There are basically three major contributions marketing provides to an organization: 1) build and maintain the brand; 2) build better products that are successful in the market, and; 3) drive qualified opportunities for sales get to more opportunity and close it more quickly. Drilling down on this third point, driving revenue, is where lead nurturing plays a critical role.
What is Lead Nurturing
At its core, lead nurturing is the process of cultivating leads that fit your target account profile but are not yet engaged in a buying cycle. In addition, lead nurturing should be used to remain engaged with existing customers to develop references, case studies, testimonials, and drive up-sell and cross-sell opportunities. By cultivating latent demand, companies can increase the conversion of unqualified leads to opportunities and drive more revenue. And, by maintaining a relationship with the customer base, usage, customer satisfaction and repurchase will increase.
Successful lead nurturing anticipates the needs of a prospect or a customer based on who they are (using profiling characteristics like title, role, industry, etc.) and the stage of the buying process they are in (awareness, interest, consideration, purchase, repurchase). Lead nurturing keeps prospects and customers engaged with your organization by providing relevant content (topical, technological, thought leader, benefits and features, updates, user groups and news) at the right time for each cluster or segment of prospects and customers. If done well, nurturing can build strong brand loyalty long before a prospect is ready to buy and can grow brand equity after the sale.
What’s the Bigger Marketing Picture
The concept of lead nurture is difficult to explain, and comprehend, outside of the concept of lead scoring and not within the concept of demand creation and demand management. Both of these concepts are critical to demand creation and demand management as they dovetail into one another to drive qualified opportunities and hence a precursor to revenue. In short, lead scoring ranks and prioritizes leads and lead nurture (for prospects) incubates leads that fit the desired profile and display a propensity to purchase. However, it’s important to take a step back to view and understand all of this in a marketing context.
Ready, Willing and Able
In general, in most served markets, approximately 2-5% of that market is ready willing and able to purchase at a point in time. Conversely stated, 95-98% of a served market is not ready to purchase. This does not mean that this 95-98% will not purchase, this relatively simple means that at a specific point in time this group is not ready to pull the trigger. In a complex sale there is typically a decision maker, an approver, a recommender, an influencer and a sniper. When you do the math, in terms of the number of people involved in a complex sale, the number is slightly north of 20 people. Another factor to consider is that the average sales cycle is approximately 6-12 months for an offering with a price tag of $100K or more. Lastly, budgets, personnel and organization structures change and there is always the end of the quarter, and Q1, bluebirds that can surface when unaccounted for funds are discovered. In summary, the vast majority of the leads that will be created will need to be nurtured before a purchase decision is made.
Target Account Profile
Since the majority of a served market is not ready to buy there are a lot of leads to sift through. A great tactic to sort through leads is to establish an objective to perform the task–a target account profile. A target account profile is a detailed description of a prospect that if engaged with the sales team will exhibit a high probability to purchase. This profile is jointly developed with sales and marketing and serves as a blueprint or profile for all prospects to be evaluated against to determine fit. Criteria used in the profile can range from whether the lead is new vs. an existing customer, presence of budget, company profile, core issues, perceived value, the presence of competitors, etc. The target account profile is a progressive profile that is populated over time to provide a detailed composite of each prospect. Ideally, a target account profile can be completed on an individual, and the organization, as the two may reveal different results. All of this information will provide an ideal breeding ground to segment the data so that it can be nurtured with a personal touch.
Buyer Behavior Model
Since prospects identified from the target account profile exercise appear in all stages of the customer buying process, the next step is to perform a segmentation analysis. A customer behavior model provides a model for understanding how a target audience interacts with a brand. The model is built in two phases. The first phase, the behavior model, seeks to answer what behavioral activities exist as an individual makes some type of commitment decision and at what phase of the buying process they are in. The second phase, the journey board, tries to identify every moment in the behavioral model that is an opportunity to make a brand connection by hypothesizing the brand’s communication possibilities at each phase in the buying process. Basically, the behavior model is a customization of the generic awareness, interest, consideration, purchase and repurchase model. The buyer behavior model will allow for personalized lead nurture paths for each segment of the buying process. Similar individuals will be bucketed together so that the right information can be delivered to the right individual at the right time of the buying process.
Summary – Lead Nurturing
In summary, lead nurturing is not a program or tactic that is executed on the leads that sales rejects or throws back. Lead nurturing is an integrated process that spans many systems and processes within sales and marketing and is appropriate for prospects and customers that fit the target account profile. Any lead nurturing effort that is less than what is described above is simply masking a weakness in your organization. Lead nurturing is a business fundamental that facilitates synchronizing sales and marketing by demanding knowledge of the markets, domain, buyers, sales process, buying process, competition and products and should be given the attention and resources it deserves and requires.
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