Last updated on April 19, 2017 in Growth
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I run a business that helps agencies and consultants get more clients. When people ask me to describe it, the easiest way is “lead generation for marketing agencies and consultants”.
I hate lead generation as a concept though because it a) can mean so many different things, b) it’s like middle school sex in that everyone thinks they know what it is and that everyone else is doing it (well), and c) everyone always wants more of it.
It’s that last part that bugs me, because everyone thinks that more leads is better.
I’m here today to tell you that more leads is NOT always better.
What you need is better leads that convert into clients.
If you have zero leads, you need more. No question there.
But if you have 10 leads coming in and you’re closing 1 of those on average, you need to instead focus on closing more of those into clients. This starts with looking at what the leads are, where they are coming from, and why you are not closing them.
From time to time agencies I have on Credo cancel their subscription. When I get an email like this, I’m not even mad:
And why not? Because their expectations are obviously mismanaged, even though I explain to them on the initial vetting call that they should base success with Credo off two things:
Services businesses are very very different from ecommerce or software because there are many factors at play:
Even if your sales process is nailed down and you know that you can close the right clients when you either want or need to, there are always going to be some that never sign for reasons that are completely outside of your control.
Even if your account management is perfect (it never is) and your results are industry-leading (and they never are for every client), you’re always going to lose some clients for reasons also completely outside of your control.
So do you need leads on potential projects for your services business? Absolutely.
But if you’re not closing the leads you’re getting, something is broken.
I’ve talked to so many agencies and consultants over the last 18 months that I’m probably one of the most connected people now in the SEO/digital marketing consulting space, at least with agencies who handle a lot of SMB clients.
Often the first question I get is “how many leads am I going to get?”
My response to that is “How many are you currently getting and how many of those will you close?”
Because how many leads you are going to get is the wrong question to ask.
I spoke with an SEO agency once who was getting 300 “leads” a month. How many clients did they predict they’d get from those “leads”?
To them, a lead was an email and a first name. From there they had to qualify down to if the person was ready to buy, what their budget was, what team the potential client had in place, and more.
Of the 300 “leads” they received, maybe 20% (60) would be qualified.
They’d close 2.
These guys didn’t need more leads. They needed fewer and better leads so that they could focus their time on closing the ones that were actually going to convert and be successful clients!
I was recently in Mexico with some agency owners. One of the agency owners, within the span of two days being there, lost two small clients who were a total pain to and a time suck for him on sales and his team on delivery. Both clients said “we’re going to go another direction.” He said “great”.
The next day he got a lead (a real lead, more than just a name and email) with a budget that is 3 times what the two clients who just left him were paying.
The same logic holds true for volume of leads. If you’re receiving 100 “leads” a month but don’t have a way to prioritize them and thus are spending too much time on low quality unqualified leads and also not enough time on the quality ones you want as clients, then you’re doing yourself a disservice.
Cut back on the noise, increase the signal, make more money.
This is the dream:
To get more qualified leads, work less, sign more, make more money.
The digital marketing world is SO obsessed about making numbers (any numbers) go up and to the right. Unless it’s bounce rate, in which case you want that down and to the right. Graphs are hard.
Anyways, quantity of leads is the wrong metric. If you’re doing “lead gen” for your clients and losing them, you might want to take a look at the metrics you are reporting and being measured on.
I have a friend whose main cash cow business is generating potential leads for lawyers and loans. Every month, he takes 10% off the month’s cost (he sells each lead individually) because he knows about 10% of them are junk and will not turn into a contact/potential client.
When speaking with someone who does lead generation, I encourage you to do a bit deeper of research and learn not only how many “leads” you might get per month (and deeper than that, what information each of those contains), but also how well those close for other people into projects.
A general rule of thumb is:
Most services companies I see who rely on “lead generation” to build their book of clients and therefore their revenue don’t usually need more leads.
They need to take a look instead at their process for generating, qualifying, and closing projects and fix that.
Otherwise you’re just filling a leaky bucket, and guess what?
You have to keep filling a leaky bucket, pouring more and more into it just to keep it at the same level.
As you get more into the bucket, that leak then becomes worse. You might go from a small leak to a full hole in your bucket.
I’m not in the lead generation game. In fact, I dislike the term and I dislike the lead industry because of its focus on volume. Always more. It’s like a drug.
Yes, projects created on Credo have grown well over the last 18 months:
But I implore you – take a step back and look at your funnel.
Take a look at the projects coming in. Are they the kinds of projects you take?
Take a look at how well you move projects from intake to first contact to vetting to proposal to close.
How well are projects closing?
Here’s how I set up a flow for agencies who have asked me:
That screenshot is from HubSpot’s CRM, by the way. It’s free and there are a decent few integrations built as well (Zapier has a bunch).
Before going to get more projects, from me or someone else, first do yourself a favor and get yourself this insight into your funnel:
Most websites these days don’t need more traffic. There are sites that do (especially sites that sell advertising or products), but many of them would also do well to look at their conversions and focus on closing more of their visitors into people who actually pay them money. Not just another number in an email list, but actual cold hard revenue in the bank.
Do yourself a favor and turn down the lead volume. Fix your leaky bucket and make more from your current efforts before you try to crank up the top of the funnel.
This will serve you better long term anyways, because once you do increase the numbers in the future you’ll scale your business even faster.
Sometimes the hardest part of growing your company is finding the right tools to use to execute on your strategies. Tools are a dime a dozen, but the right tool for the job is hard to find.
Check out our recommendations for lead generation and SEO tools as well as the books we recommend reading as you grow your business.