Business owners know that the single most important activity they can engage in is building leads. This can be the difference between success and failure. However, because the term has been thrown around in many different arenas, it is necessary to define what exactly a lead is? Why does it matter so much? And how do you go about attracting one?
Put simply, a lead is someone who might become a customer. A lead is someone who has had some kind of contact with your business and some sort of interest in your brand. They are interested, they are tempted and it only takes a little effort on your part to then push them over the edge so that they will become buyers.
But wait a moment: if a lead is just someone who might one day become a buyer, then how can a lead possibly be more important than a buyer? And what does this have to do with the state of business today? Surely a lead today is the same as it always has been?
Essentially, what makes a lead so important is that a lead is someone who might go on to make many more purchases in future. A lead is someone who has unlimited potential for you as far as your business is concerned. Now, a buyer is a type of lead in some cases, but not every buyer is always going to become a lead in future. If you have a lead before you have a buyer though, this suggests they are engaged with your brand and thus potentially likely to come back and buy from you more in future.
Instead of thinking ‘how can I make a quick sale?’ the question should be ‘how can I increase my customer lifetime value?’.
There’s another reason that leads are so important when compared with customers, which is that a lead is much easier to make than a customer. If you emphasise trying to make as many customers as you possibly can and if you try and force the issue, then your site is essentially just going to become a horrible exercise in sales talk. This might generate some revenue for you but it’s also going to turn a lot of people away from your site and away from your brand, never to return!
Creating a lead on the other hand simply means encouraging someone to place down their contact details and crucially to give you permission to contact them again in future. That is much easier to convince someone to do, meaning that you don’t need to use heavy handed sales techniques.
This creates a subtle shift in your approach to business too. Suddenly, you’re no longer trying to do everything that you possibly can do to convince people to buy from you. Instead, you’re just trying to build a relationship with them and establish trust so that they’ll hand over their details.
And then, once you have those details, you can be much smarter about the way you try and sell to them. You can time your attempt better so that you are selling to them at a point when they’re likely to want to buy and you can build up their interest more and more in whatever products you have.
So simply switching your focus from sales to lead acquisition is going to transform the way you approach business and give you a much more value-centric approach. In turn, this will ensure that you build an army of loyal customers that you can sell to again and again.
The Life Cycle of a Lead
In sales, we talk about leads as having a ‘life cycle’. That is to say that a lead will develop from one ‘type’ of lead to another as they become more engaged with your brand and as they become more likely to buy from you.
Generally, the lifecycle is as follows:
- Cold leads
- Warm leads
- Qualified leads
- Sales qualified leads
So what does this mean?
First we have the cold lead. The cold lead is the lead that you have only just acquired that knows nothing about your business and that, as yet, has no interest in your product or service. They are a lead though because you have their details/contact with them and because they fit into your target demographic and your buyer persona.
You know all those calls that you get from companies trying to sell you insurance, SEO and other services you don’t want? They are calling you because you are a cold lead. In other words, they bought your details (most likely) from another company because they know you fit their demographic. Now they know who you are, they have the means to contact you and you are someone who is likely to want to buy from them.
This is commonly referred to as outbound marketing. It is the process of reaching out to cold leads and attempting to build trust quickly. An expert in the field of outbound marketing and cold calling is Barbara Burstall from BBMC – Virtual Assistance.
However you got your cold lead, your next step is to convert them into a warm lead. Better yet, there are ways of ensuring that your leads are warm when they first reach you, which can save you a lot of trouble and effort.
The warm lead has everything that the cold lead does – they fit your target demographic, you have the means to market to them and they are statistically likely to buy from you. Their big difference is that they have shown some actual interest in your brand (if not your product) and hopefully even given you permission to contact them.
This might mean they have followed you on social media, it might mean they’ve joined your mailing list, or it might mean that they have sent you an email. These people haven’t necessarily indicated that they want to buy from you, but they have demonstrated some kind of interest in your brand and your ethos. These people are thereby much more likely to buy in the future when compared to people that you’ve never had any contact with.
A qualified lead is then a lead that has taken the next step and gone from being interested in your brand to being interested in your product. That means they have somehow shown interest in buying from you – perhaps they have asked for more information about a specific service for example, or perhaps they have added your product to their cart or to some kind of wish list. They might have asked for a quote, or they might literally have told you they want your service.
Either way, the qualified lead is now someone who wants to buy and who just needs that tiny push in order to actually take the plunge. You can also categorise leads as sales qualified leads (SQL) and marketing qualified leads (MQL). This is a term that is generally used in businesses with separate sales and marketing departments. It depends on which team qualified the lead and very often an MQL will be passed immediately onto the sales team to become an SQL. Sometimes you will also see the term ‘IQL’ or internet qualified leads. This is what this article will largely be dealing with.
Lead Scoring and Categorisation
There are more ways to think about your leads and to categorise them. Some companies for instance will actually ‘score’ their leads and use this as a measure of how likely they are to buy from you. Only once the lead has reached a certain level do you then go on to actually try and sell to them by sending a special offer by email, or by getting a member of the sales team to give them a call.
How do you score leads as a business owner? That’s up to you – but ultimately the more data you can collect, the better. You might for instance score your customer in terms of engagement with your brand (How often do they visit the site? How many of your emails do they open? Do they comment on your posts?) and in terms of the interest they’ve shown in buying from you. So, for example, a lead with a good score will be someone who has searched for your specific product, who has spent time looking at the item on your e-commerce store and perhaps who has actually made a purchase in the past.
Finally, you should also categorise your leads based on their demographics. That means thinking about their age, gender, income, location and more. This is important because a lead that has more money is more likely to spend more money with you and a lead that meets certain criteria will be more likely to buy specific products that fall into categories they’re likely to be interested in.
Creating Leads Face-to-Face and Through Other Means
Most of what we’ve looked at so far involves generating leads online and taking those cold leads from people who have stumbled upon your website or seen your ads and turning them into subscribers and later buyers. That doesn’t mean you can’t also build leads in person – and in fact there is a lot to be gained from this.
The great thing about building leads in person is that you have the opportunity to persuade them there and then to take an interest in your brand. You don’t have to sell it to them but if you talk passionately about your business, then you will often find people take an interest naturally.
Consider, for example, that you are a real estate agent. One way to make more people aware of your business is by attending community events within your territory. Speaking to other people that attend these events and then following up with them will help improve your lead flow and get people talking about your agency.
Likewise, you can build leads in person by going to tradeshows and networking events. This is actually a very good idea if you work online as it can help you to mingle with important people within your industry. Networking is something that a lot of people who work online tend to avoid – often they chose to work online in order to avoid having to talk to people! However, this is one of the most important things you can do for your business and can lead to all kinds of opportunities. If there are networking events in your city… go to them!
Marketing in the real world can also be a useful way to build more leads. One of the best things that any business can do is to have its website address on the side of its van, along with something that will get people to look at it. This can create some qualified leads without that company having to do anything! The same goes for fliers and leaflets – the recipients will start off as cold leads, but when they get in touch knowing what it is you’re selling, they will be qualified leads.
The same goes for t-shirts with your branding printed on them (corporate gifts) and these will work even better if you hand them out to your visitors. This also helps to make those visitors feel even more like they are a part of your movement and simply by wearing your t-shirts, they will be increasing their engagement and their ‘score’ as leads.
Finally, consider any contacts you already have that you can potentially use to build more visitors and leads. This is something that a lot of people forget to do or even feel too shy about their business to try. We don’t like the idea of marketing to our friends and family and especially if we aren’t confident in our businesses. However, think about it like this: if you don’t have the confidence to market to people you already know and those who will support you, how can you market to people that you don’t know? If you don’t take your business seriously enough and aren’t proud enough of it, how can you expect anyone else to take it seriously? Your friends are also the people most likely to forward on your emails, to like your social media posts and generally to help you grow your audience. Don’t overlook them because this can end up leading to exponential growth!
The Best Outbound Lead Generation Methods
At this point you should have a solid understanding of how lead generation works. More than that though, you should recognise how it actually plays a much more important role when it comes to designing your business model. Lead generation is about making people want to subscribe to your brand and making them passionate about your mission. It’s about setting out to do something worthwhile and reaping the benefits – rather than setting out to make a quick buck.
But just to recap on the basics, let’s look at some of the most important strategies you can use to generate cold leads, to turn them into warm leads, to build qualified leads and then to sell to your customers…
Finding Cold Leads
First, make sure that you have a clear mission statement and a well-defined buyer persona. Then use the following methods…
- Using flyers.
- Using PPC advertising on Facebook and Google to target your demographic.
- Going to events.
- Handing out business cards.
- Don’t overlook LinkedIn – especially for B2B leads.
- Using routes to market – such as online communities or even things like industry magazines.
Making Warm Leads
You can warm your leads up by making sure you are promoting the lifestyle and your value proposition through social media and by providing value in your posts. Then…
- Get them to join a mailing list.
- Follow you on social media.
- Get them to get in touch with you (make this your aim rather than a sale if you are writing copy for a business).
- Use incentives to encourage subscriptions – the best incentive being a mailing list that offers real value!
- Use the right persuasive copy to convince people to sign up.
Getting Qualified Leads
- Use a sales funnel.
- Use SEO with your content marketing so that people find your site already wanting your services.
- Encourage people to sign up for more information or for special offers on certain services.
- Monitor your leads’ behaviour and give them a lead score. Use CRM software to contact the most qualified leads.
- Offer special offers and deals to your most qualified leads.
- Use follow up messages.
- Utilise remarketing.
- Use urgency and scarcity to make them act quickly.
- Remove buyers’ remorse.
- Remove risk.
- Minimise the barrier to sale – make it as easy as possible for your customers to make a secure transaction without going through a lengthy process to enter their details.
By using all these different methods, you can then find new cold leads and take them from that point to being qualified leads that are willing to buy your products. From there, make sure that you look after your customers – provide a very good product or service that will reflect well on your brand, create offers to encourage brand loyalty and let them know about your future products and services.