By: Patty Azzarello, president, Azzarello Group

Big Help for Small Business: How Companies Waste Leads

I have worked with many different sized companies and one of the universal truths I have seen is that sales people basically hate leads that are generated by marketing.

Unless of course, the prospect has money that he will lose if he doesn’t spend it today, and he is calling you to place an order.

Sales people only like HOT leads.

I don’t say this to take a shot at sales people. Effective sales people do a heroic job of cultivating their own business, and getting their own leads based on referrals.

Warm or cool leads generated by marketing by comparison are viewed as “action items”, which get in the way of developing the business they are working on.

So why bother generating leads?

If you are in the marketing role, generating leads is built into the DNA of your job description. It’s also makes for a clear measurement: how many leads did you generate and how much did it cost?

The basic goal is to spend the right amount of money and generate high quality leads that sales people use and turn into business.

The real goal is to leverage that same marketing investment to generate more HOT leads.

I have seen two basic practices make a huge difference.

Don’t Throw Away Warm Leads

This is one of the most well studied and most ignored marketing practices.

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By: John I. Todor, Author of Addicted Customers

Put Your Offering in Context—One Meaningful to Customers

Declining profit margins and limited customer loyalty, these are common concerns of many businesses. When customers treat product like commodities and shop on price or convenience they force businesses to aggressively compete with each other. Unfortunately, this just exacerbates the situation.

How can a business differentiate on value, keep margin high and win customer commitment? Decommoditize! Put their offering in a context that is meaningful and valuable to the customer.

What is context? Context is the interrelated conditions or situation in which something exists; the circumstances that define meaning or value.

How can a company put their offering in a context that is meaningful and valuable to customers? By looking at the offering from the customers’ perspective. 

Mimeo.com is a great example of a company that did just that.

Mimeo.com sells printing. In most instances, printing is a commodity. Printers compete on price. Most printers are struggling and in recent years many have gone out of business. Yet, Mimeo.com has been very successful.

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What the CRM Experts are Talking About

What’s the latest in customer relationship management?  The leading industry analysts are saying the following about the most current CRM techniques and trends:  

CRM applications and related customer service processes continue to stay among the top five critical priorities for CIOs.  Interest in CRM solutions remains very high within corporations, government agencies, and higher education institutions alike.
 - 2007 Gartner Survey 

“Lagging indicators in monthly reports do not give companies the type of customer data that they really need to make decisions.  It’s in predictive indicators and real time analytics for decision-making that the real benefit lies.”
- AMR Research Report on Customer Analytics

The growth for hosted CRM continues at a rapid pace, with an estimated 76 percent of overall expansion in the industry expected to come from on-demand solutions.  Revenues for this segment of the CRM market will top $3.6 billion by the end of 2008.
 - IDC

The CRM market was quite strong in 2007.  By year end, total sales are expected to hit nearly $74 billion.  Software applications represent approximately $21 billion of that number, with services making up the rest.
- Forrester Research

Fastened to the Future

For most consumers, the fastener aisle at the local hardware store—with its hundreds of screws, nuts, bolts and washers— is daunting enough. For Uneeda Bolt & Screw Company, that miniscule inventory hardly represents a sample.

Family-owned Uneeda Bolt & Screw was founded in 1954 in a New York City sub-basement. In its current 40,000-square-foot warehouse just across the Hudson River in New Jersey, the company is a one-stop supplier for more than 4,000 commercialcustomers. The company sells more than 80,000 specific items, adds 30-50 new items every day and carries an inventory of more than six billion quality fasteners.

In addition to being an authorized distributor of premium brands like Apex, ACT, POP, Marson, Recoil, Brass Craft, Heyco and DTI, the company has built its reputation on the ability to produce custom products in virtually any quantity using any material. Its computerized system can match all painting and powder coatings, and its electronic bagging and boxing equipment can create a wide variety of customized packaging, including instruction sheets, custom labels and bar codes.

“It’s a very complex business,” said Ron Tantillo, the company’s Director of Sales. “It’s not just ‘Here’s a screw.’ There may be two different screws and the only difference between them is the spacing in the threads. That’s a huge difference.”

Falling Through the Cracks

Managing a business this complex takes an extraordinary amount of attention to details. When Tantillo joined the company, he realized the CRM software the company was using was not up to the task.

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Jim Ward - President, BrainSell

What’s a Hybrid CRM Solution?

It’s the best of all worlds. Hosted and on-premise customer relationship management software. In fact — it’s the new market trend.

If you’re looking for are looking for the benefits of a hosted CRM solutions, such as low IT resource requirements and low cost of ownership, but you’re concerned about the security of your data (and you should be) since recent phishing scams have attacked some of the most well know pure hosting solutions, then a hybrid CRM solution is probably what you’ll require.

A hybrid CRM solution provides the ability to go with a purely hosted option, however it will also allow you to purchase the software and install the web solution on premise. Pure web solutions, like SageCRM, are easy to maintain (no client installs), can be maintained remotely by a business partner, and the total cost of ownership is so much lower than a monthly hosting fee. Do the math and you’ll likely find that in 2 years of hosting fees you’ve probably paid for the purchased system 2X or more depending on the size of your implementation. The cost of hosted CRM is one of the reasons why hybrid CRM is fast becoming the market trend.