How many leads do you need to hit your annual growth target?
Is your sales function properly resourced? You may be struggling with lead generation because you don’t have the right sales team in place. Perhaps you are basically the sales team, selling alongside your other responsibilities. Or the team may have developed from your technical engineers who know technology and your services inside out – but can they communicate the business benefits of these services to prospects? Many can’t.
One thing is certain, lead generation should be part of a wider process, rather than the result of a series of isolated campaigns – with marketing activities driving the initial contact and engagement, nurturing interest and ideally also pre-qualifying leads prior to your salespeople making contact.
As an MSP you understand the importance of being process-driven – but you will also be aware that putting in place a successful lead generation process can’t be done overnight. You need to take the time to build up a sales and marketing engine over time that will generate leads and feed the pipeline. And these processes should include a range of marketing activities: website, direct mailing, event attendance/organisation, thought leadership pieces, customer testimonials and so on.
If your business is too small to justify a fully-staffed marketing department – or a sizeable marketing budget, another option is to start off by outsourcing key marketing and sales support activities to one of the many specialist agencies. But, before you start any marketing campaign you need to begin with the end in mind. You need to identify how many leads you need to feed the sales funnel in order to hit your annual growth target?
How many leads do you need to feed the sales funnel?
You may already have a sales and marketing programme in place that is capable of feeding your sales funnel with qualified leads and engaged prospects. But do you know the size of the task ahead? Have you worked out your lead generation plan – in other words, how many leads do you need to pour into the funnel to produce the required number of signed contracts at the bottom that will meet your monthly revenue targets?
There’s an easy process for calculating this figure:
- Establish your annual revenue requirements (ARR) goal.
- Work out your average contract size.
- Calculate the number of new customers needed to meet your annual growth target.
- Calculate how many leads are needed to win those new deals.
- Establish what a lead is worth to your MSP and how much you are willing to spend.
And don’t forget to continually review how you are doing in terms of achieving the goals you have set. Various software packages are available to help track progress, such as Hubspot and Salesforce (to name a couple) – or you can just use a spreadsheet if your prospect/client base is relatively small.
Review the marketing activities you are using to generate leads too – and if they are not delivering the volume you need, don’t be afraid to change tactics and try a different approach. Flexibility is key, especially during these unpredictable times.
Salespeople are also an expensive resources. You don’t want them to waste time following up a lead from a company which is not a good fit for your services. It makes sense to do as much qualification as possible within the marketing process. Successful qualification relies on you having a clear idea of the type of company most likely to buy your services: typical size, vertical market, geographical location, industry/technology affiliations – or whatever other attributes make up the ideal profile for you.
Many MSPs hire a Sales Development Representative (SDR) to qualify all marketing leads and book appointments for individuals in your sales team. This works best when your sales team have different territories, allowing your SDR to book appointments quickly and easily.
- Create a strategic marketing campaign to generate leads.
- Start with the end in mind and establish how many leads you need to hit your annual growth target.
- Track your progress whether you use a software package or spreadsheet.
- Qualify your leads to maximise success.