ADOTAS – Companies with closely-aligned marketing and sales departments close 38 percent more proposals than non-aligned companies. Wouldn’t we all like those kinds of results? Many companies are working hard to align their sales and marketing efforts. With this comes a whole slew of industry terms such as lead scoring, lead qualification and demand generation. Marketing thought leaders, such as marketing automation vendors, tend to throw around these terms without explanation. It’s a bit easier to understand what marketing automation software can do for you if you understand these terms and concepts. To help you get started, here are nine terms every marketer should know:
1. Marketing and Sales Alignment
Traditionally, marketing sees the world through a buyer’s viewpoint, and sales through the seller’s lens. There can be huge gulfs between them. But both departments share the same ultimate goal: to produce revenue for the company. Marketing and sales “alignment” is a process, or the result of a process, that creates mutual understanding and a partnership mentality.
2. Demand Generation and Lead Generation
The concepts of “demand generation” and “lead generation” are often used interchangeably. There are no standardized definitions of the terms, and some practices can be used to support both. We asked marketing expert David Raab from Raab Associates for his personal definition of the terms. He responded, “”Demand generation’ classically means to actually create demand for a product by educating potential buyers about why they need it and who they can buy it from.” Generating this awareness and interest can involve a wide range of activities, including magazine, TV, radio advertising, direct mail, email and all kinds of inbound and outbound marketing activities, such as sign-up opportunities for email newsletters, webinars, whitepapers, e-books and so on.
“’Lead generation’ is a narrower term,” advised Raab, “involving getting potential buyers to identify themselves and agree to be contacted by the company — to, in effect, ‘raise their hands.’” An example of lead generation is advertising that draws people to a website where they can indicate strong interest or receive something of value (a newsletter subscription, webinar registration, etc.) by providing some form of identification, usually an email address at the minimum.
An offline example of lead generation could be something as simple as people putting business cards into a fishbowl in hopes of winning a prize. All those business cards are leads – with name, company, phone number, email address and more.
3. Lead Qualification
People identified as leads will be at different stages of readiness to buy, from just beginning their research, to being ready to buy as soon as they get the right offer. Lead qualification is a process for determining which stage a lead is at now, so that the prospectcan be sent the correct offer at the right time to move him or her closer to a purchase.
4. Lead Scoring
Some companies find it useful to qualify leads with a ranking system that tells salespeople how close each lead is to a purchase. That helps the company decide which offer to put in front of the lead next. It also helps sales professionals prioritize their time by focusing on the hottest leads. Usually the ranking is an aggregate of scores earned through prospect behavior such as click-throughs, website visits or webinar attendance.
5. Lead Conversion
Lead conversion is the term used to indicate that a buyer has taken a step in the buying journey. For example, depending on your organization’s terminology, a prospect could convert to a lead, a lead could convert to an opportunity, an opportunity could convert to a sale, and so on.
6. Drip Marketing
Drip marketing is the practice of sending messages and offers on a schedule, “dripping”out over time. With marketing automation, you can create a drip program that triggers in response to a specific action by a prospect.
7. Lead Nurturing
Lead nurturing is a specific type of drip marketing. If someone isn’t ready to buy right away, but has expressed interest, it’s a rewarding practice to keep “touching” the lead with new information or offers. Nurturing uses scheduled drip communications to keep your brand top of mind with the prospect until they’re ready to buy.
8. Lead Management
While the concepts of qualifying and nurturing leads are fairly simple, execution is not. The typical marketer is managing multiple segments, multiple campaigns and different offers across multiple channels. That’s where marketing automation comes in, with lead management tools including list segmentation, scoring, nurturing and more – to help marketers ensure that no lead gets dropped or abandoned, and that every lead gets theright communication at the right time. This not only increases conversions throughout each stage of the sales funnel, but lowers the cost per lead. It can also help document how marketing campaigns contribute to closed sales, demonstrating marketing attributed ROI.
9. Marketing Automation
Marketing automation software provides an efficient way to manage demand generation and leads, and communicate timely information with the sales department. Marketing automation systems allow a company to identify leads from the outset, gauge their readiness to buy, automatically send each lead offers that will help move them closer to a purchase, and automatically alert sales to qualified opportunities. In short, it creates greater sales and marketing alignment, and results in greater sales.