Why Lead Generation Will Make or Break Your Business (part 1)
I was in my 4th year (out of 25 years) of being a business owner building a technology temporary staffing company. My business was really growing. We had gone from zero to over $3 million in revenue per year and at that point, like most small businesses, it was time for me to stop being the rainmaker and for me to hire salespeople. I had no other method of getting clients other than through salespeople.
When I knew that Lead generation was more than just sales people making calls
I was in my early 30’s having been one of the top sales representatives for a major corporation (Xerox) for 8 years prior to starting my business but when it came to hiring, I hadn’t done much of it at Xerox so it doesn’t surprise me looking back that I made every mistake you could think of. To be fair with myself, I was also trying to find rainmakers as good as me with a limited budget in a field that very few people had any experience in. The sale wasn’t an easy one to boot. It was after numerous failed hires that I learn one of the most critical lessons that 20 years later, still drives where I spend 80% of my time, lead generation and I am not talking about me or others making sales calls.
I learned then that if you have a good lead generation process, one that brings in prospects to become clients economically, that it will allow your business to become less reliant on your people, your current salespeople will be more successful, you will not have to pay your salespeople as much as other companies and more importantly, YOU will control your success.
The Majority of your day should be spent working on lead generation
However, from the 100’s of small businesses I have met, not one of them spends as much time and effort as I do making sure they have a measurable and successful lead generation system in place. I believe in my heart that business success is driven by its lead generation process and over the years, I think that attitude is why I have built very profitable businesses. If you have a poor or nonexistent leadgen process for your business, then you will always struggle.
If I were to ask 100 business owners today what their lead generation strategy is, 99 of them would say their salespeople IS their lead generation strategy. I have become an evangelist. If you also add the fact that most small businesses get 80% of their business from only a few clients who can easily leave, it proves that a successful ledgen is even more imperative.
What is lead generation
When I talk about lead generation, what I am talking about is a strategy to drive PROFITABLE clients to you through some form of advertising. This would be through advertising methods such as:
- Search engine paid for search
- Search engine organic search
- Display advertising
- Direct mail
- Trade advertising
- Print advertising
- Social media
- Strategic partners
- Email marketing
- Trade shows
- Reference selling
- Affiliate marketing
- And many more
What does it cost you to get a client and how much money do you make
Maybe these strategies above seem obvious to you or maybe not, and you probably have tried some of them but if I asked you what does it cost you to get a client and then how much money do you make from that client, would you have that figure at the top of your head even if all of your leadgen is from salespeople or you? I can answer that question (the cost to acquire a client) with all of my businesses because I work on leadgen strategy and measurements daily. In fact, I would say that the majority of my day is spent in this area and it is because of that, that I feel I have 100% control over our success allowing me to build several profitable companies.
But it is about delivering great service or products
Some of you might say that I am wrong and that you have to deliver exceptional service or a fantastic product to be successful. I am not suggesting that isn’t important but most small businesses think about delivering great service/products first, or even only, and to me, that is only 50% of your success. Clients will come and go for reasons outside of your control, employees will leave or be fired, but what will not leave you is if you can figure out how to get new clients inexpensively when your competition can’t. In fact, you show me a business that failed and I will show you a business that never figured out how to get clients economically.
This isn’t easy
I am certainly not saying this is easy and if it was, I wouldn’t spend the majority of my day on leadgen but what I am suggesting is that business owners need to spend a lot more time figuring out how to successfully get new clients, what it costs to do this, and how much you make from each new client. Let me also be clear, I rarely make any sales calls myself instead of spending time getting leads to come to my sales team through advertising.
Many of you might be thinking where do you find the time and my feedback to you is that time management is always about prioritization and also about what you like doing. I have always done a good job of delegating and freeing up my time to work on the most important projects to drive my business success. It certainly doesn’t hurt that I really enjoy leadgen strategy but even if I didn’t, it would be on the top of my list of where I have to spend time. Let’s be clear, leadgen is really, really hard and it will not come to you overnight!
Spend 90 minutes per day on big projects…hopefully lead generation strategy
One of the time management strategies that has really helped me is that daily, I budget 90 minutes in my day to work on special projects and often those projects revolve around some type of new or improving leadgen strategy.
So if you can’t tell, I really believe that the number one activity that every small business owner should do is focus time on building the best lead generation strategy in your industry. Your business might not dictate spending as much time on it as mine does but focusing on bringing on new sales is time well invested. You might need to change your thinking about where to spend your time but if you do, I guarantee your company will achieve the success you are looking for.
This is the first of several articles that will be related to various lead generation ideas. Part 2 can be found here.
Author, Stephen Halasnik is a serial entrepreneur having built 7 successful businesses in the $5-$20 million revenue per year range over the last 25 years. One of those companies was on the Inc 500 fastest growing list. His latest company is Financing Solutions (www.financingsolutionsnow.com) which provides Lines of Credit to small businesses and nonprofits throughout the United States.