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The big fantasy behind the realm of lead management: Interview to Miguel Todaro
I asked Miguel Todaro what would be the most important topic to talk about this month at the Marketing Groupin thinking for an exciting topic for November’s agenda. “Lead Management” he said without even thinking about it.
- Why do you think that lead generation is the most important topic to discuss today?
- In the last five or seven years I’ve learned that the majority of the players that offer lead generation systems, software, programs and techniques, have entered in a virtual reality mode. In other words, these companies or consultants forget the real potential value of the lead and simplify the concept in an empty “number” without additional analysis, believing that their job is to bring numbers instead of sales, results without any strategic evaluation.
-Can you be more specific?
- The modern concept of “qualified leads” has been vanished and replaced by simplistic reports that overview visitors and name then as simply “leads”. This is wrong. The term “qualified lead” was implemented by educated analysts and marketing professionals with strong comprehension of the market dynamic.
Lately I grew tired of listening about numbers, statistics and useless reports with mediocre indicators. Let me explain in detail what is a useless indicator: Every time that a website traffic report shows the numbers of visits to the site (or to specific parts of the site) with some conversion rate of people that fill the contact form or call to the company for more info, that is a big fiasco. Numbers are not leads.
- What you are saying is that traffic is not enough, what is important, is to understand the leads.
- Yes. Sometimes the implementation of a real process to determine the qualification of the potential customer is not convenient for third party companies that just try to sell their software and keep it simple. A deep analysis of the level of qualification of the visits might show that the promotional strategy, or exposure reach, is insufficient and even numbers might be significant, the conversion rate from leads to customers is unsatisfactory.
Don’t forget that the investment of any lead generation strategy is based, and eventually paid off, by the amount of customers acquired, not the level of visits or market interest.
- What is the major reason behind the phenomenon you are pointing?
- I believe there are several factors. Christopher Rohn from the Sweden publishing company Jocks Co. explained the difference between the leads and qualified leads very well. He developed many strategies oriented to recognize the level of progress of each lead coming from their e-commerce website. His objective was to redefine the word lead into their own internal system, removing the “leads” that were not going to turn into sales. The result was pathetic. Many of the venues that drove the big traffic were low or zero level leads; just curious people with no real desire of buying, or moving forward on the sales process. Even the channels he really believed were the most promising demonstrated the opposite.
He was able to adapt his strategy to the dynamic behavior of a market that was telling him another story, even if it isn’t the story he wants to hear.
- Are you saying that the only valid argument at the end of the day is about money. The direct formula of dollars against investment of new implementations?
- I say that there are no standards for lead generation techniques. The significant failure reason of lead generation strategies, often forgotten by many marketers, is that the market is a dynamic monster with many faces. The constant evolution of the market implies the usage of more creative ways to gain penetration. A system or software designed to captivate “a market” does not understand the dynamic factors that make the market volatile and sometimes unpredictable.
- Can you provide an example of that?
- Yes. One of my favorite recent examples is Facebook. Many markets believed (and still believe) that Facebook provided a good opportunity to balance the PPC offering of Search Engines. From the beginning the model was certainly attractive and the numbers too. The impressive amount of traffic and users was astonishing without any doubt, but the quality of the leads were poor and almost with no conversion. Many companies invested in Facebook with the blind expectations of generating millions of leads, but after a while they were forced to rethink the strategy and relocate the investment in typical PPC venues again.
Another observable fact is Kijiji.com. In order to generate a sublevel of business, companies were trying to generate another sublevel of business. Let’s remember that Kijiji has a 20 million of captive people per day surfing its pages.
What those companies forget is that Kijiji’s market is looking for alternatives to what the typical companies would offer. The penetration of those companies using bulk systems in order to mix their offers with private sellers is a big mistake and kills the potential value of the site. For instance, people who are looking for a used XBOX 360 want a 180 dollar product, in good shape, probably from somebody that is not using it anymore. That market is not interested in offers from Futureshop about a brand new XBOX that costs 400 dollars more.
- What does it take to qualify a lead?
- That is a tricky question. To answer that, of course, some variables that must be considered. The industry, the competition’
In order to simplify answers I would say that the best approach for lead qualification is to ensure that the plan (and eventually the implementation)
- What would be same final advice in order to complete this topic?
- I think that the best recommendation is to avoid long commitments with third party companies in this field. I’ve advised many corporations and I witnessed that these types of companies try to sign 12 months-minimum contracts in order to do business. That is foolish and totally unethical. There is no need for long commitment contracts if the product is effective. Who is willing to abandon a product or service that is successful? Stay away from that situation and let the in-house marketing expert direct the lead generation strategy instead of external “miracle-maker”