Sales Advocate Newsletter

Automated Lead Management For Partners

April 2002

Every year, millions of dollars are spent on advertising, websites, tradeshows, seminars, promotions and other marketing activities to create demand for business partners. As a result of this investment, thousands and thousands of sales leads are generated. In fact, leads have become the common currency of successful channel programs, and many marketing departments are measured by the volume of leads they produce. When asked, vendors often report that they believe they’re doing an excellent - albeit expensive - job of providing the leads their partners want and need because the number of leads going into the pipeline is high.

However, according to research, when these expensive leads eventually end up in the hands of partner salespeople, they are largely ignored. Sometimes the leads are so old that by the time the prospect is contacted the initial interest has evaporated. Most often, however, the customer is never contacted at all! And yet, when research is conducted with business partners, they always say they want more leads from their vendors. Where is the disconnect?

The problem has more to do with the manner in which vendors commonly set up and manage their lead management activities than it does with a lack of interest on the part of partner salespeople. Most vendors have not changed the basic and inefficient lead flow processes since lead programs were introduced into high-tech channels two decades ago. Worse still, conventional lead routing concepts have been automated into most Partner Relationship Management systems and other partner program automation projects. In other words, the manual inefficient lead process is fast becoming the new, highly-automated, and inefficient lead process.

In most companies, leads are created and then “pushed” out to sales partners. However, pushing leads is like pushing rope - it is not effective. Marketing people spend a lot of time and resources creating, qualifying, and categorizing leads - and then trying to allocate these leads to the specific partner that may have the best chance at closing the business. Usually, as a general policy, direct sales or the top partners get most of these leads. It is not very scientific, although elaborate algorithms are often developed to make sure that leads get routed to the designated recipient. Still, with all the work, the results are dismal.

If a vendor has a robust partner program (500 resellers and 2,000 leads every week), it is impossible to push each individual lead to the most appropriate reseller at any given time because no one can predict which resellers are motivated to follow up with the lead on the day that lead is received. As a result, leads are processed to the largest or closest partner geographically, regardless of their interest or ability to follow-up. Still, despite this disconnect, leads automatically keep flowing out to the same resellers every week.

According to Blue Roads Corp, a leading supplier of stand-alone lead management systems for high-tech vendors, 50-70% of all leads generated by vendors get lost in this “push” process, meaning prospects are never contacted by a salesperson. (Significantly, many leads generated by web site visits never make it into the lead distribution process at all.) The remaining leads are often contacted two or more weeks after the contact was made. By then the prospect doesn’t even remember what their interest was or why they visited the web site or trade show booth in the first place. Only 5% to 10% of leads actually get contacted fast enough to end up in presales activity.

The lead management process has become one of the biggest bottlenecks in the sales organization. For the majority of vendors, the program is considered a success if partners can turn 0.2% of all the leads generated into customers. However, they rarely know if even this meager objective is achieved because asking a partner for feedback on the leads is a big problem. Vendors hope that partners follow up the leads, but they have learned not to ask for much information about this follow up. Partners do not usually report back on their activities, no matter how much they are threatened or incented to do so. True “closed loop” systems are extremely rare.

Now there is a different way to manage these leads. Rather than pushing them to channel partners, leading-edge channel managers are moving to new Internet-based technologies that turn everything 180 degrees. Leads are posted on their partner extranet, and authorized individuals or partners can “pull” them down when ready. With this upside-down “pull” methodology, everything changes. (In fact, it is so different that Blue Roads Corp is in the process of patenting parts of the process.)

With a “pull” system you don’t have to match partners with prospects (no more distribution algorithms). Salespeople only claim leads when they have the time and inclination to pursue the opportunity. Also, since the system knows who (exactly) pulled each lead, the system can follow up and immediately (within minutes) introduce the partner salesperson to the prospect electronically. The prospect then knows that he will be contacted - and even who is contacting him.

The results of that eventual contact can now be fed back to the system because new leads can only be claimed if feedback is given on the previous leads. So feedback on each and every lead in the process is highly likely as long as salespeople want access to new leads. Moreover, if no feedback is given within 24 hours, the system can assume that no contact has been made and make that lead available to another partner. Not every salesperson can pull down every lead. Vendors can categorize leads (highly qualified, Fortune 50, legal market, etc.), and authorize partners to only pull down the leads that match their qualifications.

All in all, the “pull” concept usually puts more leads into the hands of the right salespeople at the right time. And vendors get better feedback on what is happening so they can calculate more accurate returns on their various marketing investments. This is the kind of leveraging that can happen with the right kind of automation planning and implementation, but it only happens when distribution managers are willing to give up old ideas and use the Internet more aggressively.

Is your distribution program ready?

This article was originally published by Technology Channels Group, Inc. an expert in high-tech partnering. Whether you require a partnering strategy audit, joint sales planning with partners, program development, or basic partnering education and best practices, Technology Channels Group can provide professional assistance. For more information, or to register for our free newsletter, visit www.tc-group.com.

This newsletter is provided as a complimentary service from Phone Works, Inc., the San Francisco Bay Area’s leading sales consulting firm. Phone Works helps technology firms increase revenue, shorten sales cycles and implement successful, repeatable sales models. The industry’s largest technology companies and newest start-ups turn to Phone Works for lead-generation, lead-qualification, telesales and sales-productivity programs.

You can reach Phone Works at 510.749.9073.