HomeBlog Eliminating Revenue Engine “Tollbooths”: Is It Time To Retire the Lead Object?

Eliminating Revenue Engine “Tollbooths”: Is It Time To Retire the Lead Object?

September 26, 2019 | By Anthony McPartlin

  • Different object types (leads and opportunities) in sales force automation systems present a compatibility problem that hurts conversion rates, impedes functional alignment and expands sales cycle times
  • It’s time to leave leads behind and use opportunities to manage prospects right through the revenue journey
  • Using opportunities drives alignment by providing one vehicle to capture all information about the buying group and the related information and insights

Over the last 10 or so years across the U.S. and Europe, one of our most despised forms of road furniture, the toll booth, has more or less been replaced by overhead scanners. This switch creates a seamless journey from one location to another without requiring drivers to stop, fiddle around for the correct change, or wait while the next driver realizes they’re in the wrong lane.

If we assess the journey within the B2B revenue engine for leads and opportunities, we often find a range of metaphorical toll booths at different stages in the sales cycle that hurt velocity, conversion rates and functional alignment. Usually, leads are at the heart of this problem, creating a level of functional friction, or what Italians refer to as “agita.”

Whether the argument is about lead quality, volume, service-level agreement commitments or attribution — at the macro level, things have not improved to the level expected considering the focus, investment and technology applied to the problem of alignment in recent years. A recent SiriusDecisions survey of 192 respondents from b-to-b marketing, sales and customer success organizations reported that they are far from achieving complete alignment, with sales and marketing alignment rated at a modest 3.6 out of 5 on alignment, while marketing and customer alignment was even lower, at 3.2.

A significant contributor to this lack of alignment is the lead object in our sales force automation systems. To continue the road analogy, leads are an ineffective vehicle for the revenue journey. Here’s why:

  • Modern B2B buyers make decisions as groups, not individuals. In modern B2B purchases, there are multiple stakeholders involved in the buying group, but the lead object supports just one buyer. As a result, we are not providing sellers with a holistic view of the buying group, including the participants, their roles and their requirements.
  • Second-lead syndrome. Many lead management processes place a disproportionately large value on the first new qualified leads from a new account, and then significantly discount or ignore the assumed value of the second and any subsequent leads from the same account. These leads are considered duplicates and disqualified without any further qualification.
  • As a result, lead conversion rates are generally poor. SiriusDecisions benchmarks show that, on average, the conversion rates from an inquiry to closed/won is 0.5% to 1%. Imagine if someone told you that was your probability of reaching your destination in a car journey! You’d take the train.

The solution to move away from this inquiry-centric era involves combining the use of demand units with the replacement of leads with opportunities. Opportunities are a far richer and more flexible data object, allowing both marketing and sales to track all members of the buying group and their interactions right through their buying journey.

To do this effectively requires a mental shift, however, particularly in sales. Opportunity creation in many organizations has been the preserve of the sales organization. To track the entire buying group effectively, the entire go-to-market team has a role to play in building a comprehensive view of the opportunity. This means redrawing the traditional maps of ownership around opportunities. This is a key fact for marketers looking to contribute effectively to revenue growth at their organizations. If the creation of an opportunity is dependent on the perception of an individual seller, your marketing efforts will be compromised.

Determining the right stage for opportunity creation depends on organizational context, but the process can evolve over time. For example, the most common starting point we see is for sales development reps to start creating opportunities on the basis of certain buying group criteria having been met (e.g. number of buying group members engaged). Opportunity creation may advance to earlier in the process over time (e.g. depending on account signals or active demand), and to even more sophisticated approaches to support account-based marketing programs by creating unique opportunities for each possible opportunity in the targeted accounts (target demand).

From a sales perspective, this is a huge advance compared to leads. It provides sellers with a comprehensive package of data that gets added to and evolves over the course of the buying process, giving them the information — contacts, interactions and insights — they need to engage successfully with all members of the buying group, not just one.

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Anthony McPartlin

Anthony is a highly adaptable and strategic sales operations leader with extensive global software industry experience. Throughout his career he’s demonstrated a detailed track record of solving complex challenges across a range of areas including planning, compensation, analytics, technology and pricing for corporate and regional sales leaders worldwide.



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