore, are worth cultivating. They just have an existing supplier they are happy with, lack knowledge of you or your company or just do not have a project right now.

Now that we agree, let’s move forward and discover the reasons why sales people should not follow up your leads.

Management’s Focus

Walk through the sales department of any organization and you will constantly feel the pressure to close sales. Presidents are pressuring sales managers, who in turn pressure the sales force. Everyone has a “number” or quota they are trying to hit this month or quarter.

This sales culture is neither wrong nor inappropriate. Companies live or die by their sales and need to set short-term, quantifiable objectives for their sales organization. But the sales team’s focus, as to be expected, is not on the long-term stability and quality of the sales pipeline but on what is going to close now. As a result, leads that do not offer any immediate sales opportunity tend to be left behind.

Compensation

The very manner in which sales people are compensated motivates them away from the long-term cultivation and nurturing of future opportunities.

Most sales people are compensated, in some portion, by commission or bonus. As a result, they have really no choice but to focus on the low-hanging fruit. Because the vast majority of leads generated will not offer short-term revenue, the sales person, after following up the lead, will tend to let the long-term opportunities fall through the cracks in order to concentrate on “paying the bills today.”

Skill

To secure a new customer or win a project requires certain skills, such as the ability to understand a customer’s needs, present a solution and ask for the sale. The ability to nurture and cultivate a lead until a project materializes, however, requires a different set of skills, including patience and perseverance.

Rarely does the typical sales person possess both the ability to drive a short-term sale and the nurturing behavior to cultivate a lead over the long term. Yet more than 90% of corporations still expect their sales people to perform both roles. To no surprise, the results are predictable: Either the sales person uncomfortably plugs away at lead follow up and cultivation, growing more and more frustrated, or more often than not, they simply choose not to do it.

Preference

The last reason many leads are not pursued properly is related more to the interpersonal side of things than to business, structure or organization. The basic fact is that for most sales people, it is simply more fun and more motivating to close deals and work on projects with a handful of customers than it is to try to turn a few hundred relatively unenthusiastic suspects into actionable opportunities. This is especially true when the buying cycles are six months to two years or longer.

So if sales people are not the right resource for the job, then who is? We need to turn our attention toward finding people who are a better fit.

These people—business development representatives, as I call them—are a different breed. They find joy in working a relationship over the long term, researching and digging into a prospect and persevering through the battle. These people are usually less motivated by commissions and ego and more motivated by success for the team and self-worth.

A separate department should be established with the mission of taking leads generated by marketing and driving them until such time as an actionable project is identified. At that point, they hand off the opportunity to the sales person to consult and close.

So where does the money come from to pay for this new department? Well, by actively cultivating and working every lead generated until there is an actionable project, whether that takes one day or two years, your organization will generate far more opportunities from those leads than you ever did when you just handed them out to the reps and watched 80% of them fall through the cracks. These incremental projects will turn into incremental sales and, therefore, will pay for any additional expense.

The role of marketing is to fill the pipeline with opportunities for the future. Yet the role of sales is to focus on the now. With that clear mismatch in objectives, the business development role is your middleman and the key to turning leads into sales.

Darren Rabie is president of Focus America. Rabie can be reached at 416.489.7937 or by e-mail at drabie@focus-america.com.

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