How to stop ignoring your best source of new revenue
Remember the Johnny Lee song, “Lookin’ For Love”? The lyrics perfectly sum up the most common B2B lead generation mistakes:
“I was lookin’ for love in all the wrong places,
Lookin’ for love in too many faces,
Searchin’ their eyes and lookin’ for traces,
Of what I’m dreaming of.”
Are you looking for your B2B sales leads in all the wrong places? Is your sales team searching too many faces, looking for traces of prospects, instead of narrowing the search to recruit only your ideal clients?
I bet they are, and in doing so, they’re clogging up your pipeline with cold leads and ignoring your best source of new business—current customers.
New business is harder and harder to come by. During these pandemic times, there are fewer opportunities and more competition going after the same exact business. How do most companies ramp up their B2B lead generation strategies? They reply to every RFP and win few, if any. They correlate activity with results. Not an encouraging scenario. There’s a better way, but it takes guts and conviction from every sales leader.
Of all the B2B lead generation tools at your disposal, referral selling is the most effective and least expensive. Yet, most companies miss the mark on referrals and instead make these common sales prospecting mistakes.
Why Your B2B Lead Generation Sucks: Reason 1—Your Sales Prospecting Priorities Are Wrong
Companies focus their sales prospecting on signing new logos. A salesperson closes a deal, hands it off to the customer success team, and then chases after new business. But when salespeople give away client relationships, they also give up future sales opportunities.
You’ve heard the often-quoted statistic that acquiring a new customer is anywhere from five to 25 times more expensive than retaining an existing one. It makes sense: You don’t have to spend time and resources going out and finding a new client—you just have to keep the one you have happy. Research from Invesp shows that existing customers are 50 percent more likely to try new products and spend 31 percent more than new customers.
Just as importantly, existing customers are your best source for new B2B sales leads. They know the value of your product or service, and they can provide referrals that fill your pipeline with ideal clients.
There’s no better example than Bob Wiesner, managing partner of the Americas for The Artemis Partnership, on how to grab that business. Their clients improve their pitch win rates by 30 to 40 percent, spend less money on chasing RFPs, and win 80 percent of their pitches when they work together. How’s that for attracting new clients in a highly competitive market?
Bottom line: Your current customers are ripe for new business. They’ll drive new revenue the fastest. But only if your salespeople nurture their existing relationships, get referrals to other divisions in client enterprises, and build customer loyalty.
Why Your B2B Lead Generation Sucks: Reason 2—Prospects Don’t Trust You
All things being equal, and they never are, people choose to work with people they trust. Buyers are putting more emphasis on trust now than ever. The stakes are way higher, because the risk of making mistakes is greater. There’s no room for error during a recession.
The #1 way to build trust with B2B sales leads is with a referral from someone your prospect knows and trusts. That’s the beginning of an amazing customer experience. It’s your level-set, because you arrive with trust already earned. The trust your prospect has for the person who referred you gets transfers to you. Your conversation shifts. You get insights that you’ll never find anyplace else, and your competition is clueless.
Why Your B2B Lead Generation Sucks: Reason 3—You Only Give Lip Service to Referral Selling
Referrals are lifelong. Once you close your first deal, you expand your reach by getting referrals to other divisions. Their referral reinforces the positive impact you’ve had on their business. Referrals integrate within the entire client lifecycle. Referrals are the initial great customer experience, and that experience and trust continue through the buying process, as well as the work you do after the deal closes.
Buyers consider referrals an important part of sales prospecting too. Just consider the following:
- 84 percent of B2B leaders start their buying journeys with referrals, and nearly 75 percent prefer to work with sales pros who were referred (Source: Sales Benchmark Index)
- 2 percent of business buyers prefer to work with vendors who have been recommended by someone they know, and 73 percent prefer to work with salespeople who’ve been referred (Source: IDC and LinkedIn)
- Referred customers have a 37 percent higher retention rate and are four times more likely to refer more customers (Source: Invesp)
Sales pros and leaders know from experience the value of referrals. Yet, 95 percent of companies don’t have a strategic, measurable referral system with accountability for results.
Alice Heiman puts it perfectly in her blog, “Customers for Life: The Art of Keeping Your Best Clients,” where she outlines the four pillars of customer retention—from onboarding to turning clients into referral sources. She writes: “The best thing about customers for life is they are loyal. Loyal customers will partner with you, give you feedback and best of all give you referrals.”
Yes, yes, and yes!
Why Your B2B Lead Generation Sucks: Reason 4—You Flunked Customer Retention
Henry Bruckstein, CEO of Campaign Stars, hosted several “Think with a Drink” virtual conversations. During one of these sessions, Justin Keller, vice president of marketing at Terminus, gave a presentation called “Retention is the New Acquisition.” He shared tips for B2B marketing and explained, “In a down economy, retention quickly has higher revenue impact than acquisition.”
Think about that. Your customer retention strategy is your ticket to acquiring new business. It’s your #1 B2B lead generation strategy. Makes sense. Instead of chasing new logos, now is the time to:
- Elevate the customer experience
- Expand your reach within the enterprise by getting referrals to other divisions
- Continue to provide insights and trends
- Take care of customers long after the implementation is complete
- Cement the trusted relationships you initially created
- Ask for referrals from every single client
Yet, a new survey by Forbes Insights suggests that companies aren’t giving more than a head nod to this approach. The study, entitled “Mastering Revenue Lifecycle Management: Customer Engagement Leads to Competitive Advantage,” found that:
- 29 percent of leaders think maximizing a customer’s lifetime value is not a priority
- 31 percent have a consistent customer engagement process
- 28 percent measure the success of customer engagement according to long-term value.
Those numbers are problematic, considering protecting and growing revenue is the new rally cry for CMOs and sales leaders alike. When you combine a leaky bucket where customers are churning with shrinking budgets to acquire new customers, you must focus on retention. The more customers you preserve, the more sales prospecting opportunities you have.
Why Your B2B Lead Generation Sucks: Reason 5—You Tried to Make One Size Fit All
Henry Bruckstein, of Campaign Stars, says the best way to engage customers is to create a personalized experience much like what they’re used to from Netflix and Amazon. The statistics don’t lie; personalization is the key to creating winning customer experiences:
- 78 percent of prospects will only engage with outreach that has been personalized to them
- 75 percent of prospects are more likely to buy from companies that personalize their engagement and will give them preference over the competition
- 63 percent of prospects are “highly annoyed” with the way businesses continue to rely on the strategy of repeatedly blasting them with generic messages
- 63 percent of prospects think more positively of a company if it gives them experiences that are more valuable, interesting, or relevant to their interests
I was appalled when Henry told me “less than 7 percent of customer success teams run these personalization programs.” We’re ignoring what works. Why?
Your Action Steps
Ready to refocus your lead generation strategies on what actually works? Here’s where to start:
- Reframe your sales KPIs to correlate with expanding business within existing clients, instead of chasing new logos. Consider a revised compensation plan to support this strategy.
- Build an action plan to solidify relationships with your existing clients. Ensure there are many touchpoints from your company to individuals within your client company.
- Commit to adopting a referral system to get referrals from your existing clients and build loyalty. They’re your most overlooked revenue stream.
- Analyze your B2B marketing strategy. Reposition by providing insights and trends to your current clients. Engagement is the name of the game. There’s no substitute for relationships in sales prospecting.
The research is overwhelming—tap into your existing customers with the same tenacity and elegance of approach as you do with your new account pursuits. Your current customers will likely refer you to new divisions, open up deeper relationships, and brainstorm new ways to expand with your product! No cold calling necessary.
Want to talk to Joanne about referral best practices? Choose a date and time to schedule a complimentary 30-minute call.