| Few marketers will question the value of sales | | | | Each consultant would keep prospect records in |
| leads generated by direct mail and other direct | | | | his own unique filing system. When he was |
| response methods. However, a poorly integrated | | | | promoted or left the company, there was little |
| lead generation programme can actually reduce | | | | organised prospect data to hand over to a |
| the overall productivity of a salesforce. | | | | successor who had, time-consumingly, to build up |
| This is a true story and only the company name | | | | an entirely new prospect bank. Clearly, a method |
| has been changed | | | | was needed of recording prospect data centrally. |
| The case of Newco & Co. illustrates the | | | | In addition, the rapid success of the national |
| phenomenon. Newco manufacture a range of | | | | accounts function required a database to accept a |
| specialist industrial washroom equipment; they | | | | great deal of account information, e.g. subsidiary |
| offer service contracts to maintain the equipment | | | | companies and trading terms, in order to |
| and supply their wide range of hygiene disposable | | | | coordinate account management. |
| products. | | | | On the marketing side, there was the need to |
| The market combines extreme competitiveness | | | | build and regularly update the unqualified lead |
| with a marked lack of glamour; therefore Newco | | | | element of the database. Most mailing lists contain |
| have chosen to dedicate a specialist salesforce to | | | | little prospect information and generally age at |
| concentrate on opening up new accounts - to be | | | | between five and 15 per cent per annum. For |
| subsequently serviced by their operations division. | | | | Newco's database considerably more information |
| Their objective with this structure is to obtain the | | | | than name and address was required for each |
| widest national distribution for their equipment | | | | listed company: e.g. Telephone number, key |
| (which includes dispensing machines). The bigger | | | | decision maker, number of employees and |
| the 'population' of their equipment, the more they | | | | existing products/brands used. This degree of |
| sell of consumable hygiene products - the major | | | | detail effectively doubled the potential for decay. |
| profit opportunity for their business. | | | | Setting up the database and its management |
| The salesforce of 50 specialist equipment | | | | systems required a great deal of investment in |
| consultants and key account executives is divided | | | | specialist software. Hardware was not a problem: |
| into eight geographical regions, each managed by | | | | the company already had sophisticated computer |
| an area manager under the control a national sales | | | | hardware and had invested a considerable amount |
| manager. In the course of many years' | | | | on computerising its internal systems. However, |
| experience in direct marketing Newco have | | | | setting up an interactive database need not |
| explored most techniques of combining | | | | involve a huge investment in hardware or |
| brand-building with lead generation, to support their | | | | software. Some particularly effective systems |
| salesforce and large distributor network. | | | | have been set up using entirely manual controls. |
| Direct mail has long represented a sizeable | | | | The skill lies in developing simple, logical systems |
| proportion of their advertising and promotion | | | | which lend themselves to the gradual transfer to |
| budget; and they are now confident of their ability | | | | computerisation. |
| to generate leads very cost-effectively. | | | | A re-evaluation of the role marketing could play in |
| Maintaining a high level of salesforce productivity | | | | supporting the salesforce concluded:o Mailing should |
| remains an essential ingredient in staying at the | | | | be capable of distributing leads evenly across the |
| top of the hygiene market. | | | | sales territories in such quantities as to enable |
| Nevertheless, about two years ago, Newco began | | | | salespeople to plan their follow-up.o To improve |
| seriously to question the role of sales lead | | | | the value for money of each mailing, prospect |
| generation in their marketing mix. The basic | | | | lists should be made available for telephone |
| problem was that they had become too good at | | | | follow-up (which has been proved to double the |
| generating leads. The overall cost per lead was | | | | appointment rate).o The central database |
| fine, but this was not being matched by a | | | | (primarily a list of unqualified prospects) should be |
| correspondingly economical cost per sale. Indeed, | | | | made available to sales people to coordinate their |
| cost per sale was initially rising due, it has been | | | | own prospecting and feed-back of data to the |
| assumed, to poor feedback of results by the | | | | central file. |
| salesforce. Dissatisfaction with the lead generation | | | | Newco still have some way to go to complete |
| came to a head when senior sales management | | | | the new integrated system, but there has already |
| began to re-structure the salesforce and to | | | | been a general increase in sales productivity. |
| devolve greater accountability to sales managers | | | | The strength of the system lies in its flexibility. It |
| at area or first line level. Sales managers | | | | is capable of accepting large amounts of data |
| complained that the influx of leads was actually | | | | from a variety of sources bought-in lists, market |
| reducing sales force productivity. Their careful | | | | research, tele-sales agencies and the company's |
| work-plans to maximise the time salespeople | | | | own salespeople in order to personalise it to the |
| spent face-to-face with prospective customers on | | | | specialist needs of the hygiene market. |
| which their high performance depended were | | | | A key benefit is the constant improvement of |
| being disrupted by the sheer quantity and often | | | | results from direct mail, as feedback and analysis |
| random geography of the enquiries demanding | | | | of each mailing is used to amend the database |
| their attention. | | | | and refine future target audience selections. |
| At the same time leads were accounting for an | | | | The marketing department can now provide |
| unduly high proportion of total new business. The | | | | much improved guidance to the salesforce. For |
| other two main sources of the Newco's sales | | | | example, analyses of the existing customer base |
| consultant's new business were:o Sales created | | | | by type of industry and commercial business, as |
| from his own prospecting (self generated)o | | | | well as analysis of direct mail responses, can |
| Repeat and extension business sales from existing | | | | direct sales effort into particularly responsive |
| accounts | | | | market sectors. |
| Unchecked, undue reliance on leads generated by | | | | A further benefit of the central database to the |
| the marketing department would leave the | | | | sales consultant is that it can now regularly |
| salesforce vulnerable to the vagaries of the | | | | provide him with updated hard copy of customers |
| market and take control away from the | | | | and prospects sorted geographically. This helps |
| salesperson. | | | | the planning of sales activity to ensure efficient |
| Finally, Newco's excellent sales training programme | | | | prospect follow-up. Fewer opportunities are lost, |
| notwithstanding, lead-dependence could also | | | | and the face-to-face time can be optimised. |
| impede the development of salespeople into the | | | | However, the greatest benefit of this integrated |
| account portfolio managers the company needed | | | | approach has come from the restoration of |
| as the salesforce moved more and more into | | | | control of the sales effort to the sales manager. |
| national and major account selling. | | | | Sales managers have observed that a more |
| To restore the balance between self-generated | | | | balanced supply of leads, coupled with training in |
| and lead-generated sales, Newco set about | | | | the techniques of appointment-making and lead |
| creating a situation where leads would result in a | | | | qualification, has enabled salespeople to develop |
| net increase in sales productivity: if the maximum | | | | the important skills of self-sourcing new business |
| benefit was to be derived from Newco's direct | | | | and of managing existing accounts - skills that are |
| marketing activities, they had to be integrated | | | | essential to the key and national account |
| with the sales management. | | | | salesman. |
| What was required, in short, was a flexible and | | | | Internal promotions within the salesforce are at an |
| dynamic database, geographically structured to | | | | all time high. There has also been an increase in |
| the individual sales territories and regularly updated | | | | assignments of marketing managers into the sales |
| as the customer base grew. | | | | division and vice versa. This has resulted in a |
| Both the salesforce and the marketing | | | | cross-fertilisation of ideas and an overall |
| department would contribute input. On the | | | | improvement in cooperation and understanding. |
| salesforce side there was the traditional problem. | | | | |