Sales Lead Definition – What is a sales lead? Mark Taylor, CEO of eSales Hub, takes you through a video giving an explanation as to what a sales lead is and the different sources you get can sales leads from.
Hi, my name is Mark Taylor from eSales Hub. Today I’m going to take you through what is a sales lead, what the definition of a sales lead is and the pro’s and con’s of different sources of sales lead.
What is a sales lead?
Sometimes there’s a bit of confusion as to what a sales lead is and what it isn’t – we’re going to go through exactly what a sales lead means and also its performance because there’s a lot of different sources of sales leads. For example, you might have heard of hotkeys, or you might have heard of form fills, or you might have heard of inbound calls? Well today what we’re going to walk through what those actually are and some of the expected performances that you could get, as well as defining what a Sales Lead is.
So what is a sales lead? A sales lead is a potential sales contact individual or organisation that expresses an interest in your product or service. It’s not traffic to your website or an IP address of someone that’s been on your website. A sales lead is someone who has made contact with you, who has expressed a desire to use your product or service and are in the market place looking for a service or product that you offer. But they haven’t chosen you yet, they’re still looking around.
But don’t get confused with prospect or a qualified sales lead
A sales lead is often confused with other terminology, including the term prospect. A prospect is not a sales lead – its the of stage before that person has made contact. An example being they might be in a database, you might have segmented them as a customer profile, but they are yet to contact you. What we would term as a prospect, in terms of definition of a prospect is; an organisation or a potential client who resembles your ideal customer profile but has not yet expressed interest in your product and have not made contact with you yet.
One not to get confused with also is a qualified sales lead. A qualified sales lead is somebody that has contacted you, they’ve started a dialogue and you’ve already qualified them into your sales funnel. They may have made contact through an inbound call and they said “I want your product or service it meets my needs”, or “I’m thinking about your products in service it might meet my needs”. But you’ve qualified them as a lead and they are now in your sales process or funnel.
Where can you get sales leads from?
There are multiple sources of sales leads that you should consider. However, one of the things to understand is the difference in performance by source. We’d always recommend creating a lead source funnel analysis for any type of lead source your use or are thinking of. The ROI that you get back from different lead sources can vary dramatically, even down to brand keywords on Google versus non-brand keywords; brand keywords can be very very cheap and sometimes non-brand keywords can be expensive, but which drives the better return on investment?
“Push” and “Pull” Lead Strategies
It is also important to understand the strategy of a lead source, is it being sourced from a push or pull strategy? Push lead sources are where you’re pushing an ad in the hope that people respond. An example of this is the type of old school of marketing back in the day where you’d put an advert in The Times to attract people to your product or service. I used to use The Times a lot when I was at Hilton Hotels, but from an online point of view, or from a lead generation point of view, the types of push sources are things like native leads like Outbrain and social media like Facebook. You’re putting an advert in front of Facebook audience and getting them to respond, they are not actively searching or looking for you.
Hotkey leads are similar in a way as a telemarketing agency will use a database of customer are call each one up, then when they are interested in your product, will forward the call direct to your sales team.
Pull lead sources are very very different; the customer is already searching for your product or service and you’re marketing your brand or product, you’re communicating to pull that customer to you. You are not targeting a ‘cold’ prospect, you are targeting someone that is in market and looking for your product or service.
Why do customers use Google to search?
Why do people search the Internet to look for products? I believe it’s because 1) they don’t know anybody who can service their need, 2) no one’s been recommended to them. This puts a lot of companies and brands in a unique position – the first company on Google that that answers their requirements in terms of the searchers product or service specific requirements, the customer is going to pick. They’re not brand savvy, because if they were, they wouldn’t be searching on Google.
Types of sales lead
eSales Hub Leads: Exclusive Leads, Generated in Your Brand
We pay for Google you pay per lead. But what is it we actually do? Our leads are generated from Google search and paid search through an inbound call from a potential customer. The big difference to most lead sources is they’re searching for the potential solution that your brand or company is offering as we target search using specific keywords. There are some pros and cons to the leads that eSales Hub generate. We’ve created the table below:
eSales Hub leads are high converting as you speak to them direct on an inbound call, there’s no calling the customer back like a form fill. They are fully GDPR compliant as an inbound call and they are very measurable. The downside is you have to be set-up to take inbound calls and your outbound call script won’t work – you’ve got to adopt your script and processes to make the most out of inbound calls.
Form fills are where data is received from a customer or client who’s entered their data through an online form. This could be a survey that you’ve run online, a booking request or simply a “Contact Us” form on your website. The good thing about Form Fills are that these are relatively inexpensive to generate and you can generate a high volume. But the problem you have with from fills is usually the low contact rate as you have to make contact with the customer to progress the sale. With an inbound call, if you answer each one you’ll get 100% contact rate. With a form fill, you may struggle to get a 30% contact rate. So if you’re buying 10 form fills you may actually only contact three of those, and of those three you might convert one – limiting your lead to sales conversion to 10%. You can actually end up a busy fool buying form fill leads – I was years ago when I was buying form fill data. We kidded ourselves that buying a hundred contacts a day was great, but we were actually only contacting five of those and we were probably only getting about one or two sales, which was a poor return.
Lead generators are an organisation that generates leads under their own brand, then sells them on to individual business, sometimes five to ten times over. A good example of such a company is Rated People and My Builder; they generate leads under their own brand and then sell them to local businesses. They are great at driving volume and you can sometimes see customer requests before you buy the lead, enabling you to buy the lead for the customers you are sure you can convert into a sale. But in selling them multiple times to other companies, can drive a reverse auction and can make the customer price-led. They’re also not generated in your brand, so there is no brand affinity; you’ve got to sell your proposition to that client whereas with an eSales Hub lead, because its generated in your brand, you don’t have the same challenge.
A leader aggregator is an organisation that is offering multiple offers and prices, to drive leads for specific participating companies. Companies like MoneySupermarket and Go Compare are good examples of lead aggregators. You can get very large lead volumes from lead aggregators, but the issue you may find is customer rentention – what’s to stop the customer going back to the lead aggregator every year and choosing another brand that’s got a cheaper price?
Sometimes clients and potential customers can get confused with eSales Hub leads and Hotkey leads. A hotkey lead is very different because its fuelled by a push strategy, not a pull strategy like an eSales Hub lead. Usually a telemarketing company will be phoning a whole range of data, literally pitching people who may not be interesting in your product, they may not even know it exists. But as soon as they get someone that they’ve qualified and meets the requirement you’ve set them as to what a hotkey lead is, they warm transfer them to you for your sales team to qualify or close. The good thing about them is they’re very high-converting; the telemarketing company will be phoning-up hundreds and hundred of potential customers on a database to find the one, two, three or five customers that want the products or service that you offer, saving you time. But hotkeys can be expensive because of the cost of trying to mine thousands of contacts. There is also the question of data protection which can be a problem unless permission has been granted for customers to be contacted.
Native and Social Media Leads
Another push strategy is using social media or native online channels to generate leads. Facebook have got millions of users everyday that you can target. Native, through platforms like Outbrain, enable you to target mass-markets too. But you’ve got to make sure your targeting is right as there may only be a small percentage of users that actually want your product, otherwise you are going to waste clicks. PPI Claim Companies used both sources a lot to great effect as almost practically everyone over 18 with a credit card or loan was a victim of the PPI selling scandal. This made both Facebook and Outbrain great channels to use to target mass volumes of consumers. The down side is the cost and speed it can take to generate leads; you may have to spend time experimenting with the right propsition and bidding strategy to drive any volume of leads.
Lead generation is the lifeblood of a lot of business and a key channel for most. Understanding the different strategies and types of lead are critical when looking at the performance of new and existing lead sources.
Creating your own ROI model for each and every lead channel you will give you a clear understanding of the performance of each lead generation partner. Even with your Google Ads campaign, separating out brand-terms versus non-brand terms and seeing the difference in performance can make a big difference.
Measuring the sales conversion is critical, particularly if you are using both “push” and “pull” lead generation sources. A push lead generation strategy might not be as effective as a pull strategy, but you may well need both to achieve your return on investment and sales targets.
You can buy cheap leads, but you could be killing yourself for that lead that costs only £10, but only converts at 10% , making your cost per sale £100. If you are buying a lead for £30, but it converts at 50%, you cost per sale is only £60, making it a far more profitable sales channel for your business and brand. Be sure to always measure and track your lead sources for optimum performance.
I hope the video and blog post has been interesting and you’ve learnt something. If you have any questions, please hit me up in the comments. Thanks for reading.