Dave Green, Best Practice Leader at MECLABS, reveals powerful ideas and insight that will take your lead generation to the next level and drive impressive ROI for your company in 2011. Find out how can you deliver what CEOs most want - leads - within tight timelines and even tighter budget, where to place your priorities, and how to rapidly make an impressive impact on your company’s revenue capacity, profit, and growth.

1. 2011 Lead Generation
Trends and Challenges
J. David Green
Director of Best Practices, MECLABS
#b2bleadgen

2. #b2bleadgen
• Audience Poll
• Challenges and Trends
• Economics of Demand Generation and Lead Management
• Sales costs and a cost-avoidance argument
• A revenue capacity argument
• Metrics
• Summary – Key Takeaways
Agenda
2

3. #b2bleadgen
Today’s speaker
J. David Green – Director of Best Practices, MECLABS
• Case study: $1B pipeline in 20 months
• Author and co-author of numerous white paper, blog posts, articles, and
the book, The B2B Refinery®
• Speak at MarketingSherpa, DMA, and other events
• 25 years of wide ranging B2B lead generation experience
• Working with large Cisco partner on lead nurturing projects
• Consultant on technology channel marketing
3

4. #b2bleadgen
MECLABS: A science lab with a consultancy
4
• More than 10 years of research
• 1,300+ major experiments
• Over 1 billion emails
• 10,000 sales-paths tested
• Hundreds of publications and
conferences

5. #b2bleadgen
Audience poll
• How many direct or indirect sales full time employees do you support with
leads?
• 500+
• 100-499
• 50-99
• 20-49
• Less than 19
5

6. #b2bleadgen
Audience poll
• On a scale of 1-5, how advanced would you say your lead generation
practices are today? (5=best)
6

7. Challenges & Trends

8. #b2bleadgen
What is the biggest worry of
innovative B2B marketers?
8

9. #b2bleadgen
• In 2009, 68% of marketers saw generating high quality leads as their
number one business challenge.
• In 2010, the percentage rose to 75%
Source: MarketingSherpa 2010 and 2011 B2B Marketing Benchmark Report
The challenge
9

10. #b2bleadgen
For the last three years, marketers have focused increasingly on lead quality.
This focus, in turn, has placed greater emphasis on:
• Data hygiene and enhancement
• Lead nurturing
• Lead scoring
• Funnel metrics
• Alignment
The current economy intensifies C-suite demands on marketing for ROI
The challenge
10

11. #b2bleadgen
What are the content implications
of lead nurturing and lead scoring?
11

12. #b2bleadgen
• More segmentation for relevance (personas, stage of consideration,
verticals)
• Low-production value content (e.g., blogs, raw video)
• More employee writers/thought-leaders
• More re-purposing/multi-purposing
• Content aggregation services through web-crawling and linkage/summary
• Integration of social media into lead nurture streams (as well as a demand
generation tool)
Based on trends in 2010 and projected for 2011,
nurturing and scoring depend on content
12

13. #b2bleadgen
What are data implications of lead
nurturing and lead scoring?
13

14. #b2bleadgen
• Less-end user data capture at the top of the funnel
• Incremental, optional, conditional end-user data capture
• Great focus on data hygiene
• Data appends (account, contact, triggers)
• Account-level modeling (propensity to buy and buying
potential)
• Content extrapolation of problems, function, level, depth
of interest
Based on trends in 2010 and projected for 2011,
relevant content-nurturing requires data
14

15. Economics of demand gen:
The cost of sales follow up

16. #b2bleadgen
How does sales leadership see the
economics of lead generation?
16

17. #b2bleadgen
Eight out of ten marketers hand
raw leads straight to sales
Source: MarketingSherpa 2010 and 2011 B2B Marketing Benchmark Report
17

18. #b2bleadgen
Decline in lead population through
the funnel’s early stages.
@ up to 5 attempts/lead
& @ 10 dials/hour
Sales-ready leads
Lead scoring, tele-qualifications4 - 7
1.6 – 2.8
hours
New leads
Filled out web form, called toll-free number, visited booth,
attended webinar, etc.
100
40
hours
Valid leads
Insufficient info, bogus info,
not in target market
70 - 85
28 - 34
hours
Mountains of leads, molehill of sales
18

19. #b2bleadgen
So what should those funnel
numbers mean in terms of expense?
19

20. #b2bleadgen
Assumes 1,960 hours per year and 19,600 dials.
“Cheap” leads cost a lot of money
Annual cost Hourly cost
Loaded cost/ Field sales rep $ (200,000) $ (102)
Leads Hours Cost/Hour
New leads 100 40 $ (4,082)
Valid leads 70 34 $ (3,469)
Sales-ready leads 7 2.8 $ (286)
100
70
7
20

21. Economics of demand gen:
The cost-avoidance argument

22. #b2bleadgen
What financial yardsticks exist in
your company for measuring lead
generation effectiveness?
22

23. #b2bleadgen
• How much time do your
sales people spend
prospecting?
• How much is that
prospecting time costing
your company?
Sales prospecting costs more than a CFO might expect
Generating
leads/researching
accounts,
18.70%
Account service
calls,
15.20%
Administrative
tasks/meetings,
18.00%
Selling: Face-to-
face or over-the-
phone meetings,
11.50%
Other: Travel,
training, etc,
36.60%
Source: CSO Insights “Sales Performance Optimization” report, 15th edition: over 1,800 companies surveyed. Copyright © 2009 CSO Insights. All Rights Reserved.
23

24. #b2bleadgen
In this example, the
entire marketing
budget equals the
portion of the sales
budget allocated to
prospecting.
Sales prospecting cost ≥ Marketing budget?
Sales prospecting
scenario
Revenue $ 1,000,000,000
Profit $ 100,000,000
Marketing budget $ (50,000,000)
Sales budget $ (250,000,000)
Other expenses $ (600,000,000)
Sales budget
line item
Time prospecting $ 1,000,000,000
Prospecting allocation $ 100,000,000
24

25. #b2bleadgen
Given that $50m budget allocation to sales prospecting from the prior slide, a
$200k loaded cost/field resource is the equivalent of 250 sales people.
($50m sales budget allocation) / ($200k/rep) = 250 reps
Sales prospecting equals a lot of FTEs
Annual cost
Sales budget $ (50,000,000)
Loaded cost/field sales rep $ (200,000)
Sales FTEs 250
25

26. Economics of demand gen:
The revenue capacity argument

27. #b2bleadgen
What revenue capacity can lead
generation unleash?
27

28. #b2bleadgen
Sales & Marketing Resource Allocation & the Buying Cycle
Prospecting Selling
Allocated
percent of
sales
resources
0%
100% These reallocated
sales resources
result in
increased
revenue
capacity/higher
sales productivity
More
efficient
sales
resources
Less
efficient
sales
resources
As much as possible, replace
these sales resources with lower-
cost methods of marketing &
telemarketing contact
Nurturing
Buying cycle stages
Lead generation scales sales
28

29. #b2bleadgen
Sales-ready leads increase revenue capacity,
profits and growth
Sales prospecting
scenario
Scalable lead gen
scenario
Revenue $ 1,000,000,000 $ 1,100,000,000
Profit $ 100,000,000 $ 190,000,000
Marketing budget $ (50,000,000) $ (60,000,000)
Sales budget $ (250,000,000) $ (250,000,000)
Other expenses $ (600,000,000) $(600,000,000)
Sales budget line item
Time prospecting 20% 10%
Prospecting allocation $ (50,000,000) $ (25,000,000)
• 10% more selling time
• $10m increase in
marketing budget
29

30. Economics of demand gen:
Key pipeline metrics for forecasting and analysis

31. #b2bleadgen
What funnel metrics can improve
sales and marketing planning,
forecasting and efficiency?
31

32. #b2bleadgen
Source: CSO Insights “2010 Lead Generation Optimization” report. Copyright © 2010 CSO Insights. All Rights Reserved.
For the first time in the seven years of this
report, a slim majority (51%) of responding firms
now track the ROI of their marketing campaigns.
32

33. #b2bleadgen
• Complex sales make
forecasting, analysis
and funnel-tuning
difficult
• Discrete funnel
conversion stages
improve forecasting
accuracy and narrow
problem identification
• Feedback loops can
improve upstream and
downstream stages.
Copyright © MECLABS 2010, all rights reserved.
Buyingcycle
New leads
Registered leads
Rules-validated leads
Phone-ready leads
Phone-validated leads
Sales-ready leads
Sales-validated leads
Sales outcomes
Sales-forecasted opportunities
75%
to
95%
Measuring discrete funnel stages improves
forecasting and operational efficiency
33

34. Key takeaways

35. #b2bleadgen
• Lead quality concerns are driving initiatives in lead nurturing and lead
scoring, which both are driving numerous marketing changes
• Sales prospecting offers marketers a financial yardstick for measuring
lead generation effectiveness
• The cost avoidance argument:
• Sales qualification is very expensive
• Sales prospecting is very expensive
Key takeaways
35

36. #b2bleadgen
• The revenue capacity argument: lead generation can improve the sales
and marketing expense-to-revenue ratio (sales scalability and sales
productivity)
• The right metrics can improve forecasting and drive continuous funnel
improvement
Key takeaways
36

37. #b2bleadgen
Contact information
Dave Green
Director of Best Practices, MECLABS
Co-Author of The B2B Refinery®
dave.green@meclabs.com
409-770-0710
MECLABS.com ∙ MarketingExperiments.com
MarketingSherpa.com ∙ StartWithaLead.com
StartWithaLead.com/LinkedIn
37