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Are Leads Groups Dinosaurs?
I was asked today about whether I wanted to participate in a “leads group.” For those of you that don’t know what a leads group is, it is typically a group of people who promise to exchange prospects with each other. There are a number of groups that do this, and some people certainly get business from it. I hadn’t thought about leads groups in quite some time, so I was surprised when I was asked.
It got me thinking – Do I want to participate in a leads group? Are leads groups even a good idea? I answered ‘no’ to both. As a matter of fact, the entire premise of a leads group bothers me. It’s a remnant of the industrial age and it’s time that we end the practice. Why?
The entire foundation of a leads group is flawed. It’s based on an old fashioned quid pro quo, I’ll-scratch-your-back-if-you-scratch-mine philosophy. It’s artificial, manufactured and manipulative word-of-mouth. To be in a leads group, you must (emphasis on must) gives leads to other salespeople. If you don’t, you get kicked out. Entering into that type of arrangement violates the trust a professional salesperson should have with his/her clients. The idea that a salesperson that I work with may be trading my time for their benefit bothers me.
I’ve said it before, and I’ll say it again and again — word-of-mouth is the best form of marketing out there, as long as it is sincere. Sincere word-of-mouth is a selfless act. It is done with the customer’s interests at heart, not the salesperson’s or those of someone in a leads group.
If you are in a leads group, you may be taking issue with this post. You may say, as my friend did, that “We only give a lead if it is in the interest of the buyer.” I don’t buy it. I believe that you may actually feel that giving my name to someone in your group is in my best interest. And I believe that you may not consciously intend to trade on my trust and goodwill to meet your lead quota. Protest if you will, but the fact is this trading of names is precisely why these groups exist.
Frankly, I think a leads group is more about creating the illusion of doing something productive than it is about doing something productive. Instead of ‘trading’ referrals, why not go out and do something that is so great that people feel compelled to talk about it? Who knows, doing that may give you more leads than you can handle.
When is Free Too Expensive?
A new daily newspaper made its introduction to my neighborhood recently. It’s delivered to my door, it’s free, and I want it to stop. Yesterday, driving into my community, I realized I was not alone. All the other notices had been removed from our community bulletin board to make room for a large posting informing everyone how to have delivery of this paper (to which no one subscribed) stopped. Needless to say, I’ve made the call (though I still need to see how long it will take to get results).
This got me thinking, this ‘free’ daily has become awfully expensive for the members of my community considering all the time and energy they have had to put into dealing with it. As I’ve often written, if you fail to create value, you destroy it. This ‘free’ paper solved no problem for me. But, it has created a problem –our paper recycling storage cans fill up twice as fast as before.
I did not lack information, news or opinion. The new paper has done nothing to position itself as anything that I should pay attention to. Probably the most despicable thing is that the people who publish this newcomer failed to ask for my permission before invading my lawn. Now, I have to spend valuable time to get this unwelcome publication out of my life.
Businesses do this all the time. They fail to determine whether or not they are creating value when they create an encounter with their clients and prospects. In the effort to market themselves, companies increase the costs in time or energy to the very same people they say they are trying to help. Next time you do something with or for your prospects/clients, ask yourself if you are truly creating value – or are you just creating more trash for them to deal with?
Respect
I am a proponent of building a customer/client community. I am a big fan of word-of-mouth (WOM) marketing. I believe that the best way to grow your business is to have your advocates become a voluntary ‘sales force.’
It just makes sense: Your customers know the benefits of what you do better than anyone else. Your customers trust you and like you. Most importantly, they give you their attention. This is the key. I have so little attention capacity and I am very particular about who I give my attention to. When I, or any customer, willingly gives you attention – that is an asset. A business can make a lot of money with that asset alone.
Don’t misuse it. Attention is the golden goose. You customers value you, they respect your opinion and, when you communicate with them, they expect that communication to add value to your relationship. If you abuse the access they’ve given you, if you fail to respect it, you will kill the golden goose. Never seek a dollar of revenue today at the risk of diminishing the basis of trust you have developed. It’s not worth it.
The moment I feel that you don’t hold my relationship with you as sacred, I am done with you. Most people I know feel this way, even if they don’t express it. By the way, when if you fail to live up to that bond with me, you not only lose the opportunity for me to spread positive word-of-mouth, you’ll probably lose my business as well.
Make A Promise
As companies look for ways to reinvigorate both the quality and rate of their growth in the post-industrial-age marketplace, I’ve found they struggle at a critical first step – making a promise. Jim Collins in his book, “Good To Great”, asked the now-famous question, “What can your company be the best in the world at?”.
Answering this question is critical if you want to be able to make a compelling promise – not just to the market, but to the people who work with you, as well. If you can’t answer it, quality growth will always be simply another item on your wish list.
Notice, however, that Collins does not ask, “what is your company the best in the world at,” he asks “what can your company be the best in the world at.” It is rare that a company is already the best at what it wants to best at. By extension, it is rare that a company is capable of delivering on the promise it makes at the time it makes the promise. It’s something you have to grow into.
In fact, I don’t recommend choosing a promise you can deliver right now. As I’ve written before, to truly differentiate yourself, you have to have the courage to make a promise your competition either cannot or will not emulate. Be definition, this means you must promise something that doesn’t currently exist.
Don’t get me wrong, it is not okay to make a promise that you will never be able to deliver. But don’t wait until you are able to deliver a promise before you make it. This is not a chicken or egg question. Make the promise and you will develop your ability to deliver it. A compelling promise should not only excite your potential clients, it should excite your team as well.
The point is this: decide what you can be the best at and put all your efforts behind achieving that vision. Don’t get hung up figuring out exactly what you do now. Decide what you can do and start trying to do it. The triggers for growth are always hidden inside your efforts to make and keep big promises.
When Does Transparency Lead to Commoditization?
Ben McConnell & Jackie Huba over at The Church of The Customer recently blogged about CoffeeCup Software and how this company has taken transparency to extreme levels and turned their client base into their sales force. Here’s what they say:
If you’re really lucky, you might stumble across someone like CoffeeCup Software, whose website features 100 referenceable customers from 11 countries who will answer your questions about the company, its products and support.
That’s a company using marketing to help make selling superfluous.
Are they correct? Is this a good idea? Well, I went to CoffeeCup’s website and they make software for website programming – the epitome of a commodity. It’s an over-the-counter solution. It’s simple.
What if you offer a more complex solution – something that requires a specialized understanding of unique situations? In this case (which is true of virtually all value-added solutions), making selling “superfluous” is a bad idea. Your sales approach should create value by providing an accurate diagnosis of a prospect’s problem, and if it creates value, then it is not superfluous.
I do not make it easy for prospects to talk to my existing clients early in the sales cycle. Why? My prospects aren’t ready to talk to my clients until they understand the problem they have. When I first meet a prospect, or when a potential buyer first finds out about me from my website, they do not adequately understand their problems. They are aware only of their symptoms, and a ‘self-diagnosis’ often only contributes to the problems they are trying to solve. If they don’t talk to a ‘qualified diagnostician’, they will continue to look in the wrong places for a solution.
Conversations with your current clients are great for enabling a prospect to determine if what you do works, but these conversations are generally counterproductive when it comes to enabling a prospect to determine if they have a need for what you do. I’m all for transparency – just not when it promotes commoditization.
Human Capital?
I recently heard a consultant talk about the need to recruit and retain talented “human capital.” I have to admit that my jaw dropped. Human capital? Are we still comparing people to digits on a ledger? I agree that it’s more enlightened to think of the people who work for you as assets rather than liabilities. But language counts. Using a term like “human capital” is a dead giveaway that someone doesn’t fully comprehend how the world has changed. It objectifies people. It relegates them to being some abstract component in a business plan. It also leads to poor decision-making. When the solution is positioned as part of the problem – you’ve got a big problem.
I understand what the consultant was trying to do. He’d probably be upset to read this post (too bad). His use of the word “capital” in describing “humans” was probably motivated by the desire to somehow elevate the humans in an organization to the exalted level industrial-age businesses reserved for cold, hard cash. But his correlation implies a relationship between a person and an organization that I believe is a relic of the 20th Century.
Look, I’ve worked for people, worked for myself, and today I have a growing staff. I don’t want to be considered ‘capital’ nor do I consider the people who work for me “capital.” It’s funny, had the consultant merely used the word ‘people’ instead of an abstract term like ‘human capital’, I would have thought nothing of it.
In the industrial age, capital was the critical resource that either limited or spurred growth. It’s why in the past monetary policies always seemed to trump “human policies” in business. Today it’s not capital, but flesh-and-blood people that make companies grow. There’s plenty of capital around. The challenge these days is finding people to carry out a strategy and motivating those people to want to.
The first step may just be to stop thinking of people as capital. They mean so much more than that to your organization.
The Carnival of Marketing for May 7
There’s a lot of great stuff on the web to help anyone who is attempting to accelerate the growth of their business. Here, at The Fast Growth Blog(tm), we are attempting to lead the way in developing a new roadmap for what I now call – The Wisdom Age. It is with that lense that I recommend you check out the following 7 links for this week’s Carnival of Marketing.
1. Becky McCray addresses the challenges and the opportunities that exist in determining how to name what it is you do, in How to choose a business name. Becky accurately addresses the importance that a name has before the sales process even begins.
2. Jack Yoest reminds us that merely because an idea was created in the industrial age doesn’t mean that it’s a bad idea. In Selling the Great Wall of China Jack reminds us that it is the emotional experience above all else that drives decisions.
3. Virgnia Miracle joins Brains on Fire’s powerful blogging crew reminding us that in today’s world authenticity and consistency are critical. Being Yourself Offline and Online is a terrific reminder that everything matters.
4. Eric Mattson brings one of his 1,000 podcast interviews with ‘rapid prototyping’ aficionado Jason Fried. Marketing Monger’s interview is very interesting for those looking to really add value for your clients.
5. John Moore once again gives great insight into one of the great growth companies of all time – Starbucks. Lessons Learned From Howard Schultz is a must read for any company looking to succeed in The Wisdom Age.
6. Garr Reynolds reminds us all that everything you need to know about growing a business was taught in Jazz. Don’t miss this one.
7. Finally, my favorite blogger, Spike Jones reviews an important lesson for anybody trying to build a business on the frontier. Fight Club should be printed and passed out to everyone in your company.
I wish I had room for more. These 7 should keep you busy. Feel free to let me know what you think. Next week the carnival goes to Spare Change, so e-mail your posts to weinreich at social-marketing.com.
The Problem With Marketing
I’d like to oversimplify the buying cycle for a moment. A buyer goes through six basic stages:
1. The realization that the seller exists.
2. This sounds interesting/good.
3. Let’s talk. (This does not necessarily require an actual conversation. When I go to Amazon’s website, I am ‘talking’ to Amazon).
4. I could use this.
5. Wow, I need this.
6. Here’s my money.
No sale can take place without a conversation (actively or passively). For any company with an active sales force, virtually no sale (certainly no first sale) can take place without a conversation. Therefore, marketing’s first job should be getting a potential buyer to decide to talk with the selling company. Nothing else matters. Additionally, in most B2B situations, a prospective buyer can’t understand the seller’s offering until a conversation takes place.
Therefore, marketing geared to lead generation would be best used focusing on enabling a prospective buyer to talk with a prospective seller. Despite this, most marketing is focused on the sixth stage – here’s my money. When the message is focused on stage six, and the first five stages haven’t been fully developed, the message has no chance doing anything other than commoditizing a company. That doesn’t mean people won’t buy – people buy commodities every day. It means that the marketing efforts are contributing to driving down margins – not the ideal role of marketing.
What should you do about it? Stop trying to convince me (or anyone else) to buy your offering before you’ve convinced me that we should talk. Tell your prospective buyers how they will benefit by talking with you, and, more importantly how they will be hurting themselves if they fail to talk with you. Do that and you will generate more leads, and you’ll see the extraordinary power of effective marketing.
The Carnival of Marketing Coming to The Fast Growth Blog Next Week
We’ve had the honor of having several of our posts chosen for the weekly Carnival of Marketing. The week of May 7, we have the pleasure of hosting the carnival. This means that we will chose the 7 best posts related to growing you business. So, if you have any posts you’ve written or you enjoy, send them to us at doug at imaginellc.com by Sunday at 5pm.
This week’s carnival is being hosted by Marketing Ventures, so check it out.
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Resources
Doug's Washington Business Journal Columns- Intelligent Growth Articles
Third Wave Selling Blog
Products to Grow
