When is a sales prospect not a prospect? We just posted Making Lead Generation Make Sense at our other blog and it was syndicated at Customer Collective. That was nice, but even better, two sales and marketing professionals took the time to comment.They both made the same point. They didn't agree with me :+(
The central topic was a common misunderstanding about what constitutes a prospect. Typically Marketing and other lead generation services like to attach the Prospect label to any name and number they come up with.
Sales professionals on the other hand use a different language. For them a Prospect is somebody who's been qualified as a potential buyer. That is, somebody with an active project, and budget, and some sense of how they'll select a vendor.
Where's the problem with that, you might well ask. After all sales guys are supposed to push their way into peoples agenda and pitch their wares. Surely a name and number is just the start of the process?
That's pretty much what the comments said. And it demonstrates how little those guys know about sales operations. And that's where the problem lies.
Businesses need sales forecasts in order to plan revenues, expenses, cash flow, and delivery resource. Sales forecasts are based on lists of prospects. The sales manager's job is making sure those prospects are really opportunities to make a sale, at a given price and within a given time frame. For a potential sale to get on that list the sales guy has to do a lot of work.
Of course some of those prospects will have come out of the lead generation program, which in part justifies Marketing claiming the names it comes up with are all Prospects. The trouble is most of the names collected never make it on to the sales forecast - because they aren't prospects. They're just names and numbers.
There's obviously a conflict between sales operations and marketing which surfaces in the CEOs review meeting.
Picture this scene.
The CEO asks VP of Sales for his forecast sales for the quarter. The number he's given disappoints. He's already promised the analysts growth on last quarter's numbers but that's not going to happen. In fact the business might actually go backwards.
"What's gone wrong" he asks "and what are you doing about it?"
"We don't have enough prospects" responds the head of Sales.
"That's ridiculous" interrupts the VP Marketing "We've passed on to you more than 500 Prospects, this month alone".
"They turned out not to be prospects" replies the Sales guy. "Either they didn't return our calls, or they had already bought from our competitor, or they didn't need what we sell, or they didn't have any money".
"OK cut the hard luck story" the CEO intercedes. "Marketing is only there for brand building. They ran the lead generation program to help you guys out. If those sales leads were no good, why haven't you been out on the street finding your own prospects, like a proper sales force?"
"We've been too busy chasing those 500 leads we got from Marketing" replies the VP of Sales.