Forrester reports that 99 percent of leads do not convert. LinkedIn reports that 87 percent of leads do not convert. So why are marketers so focused on lead goals and cost per lead when it comes to LinkedIn marketing and social selling?
I believe this is giving marketing a false sense of LinkedIn success or failure. Here are three examples to show you what I mean.
Wiley’s CMO Focuses on High Click-Through Rates Instead of Revenue Generated
As I mentioned in my recent article CMOs Are Failing to Go Beyond Brand Awareness on LinkedIn, Wiley’s CMO, Clay Stobaugh, focuses on sponsored updates and sponsored Inmails. I must admit, Wiley’s is getting amazing click-through rates. But Stobaugh never discusses how many of those click-throughs are becoming leads and how many of those leads are turning into actual opportunities and actual clients.
Now, let’s assume that many of those click-throughs become leads and he has a low cost-per-lead. If those leads do not move forward, then he has a high cost for business growth. And, their efforts on LinkedIn are nothing more than a cost center. It doesn’t matter how low the cost-per-lead is if leads are being stuck at the top-of-the-funnel. It’s still a cost and investment that isn’t leading to revenue. Do you see what I mean about a false sense of LinkedIn success by focusing on cost-per-lead?
Social Media Firm Focuses on Lead Goals Even Though Leads it Delivered Went Nowhere
I recently spoke to the president and CMO of a logistics company and they were both totally focused on how many leads they are able to deliver on a weekly and monthly basis. They proceeded to tell me how another social media lead generation firm was delivering five to 10 leads for sales calls per week.
However, those sales leads they were delivering went nowhere. Ninety percent of the calls were with prospects who were not in the right stage of the buying process at that time — or they were with people who were not even decision makers or influencers. The people who said “yes” to a call were just looking for free information, to network and maybe refer the company.
What good were those leads if no relationship was being created and leveraged to create revenue opportunities? Again, the cost-per-lead may be low but the cost for business growth is high.
Sales Consulting Firm Focuses on Cost-Per-Lead Rather Than Return on Relationships That Will Lead to Greater Revenue
The president of a sales consulting firm almost did not renew the firm’s contract with Get LinkedIn Help because she wasn’t getting the return-on-leads she wanted. She was focused solely on her cost-per-lead rather than the return-on-relationships she was getting.
Through our efforts, the firm was building relationships with VPs of sales and sales enablement directors at Fortune 500 companies like Oracle, First Data and TD Bank. She didn’t think about the value those relationships will have once they close deals. She didn’t think about how we’re shortening the sales cycle and giving the firm a return-on-time.
By focusing just on leads instead of relationships that will turn into revenue, the president was getting a false sense of failure (when she was indeed getting something way more valuable than leads that tend to go nowhere.)
If Your Intention Is to Grow Your Business, Shouldn’t Your Focus Be on Generating Customers and Revenue?
For our own LinkedIn marketing efforts at Get LinkedIn Help, our team does not carry a lead goal. In fact, we don’t even carry an opportunity goal. We only measure marketing success by closed revenue and make decisions based on this metric. Even if we generate a lower amount of leads or opportunities, it doesn’t matter. Our revenue that is coming from our LinkedIn marketing efforts is all that matters.
The way to focus on customers and revenue is to focus on the complete funnel, not just the top of the funnel and the volume of leads that are going into the funnel. Marketers need to take a pipeline marketing approach, make decisions based on revenue generation instead of leads and optimize all aspects of the LinkedIn marketing program to widen every stage of the funnel. The only way marketers will be able to generate more MQLs, more SQLs, more sales opportunities and more deals is to use the entire pipeline.
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So, what are your thoughts?
Should marketers be focusing on the lead volume or should they be focused on the relationships that are being created and how they are driving revenues? Should they be focused on cost-per-lead or the cost for business growth and results?