Part 2: Using the Ladder of Lead Generation
What is a lead?
What is a lead? This seems like a simple question, doesn’t it? But when the term “lead generation” is often used interchangeably with “outbound phone calling,” it is worthwhile spending just a minute to clarify our terminology.
For purposes of this article, a lead is someone who has been identified as possibly having interest in the organization’s products or services, but whose stage in the buying cycle is undetermined. In other words, we know enough to know that they might have some interest in the organization, but we don’t know how strong that interest is.
And while we are clarifying terms, in the rest of this article I’m going to shorten “organization’s products and/or services” to the simpler but slightly more ambiguous “organization.” So when I say that a prospect has an interest in an organization, my intent is to communicate that they have an interest in the organization’s products and/or services.
Marketing-based lead generation for life science and biotech companies
Based on our definition of the word “lead,” marketing-based lead generation is the process by which life science and biotech companies use marketing to encourage people in a clearly defined target audience outside the company to identify themselves (directly or indirectly) as possible prospects to people inside the company – that is, to “raise their hands.” This hand raising can happen in many ways: at a tradeshow, through an inbound phone call, etc. The identification can be complete (a business card), or incomplete (a voicemail message with just a name and a phone number). The identification of someone as a lead can be initiated by the prospect themselves, which is an inbound lead (“Please have someone call me”) or by someone else – an outbound inquiry (“Hey, I read that you got a promotion, so I’m calling you.”). While outbound lead generation is a valuable activity, for the rest of this article I’m going to focus primarily on inbound lead generation (i.e., getting people to raise their hands) and mention outbound activities only in passing.
When leads surface, the next step is to determine the strength of their interest (and other characteristics such as their potential fit as a customer, etc.) by asking questions. This action (known as qualifying or converting) shifts their status from that of lead to that of contact. Based upon the results of the qualification process, a specific set of next steps is defined and responsibilities are assigned.
Leads in life science, med-device and biotech companies
Life science, med-device and biotech marketers are interested in inbound leads in particular because the point at which individuals “raise their hands” is a point when the sales cycle might begin to accelerate. I say might because inbound prospects typically “raise their hands” at one of three stages of the buying cycle: during Stage 2 (Contemplation), Stage 3 (Planning) or Stage 4 (Action). (Here is where you can find more information on the stages of purchase behavior)
Prospects in stages 3 and 4 are late-stage opportunities, and acceleration of the buying cycle (action) is imminent. However, prospects in stage 2 are still early in the buying cycle, and research has shown that prospects can remain in stage 2 (“I’m thinking about it” mode) for quite some time. Note that stage 2 prospects can sound almost as interested as people who are about to buy (stage 3 and 4), but in the case of stage 2 prospects, there might be little movement for months or even years. (For more on distinguishing between early-stage and late-stage opportunities follow this link.)
The ladder of lead generation in marketing life science, med-device and biotech companies
Last month, we introduced the ladder of lead generation. The ladder is a scaffold on which all lead-creating activities can be placed, including every activity that generates leads for your life science organization: your trade show presence, outbound phone calls, web site, pay-per-click ads, social media activities, the articles you publish, your speaking engagements, etc. Figure 1 shows all these activities grouped together into different families, starting at the bottom with Personal Interactions, and climbing upwards through Outbound Solicitation, Paid Exposure, Content Marketing and ending with Free Exposure.
Figure 1: The ladder of lead generation is a way to organize ALL possible lead-generating activities in your organization from Personal Interactions at the bottom to Free Exposure at the top.
As I mentioned in the last issue, this ladder is not a “sales funnel;” the value of the ladder is that it will give you a framework on which to build your lead-generating initiatives. Figure 1 does not show every possible lead-generating activity placed on the ladder, but this ladder is a scaffold that WILL hold every such activity. Thinking of hosting a happy hour and inviting some prospects? That activity would go at the bottom of the ladder (Personal Interactions). Adding video to your website? That activity would go in the middle of the ladder (in Paid Exposure or Content Marketing, depending upon the content of the video).
Key points about the Ladder of Lead Generation and the marketing of life science and biotech companies
There are three main points that are important to understand about the ladder of lead generation.
- Your ladder must rest on a strong foundation to be successful. If you don’t have a unique position and a clearly defined brand, all other marketing activities on the ladder will be inherently weakened.
- The role each rung will play in communicating your unique value is different. To create leads, your unique value needs to be defined, articulated, claimed, declared, demonstrated and validated. Each rung on the ladder makes a different contribution to this process.
- Activities on different rungs have different attributes and offer different returns in areas such as lead quality, speed of generating results, reach, and cost and effort required.
Let’s examine these points in greater detail.
Your ladder of lead generation must rest on a strong foundation
Your ladder of lead generation rests on a foundation with two layers: your positioning and your brand. (These two are not identical; your brand is not your position, and your position is not your brand.) Without a solid foundation, your lead generation efforts will be ineffective.
The most visible layer of the foundation for your ladder of lead generation is your brand, which has both verbal and visual components. A solid life science brand helps your organization’s communications stand out from the competitive clutter. Your brand is the articulation of the unique value provided by your organization. Your brand helps convey this unique value to your audiences in ways that resonate with them.
The other layer of the foundation is your positioning, one of the crucial links in effective marketing. I have written elsewhere about positioning and provided a template to get you started with your positioning efforts. I won’t review all the facets of effective positioning here but will remind you that your position must meet 7 key criteria: it must be clear, unique, authentic, sustainable, important, compelling and believable. Arguably the most important of these is the requirement that your positioning be unique. Without uniqueness, you condemn your offering to commodity status.
Your positioning defines your unique value to your audience. One goal of your lead-generation activities is to raise your organization’s visibility – but without unique value, all the visibility in the world will do little to encourage prospects to raise their hands.
Together your brand and your positioning form the foundation for your lead-generation activities. A strong foundation thus helps define and articulate your organization’s unique value. It is this foundation that allows all lead generation activities to succeed.
Each rung plays a different role in communicating your organization’s unique value
Your unique value must not only be defined and articulated, it must also be communicated clearly. Different rungs on the ladder support and accomplish this communication in different ways, as shown in Figure 2.
Figure 2: Activities on different rungs of the ladder of lead generation support your claim on uniqueness in different ways. Your unique value must be defined , articulated, claimed, declared, demonstrated and validated.
The lowest rungs of the ladder (Personal Interactions and Outbound Solicitation) are where your unique value is claimed in one-on-one or one-on-few conversations. These claims may or may not be believable, so the rest of the ladder is necessary to build trust.
Activities on the Paid Exposure rung of the ladder are crucial in declaring your unique value to the world at large.
Activities on the Content Marketing rung of the ladder are crucial in demonstrating your unique value. It is this ability to demonstrate your unique value that makes the activities on this rung so effective in driving both visibility and leads. This is the newest rung on the marketing ladder, but scientists have been employing these types of activities since the 1700s, using original content to improve their reputations via peer-review publishing. (Here is more information on the comparison between peer-review publishing and content marketing.)
Activities on the Free Exposure rung are crucial in validating your unique value. This validation comes from others – typically editors or trade-show producers. This external validation is what gives the activities on this rung such power and reach.
The role each rung plays in communicating and promoting your unique value is different. Because each rung has different strengths, a well-balanced set of lead-generation activities will rely on a mix of these rungs to drive inbound leads.
Activities on different rungs have different attributes in supporting marketing-based lead generation for life science and biotech companies.
In our last issue, we discussed two of the key differences between rungs that are high on the ladder and rungs that are low on the ladder: Quality of leads generated and speed of result. Activities on lower rungs (Personal Interactions and Outbound Solicitation) will generate results the most quickly. For example, a week’s worth of outbound telephone solicitation will yield more leads than a week’s worth of effort in trying to get a place on the podium at a conference. However, since activities on lower rungs are outbound in focus, there is a higher likelihood that the people contacted will not need your products/services. The leads generated from rungs that are higher on the ladder will be more valuable, as they are more likely to be both inbound and late-stage (that is, ready to buy). For more on this, see our last issue.
There are other differences between activities on higher and lower rungs:
Reach: Activities that are higher on the ladder have greater reach and visibility. Being quoted in an article in a well-read trade publication (an activity on the Free Exposure rung) will give you greater visibility than making a series of outbound phone calls (Outbound Solicitation). Giving a presentation at DIA (Free Exposure) allows you to reach a greater percentage of your target audience than simply walking the show floor (Personal Interactions).
Cost: Activities on different rungs require different amounts of out-of-pocket expenditures. I’m not talking about opportunity costs, but strictly referring to spending hard cash. Generally the activities on the Paid Exposure rung involve the greatest expenditures.
Effort: Activities on different rungs require different types of efforts. The higher the rung, the more the effort requires mental energy; the lower the rung, the more the effort involves time.
Figure 2 shows these different spectra. There are lots of possible spectra that could be attached to this ladder; my goal is not to identify every one. I simply want to point out that different rungs have different attributes, and the selection of activities used to drive leads should be made with a clear understanding of these different attributes.
Figure 3: Attributes of the ladder of lead generation. Different rungs have different attributes, such as the Quality of Lead generated, the Speed of generating results, the Reach/Visibility, the out-of-pocket Costs and the type of Effort required.
Creating your own ladder of lead generation
In our next issue, we’ll cover how you can use the ladder of lead generation to plan a lead generating campaign. For now, you can begin by creating your own ladder of lead generation; start by organizing all your marketing activities into different “rungs.” Then take the following steps:
1) Examine your foundation. Do you have a documented positioning that is clear, unique, sustainable, authentic, important, believable and compelling? Are your brand expressions clear and consistent?
2) Within each rung, determine whether the activities are properly supporting your claim of unique value – do they claim, declare, demonstrate or validate? If not, can you modify them so that their relationship to communicating your unique value is strengthened?
3) Examine the ladder for imbalance. Are you putting too much emphasis on some rungs while ignoring others? If so, can you rebalance your portfolio of lead-generating activities? For example, our extensive experience in this sector has shown us that few firms are devoting enough resources to content marketing. If you are interested, here is a link to more information on content marketing in the life sciences.
With a properly constructed ladder resting on a strong foundation, your lead-generating activities will yield results in both the short and the long term.
- A lead is someone who has been identified by a salesperson but whose stage in the buying cycle is undetermined.
- The “ladder of lead generation” is a scaffold on which all lead-generating activities can be placed.
- All activities on the ladder can be used to create leads, but all leads will not have the same value to your organization.
- Your ladder must rest on a strong foundation (a unique position and a clearly defined brand) to be successful. Without this strong foundation all other activities on the ladder will be hamstrung.
- Each rung will play a different role in promoting your unique value. To create a steady stream of incoming leads, your unique value needs to be defined, articulated, claimed, declared, demonstrated, and validated. Each rung on the ladder will make a different contribution to this process.
- The different rungs have different attributes relative to lead quality, speed of generating results, reach, and cost and effort required.
- Create your own ladder of lead generation and judge your activities by asking the following questions: Do you have a strong foundation for your lead generating activities? Do your lead generating activities properly support your claims of unique value? Are your activities properly balanced?
In our next issue, we’ll address in more detail the creation of an effective lead generating plan by using the ladder of lead generation to create a steady stream of incoming leads.