Outsourcing Lead Generation
How can you tell if you’re outsourcing lead generation to a professional or to a con artist?
Lead generation takes a long time to work. By the time you know whether or not you’ve been outsourcing lead generation to a company that can’t do what they’ve promised they can, you’ve probably burned a year of your marketing budget.
You’ve wasted your money.
You’ve soured your market through never ending emails, cold calls and direct Linkedin mails that resulted in elevated spam scores, blocked profiles online, blacklisting and blocked phone numbers.
Once you’ve burned your market with bad outreach, it can take years to recover. If you recover.
Outsourcing your lead generation too early can stop you before you even get started.
There are a lot of outsourcing lead generation companies who don’t seem to generate anything but invoices.
How do they stay in business?
- Non-disparagement clauses
- Prohibitively long contracts and litigation
- A steady stream of new entrepreneurs who haven’t done any research
How Do You Tell The Good From The Bad?
It’s not easy. We’ll try to give you some reasonable advice here – but the best advice I have is to treat outsourcing lead generation like gambling. If you can’t afford to lose the money – all of it – you shouldn’t be outsourcing lead generation.
What Are You Buying?
MQLs – or “marketing qualified leads” just aren’t worth buying.
“Marketing qualified” means “all the work to get the meeting is transferred to the customer.”
SQLs – or “sales qualified leads” may be a better investment, so long as you and your provider have the same definition of “sales qualified”.
There are only three types of leads that outbound lead generation produces, and none of them turn over fast. (Read about those leads in this blog post.)
If you’re in an industry where three-year contracts are the norm, the odds on any of your leads being “sales qualified” without you having to spend time nurturing them after the first sales appointment are almost zero, so you need have realistic expectations about your results. Nobody is getting you sales appointments that are going to close tomorrow. Outsourcing your lead generation likely won’t produce much return on your investment in the first year.
A good lead generation firm will be honest about the speed with which your campaign will work. Hint: it’s over a year for most marketing investments to produce R.O.I.
They should be able to clearly outline what “qualified” is – and you should be able to decline to pay for the meetings that don’t meet that parameter – and if you’re paying a flat rate with no guarantee, you should ask a lot of questions about what exactly the company is doing for you.
Lead Generation Considerations
An industry-specific firm should understand you and speak your language. If you use a common abbreviation or initialism and your marketing firm doesn’t know what it means, that’s a red flag.
When it comes to lead generation, there is no “set it and forget it” solution. We wish there was, but even managed marketing providers need guidance and feedback that most of the time, their clients do not know how to provide.
We recommend not outsourcing to any company that demands a recurring monthly fee until your business is generating at least 2M in annual recurring revenue, you are paying yourself at an industry average rate or higher, and your EBITDA is industry standard or better.
Here are the steps you should follow on the path to outsourcing your lead generation:
- Pay yourself first. An industry-standard CEO level salary.
- Build up a prudent business cash reserve.
- Save some cash for the future – nothing is certain and a personal emergency, health scare or divorce could require liquid cash.
- Master service delivery: “Nail it, then scale it.” Most people go looking for outsourced lead generation when they have a client retention issue – you can avoid needing lead generation support entirely by investing in your service delivery.
- Use inexpensive lead generation options like asking clients for referrals and networking.
- Then, and only if there’s any cash left and you’re debt free, consider investing in an outsourced lead generation agency.
So where should you invest some marketing dollars if you’re not at the magic number?
Here are my suggestions:
- Buy sales training – not on a recurring model. Just take an online course or buy a few hours of training. (Or just consume some of the many many many hours of free content available on youtube, or through any free learning platforms!)
- Hire a contractor to create social media templates and stick to a regular posting cadence.
- Network, network, network.
- Join your local chamber of commerce, or a BNI group. Stay away from “mastermind” groups featuring motivational speakers or marketing gurus.
- Join a Goldman Sachs 10,000 Small Businesses Cohort, or an SBA Interise Program.
- Find a mentor through the SBA Score program, or start talking to peers about mentorship.
- Join a peer group!
- If you’re in the I.T. space, I recommend checking out ITNation Evolve or Taylor Business Group.
- If you have an EO accelerator in your town, check it out!
- Seek out your local economic development agency and look for opportunities to provide services to the companies receiving grants, awards and seed funding from government agencies.
- Invest in a marketing system that you can use yourself
Richardson & Richardson Consulting has created a marketing system that is customized, installed, documented and trained. We’ll support you through your first 12 repetitions (from first outreach attempt to completed FTA) and then hand you the keys. This reduces your overall marketing spend and reduces your cost per lead, cost per appointment, and cost of acquisition.
However, it’s important to note that this marketing system can only be used peer to peer. Business leaders don’t want to talk to your junior marketing intern or sales rep. If you’re not ready to do the work yourself, this system isn’t for you.
If you’d like to learn more about it, first make sure you have a solid business strategy that includes your marketing goals, budget and target client profile. Fox and Crow Group can help with that!
Then schedule some time with Carrie to review your goals and see if her Croocial Co-Star marketing system might work for you!
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