Every company loses at least some customers each year. You have to find new customers to make up for the ones you lose. And if you want to grow, you have to find even more.
After you have identified a specific market and learned how to tell your story, the next marketing obstacle you face is to generate enough leads that can turn into new customers.
Dr. Lisa Lang identifies lead generation as the third marketing mistake that she sees her clients make: They do nothing or not enough to generate leads.
Much of what Dr. Lang says about lead generation will sound familiar to you.
- Hope and a website are not a strategy.
- Too many companies create websites that are about their company, not about their customer.
- Although you can generate leads in many ways, it’s impossible to know ahead of time what lead generation methods will work best, so you have to test, test, test.
- One place to get started is to look at your competitors. If you see them using a lead generation method for several months, it is probably working and so you could try that method also.
- Map your funnel and measure your results at each stage.
After giving this familiar advice on lead generation, Dr. Lang makes a surprising assertion: “The more you spend to get the lead, the less you have to worry about the competition.”
What does Lang mean by this statement?
Her argument goes like this: If you can afford to spend more on a lead, you must be getting a better Throughput (Revenue minus Direct Variable Costs) on each transaction. In other words, your margins are higher. You might be spending $10 on a direct mail piece, but you can afford it. Why? Because you’ve got good margins and you are sending the mail to a specific targeted market with a high response rate. So even though your direct mail costs are much higher than your competition, your margins let you afford it and your response rate lets you justify it. Your competitors with lower margins and a less targeted market can meet neither of these criteria.
Hence Dr. Lang’s assertion: “The more you spend to get the lead, the less you have to worry about the competition.”