If you have a flood of leads, but only a small percentage of them are converting, you are not alone. Lead quality problems are incredibly common, especially in the SaaS/B2B world where the ideal customer profile (ICP) is often very specific, yet marketers are faced with high-volume lead generation goals.
Thankfully, the days of chasing quantity over quality may be over. In our SaaS trends for 2023, Co-CEO and Co-Founder of Chili Piper, Nicolas Vandenberghe, shared, “The economy in 2023 is expected to continue to cool, especially in the tech sector. With that change, companies will focus more on optimizing conversion rates over brand awareness plays."
It’s a sentiment Ortto’s Director of Growth Marketing, Charlie Windschill, echoed, saying, “After years of plush budgets and growth-at-all-costs acquisition strategies, marketers are now suddenly being asked to do more with less. As a result, many growth marketers will be shifting their focus to retention strategies and tactics for minimizing churn risk.”
With this increased focus on optimizing conversion rates and minimizing churn risk, there is an increased need to identify any lead quality problems your business is experiencing and overcome them.
3 common lead quality problems and how to overcome them
It’s easy to blame your website, landing pages, offers, pay-per-click (PPC) campaigns, content strategy, or any other lead-generating activity for your lead quality problems.
But if you are seeing a high percentage of low-quality leads across the board, it’s far more likely there’s a root cause at play that needs to be solved before you can start looking at individual campaigns or channels.
Start by addressing these three common higher-level causes. Once they are solved, you will be far better placed to assess which individual marketing campaigns, channels, and strategies are working and how you can better optimize everything you do.
1. You don’t know who your ICP is (or your assumptions are incorrect)
Without a clear understanding of who your ideal customer is or what their journey from lead to loyalty looks like, every marketing effort — from pay-per-click (PPC) campaigns to content production — could be contributing to your lead quality problems.
Often this lack of understanding stems from siloed or disparate data. When you are unable to get a single, unified view of your customer, creating key cohorts of high-value users or users showing signs of churn risk and drawing insights about their profile and behaviors is impossible. At best, you are making an assumption about an ICP that is based on incomplete information. At worst, you have nothing to work with at all.
When data is unified in a customer data platform, these problems are solved. Key cohorts can be built and analyzed to identify who your ICP really is, and to establish a set of data points that can be used to ensure your every marketing effort is targeted to the right audience.
2. Your lead-scoring methodology is ineffective
Part of identifying which campaigns and channels are bringing in the highest-quality leads is having an effective lead-scoring methodology that allows you to assess marketing efforts based on quality, not just quantity.
To do this, you need a way to accurately score leads. If your lead scoring process is a manual one, that is your sales team is scoring based on a set of criteria, valuable time is being wasted on conversations with low-quality leads or tyre kickers. This is where lead scoring software comes in — it will automatically score leads based on a set of criteria you identify.
Many lead scoring platforms work with a time-decay model where information becomes less relevant over time. This is important when it comes to behavior-based activities (like attending a webinar or completing a demo request form), but when it is applied to demographic or firmographic data (like Job title or company type), it can leave you with inaccuracies.
Ortto’s lead scoring model only applies the half-life indicated to behavior-based activities, while demographic and firmographic information is evergreen. This helps you build a more accurate lead-scoring model that can then be used to filter people or organization records, build reports, start automated journeys, or assign leads to the right rep.
It may also pay to have a few different types of lead scoring set up. For example, you could score leads based on buyer fit and buyer intent to give your marketing team a clear understanding of which campaigns and channels are bringing in leads that match your ICP and which activities are bringing in motivated leads or decision-makers. Or you might have more than one ICP or buyer persona, and can set up a scoring criteria for each.
Lead quality issues can often arise when marketing is focused on quantity of leads, while sales are focused on sales efficiency (total revenue divided by the time and resources). When this is the case, there is often a high volume of leads that come in from marketing and waste sales team’s time, causing frustration for both parties.
Instead, both marketing and sales need to be singing from the same hymn sheet — focused on efficiencies and quality, rather than quantity. Both teams need to come to a mutual understanding about what a great lead looks like, how quality leads can be identified (e.g. lead scoring) and routed to the right sales team member, and what the path to conversion should look like for each lead type.
In addition to regular cross-departmental check-ins, ensure both teams have access to the same unified customer data and create transparency around dashboards and reports.
There is no lead quality without data quality. To get the best leads, you need to have a crystal clear understanding of who those leads are, what their customer journey looks like, and how your marketing and sales teams can work together to bring them into the funnel.