Tried and Tested Lead Conversion Formulas May Need an Update

Renee Yeager - June 23, 2009

One area that we specialize in is demand generation programs.  Everyone at our firm has done them for years using a variety of methods, and we’ve had lots of fun debate on the merits and flaws in each. Overall we’ve found that campaigns leveraging a mix of online and offline components are by far the most effective. 

It’s been interesting to see how the economy is impacting a program we just wrapped up with a large technology company.  To date, our tried and tested formula has been that starting with a halfway decent list, you will lose about 20% of the contacts for reasons like acquisition, out of business, etc. From there, we typically reach between 40% to 60% of the contacts (whether by open rate, phone conversation or another measurable touch point) and convert to lead anywhere from 2% to 10%.  These are numbers that from experience we know are achievable for us and on average we land around the 7% mark. 

With this recent campaign, it’s a different story—we were able to achieve our goals, but in a notably different way. Instead of reaching 40% to 60% of our targets, we only connected with about 15%. Here’s the interesting part: we’re converting over 20% of those we reach to a qualified sales opportunity. In this case, these leads are viable opportunities where we’ve confirmed by phone with a decision maker that there is a project is in place, budget is approved and they want to speak with a salesperson.

These results support the notion that there are definitely fewer companies spending on technology projects, but the ones that want to spend are ready. Are they ready to benefit from better, more flexible pricing options? Seems likely. Ready to get an advantage over competitors who might not be so forward-thinking? Possibly.

As part of the lead management process, we’re working to get a better insight to explain what’s happening; if you’re interested, I’d be happy to share our findings. If you’re having a similar experience, we would like to hear about it.