Generating qualified leads ain't easy. This is especially true for SMBs, which don't have the workforce, budget, lists, or connections to draw tons of sales prospects into the sales pipeline.
Luckily, there's an entire industry out there ready to help.
Sales lead generation companies connect your business to individuals likely to be interested in the products or services your company offers by giving you access to their lists of prospects and contact information or by building you custom lists.
Some lead generation companies even have tools that can gauge a potential lead's interest and score leads according to which contacts are most likely to become customers.
Sounds great, right?
But how do you know which lead generation company to choose? These services aren't cheap. A $1,000 minimum spend is hardly unusual. The wrong choice can waste a lot of your time and money.
Let's dive into what differentiates lead generation companies and how to choose the best one for your business.
Questions to ask when selecting a lead gen company
Before you hand over any money to a lead generation company, you need to ask yourself the following five questions.
1. How fresh, accurate, and complete is their data?
The first aspect that can set a lead gen company apart is how trustworthy their data is.
Old, inaccurate, or incomplete data wastes your time. If you're going to pay for data, make sure you're getting your money's worth.
Ask the company whether their data is verified by humans or just scraped from the web. Then ask how often the data is updated and where it comes from. Potential sources include public records, trade publications, telecom providers, telephone interviews, and print publications.
Since data is their lifeblood, lead generation companies aren't often forthcoming about their data sources. But, they should tell you how often their data is updated and how it's verified.
You should find out how much data you have access to. How many names? Do you know where the person sits in the org chart? And don't forget to ask whether, and how, the data integrates with your CRM.
2. What, exactly, does success look like to you?
What kind of return do you need to make what the company is charging revenue-positive for your business?
First, you need to decide which metrics you need to track. Start by determining what a conversion looks like for your business. It could be anything from a sale to a signup or whatever else you want a prospect to do.
Once you know what your conversion is, you need to know what it costs you. To find this, you need to be able to easily track your total number of leads, cost per lead, and average conversion rate. You may also want to track your customer lifetime value, especially if you're offering a subscription model.
Without this information, it's impossible to know whether you're earning or losing money through your lead generation efforts. It's also much more difficult to become more efficient at generating leads for a lower cost if you don't know what you're paying for leads and what their quality is right now.
3. How will you measure success?
Knowing how many leads the lead gen company brought in and your close rate for those leads isn't helpful if you can measure it only every six months. You need to know what information the vendor provides, how often they provide it, and how easy it is to obtain and understand.
Some vendors offer easy-to-read dashboards. Others make you do some programming to compile reports, which you then have to download as CSVs to read.
Find out what the reporting looks like on the metrics you want to track before you pay.
You know buying bad leads is a waste of time and money. But how can you tell whether your leads are good or bad?
This is where analytics comes in. Does the service offer a dashboard where you can easily track your most important metrics in real time? Or can you at least easily pull these reports? However they do it, make sure your lead generation company makes this information easy to obtain.
4. How available and competent is their support?
When things go awry—and they often do—can you get someone on the phone within a few minutes to help you? Or do you have to make do with live chat or, worse, a forum?
Support availability, friendliness, and competence varies considerably between software vendors. Some companies pride themselves on offering great support. Others see it as more of an afterthought.
To know which one you're likely to get, ask the company in advance what support channels they offer, and get details such as average response times and hours of operation. If possible, read some reviews online to see how friendly and fast other customers found their support to be.
5. What will you do if it isn't working for your business?
Have a backup plan, and put everything in writing. Draw up a service level agreement with your sales lead generation company that gives you as much certainty as possible.
Things to ask for include a certain number of leads per month and a certain conversion rate. You might also want a guarantee that the lists they send you are a certain size, and have an agreed-upon completeness and accuracy.
Another thing you'll want in writing is the level of customer service the vendor provides. Lastly, stipulate in advance what happens if the company fails to provide anything they promised.
Go forth and convert leads
A sales lead generation company can be a great way to skip the long process of calling, researching, emailing, blogging, and everything else required to generate custom lists of prospects and turning them into leads on your own.
Often, outsourcing all—or even just part—of this process can save you time and money in the long run.
The key to ensuring that you make money by engaging such a service is going in prepared, asking the right questions, and getting everything in writing before you pay.
Another way to efficiently capture and convert leads is through lead management software. You're less likely to lose key pieces of information with all your lead data in one place, and fewer leads fall through the cracks when you have reminders popping up to tell you when to follow up.