Tough going tracking ROI on Lead Generation programs.


The following interesting post, authored by Kate Maddox, was recently published by BtoB Magazine. (Story posted: January 3, 2008)

Villa Park, Calif.—A new study by the Sales Lead Management Association (SLMA) found that 82.8% of small businesses do not track ROI on lead generation programs. The study was based on an online survey of 144 small businesses in California, conducted in December by the Velos Group and SLMA. It found that 52.4% of companies surveyed have no formal sales forecasting process in place. Of those that do, Microsoft Excel is the primary tool for compiling forecasts (cited by 21.7% of respondents).


I wonder if it's any better in large companies? eti’ Sales Support's experience is that most companies make a rather weak attempt to track ROI ... and rationalize their results in all kinds of ways  to justify their expenditures.  Few however, really measure ROI as it should be done by taking all the costs of a lead generation activity into an account. 

One example that springs to mind is Trade Shows. 

We have a major client who invests millions every year in all types of Trade Shows.  Although some value is derived in terms of qualified leads, the cost of identifying these opportunities is simply off the wall because only a small number of attendees represent real "sales ready" potential.  (The conversion rate is usually about 3% compared to organic inquiries - i.e. inquiries from general sources such as your website - that convert at 40% or more).  

The cost of the actual Trade Show - including the cost of lost productivity and lost sales opportunities (because sales staffs are at the Show and not in the field selling) is not taken into account.  And because (in some cases) the costs of building the booth are handled by another department, these costs are not included in the mix either. 

So the long and short of it is the client is probably losing tons of money.  (I suspect the PR department can probably justify the investments.  But they are not in the lead generation business.)

Another reason many companies do not track ROI effectively is because many products/services have extended sales cycles.  If the average time to convert a prospective new customer takes a year or two – back- tracking the revenue to marketing activities a year to two old becomes difficult. (Many Campaign Management packages don’t manage this process effectively.)

Additionally, if you sell via a channel, getting your partners and VARS to report sales back to you is tedious and expensive.  Even if you do it well, it’s unlikely you’ll get the feedback timeously so that ROI can be fully updated for correct calculation - whenever you need it. 

Although the technology for Partner Relationship Management (PRM) systems has been around for years, few companies actually use them; with the result partner reporting is spotty at best.  And the lengthy sales cycles make this model both difficult and cumbersome to manage.

Because all the facilities we use at eti are tightly integrated, we provide real time ROI calculations via our Marketing Performance Dashboards.  Our lead generation, lead qualification services and i*collaborator platform enable you to measure all the activities from the top of the marketing funnel right through the sales and nurturing processes.  And we provide an easy to use infrastructure to make it all happen. 

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eti Sales Support’s solution is well worth considering. You get valuable experience in Lead Generation, Lead Qualification, and cumulative ROI reporting for as long as it takes. Feel free to call and discuss how eti Sales Support will help you maximize sales. 

Michael Falkson

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