Generating sales leads is probably the most important ongoing task to ensure the survival of your business, but doing so on your own can cost you time, and deplete your personal bandwidth. If this is the case, you may want to consider handing over that task to an outside firm that specializes in generating sales leads for businesses such as yours.
Of course, hiring an outside firm will cost you, but it can also grant you peace-of-mind that specialists are handling the most crucial aspect of your business. Before you hire one, however, you need to evaluate your business to determine if this is an appropriate move for your current business situation. .
Dollars and Sense
The biggest question to ask yourself when deciding whether to hire an outside lead gen firm is: will it be cost-effective? Lead generation services – especially B2B – often charge you per lead or can cost you thousands of dollars per month. As a result, your customer acquisition costs (CAC) will be driven up. The hope, however, is that the cost of hiring a lead generation firm will be offset by increased sales resulting from the extra sales prospects that the firm is bringing to you.
Due to the cost, however, lead gen firms are probably most useful to high-margin small businesses that sell big-ticket items or services: medical offices; accounting and law firms; car dealerships, real estate companies, etc. If the increased CAC is so dramatic that it forces you to raise the price of your products, then hiring a lead generation service is probably not your best bet. You’d be far better off putting in the time and effort to generate sales leads on your own.
While you may have the budget to hire a led gen firm, it doesn’t mean that your budget is infinite. Some firms will charge you per month, while others may charge you per lead. It’s important that you determine which pricing plan would make the most sense for you.
If you’ve done the math and concluded that hiring a lead generation firm will benefit you, it’s crucial that you do your research and find out as much about them as possible beforehand to determine if they are the right fit for your business.
#1 Do Your Due Diligence!
Like you would with any other outside vendor, you need to research any lead generation firm you might be considering. First, find out if they’re ranked by any credible business source. For example, Fit Small Business, an online resource for small businesses, offers reviews and rankings of the most popular lead generation firms.
Also, go to each candidate’s website and look for customer reviews and find out if they have experience in generating leads in your particular industry or geographic location. Try to get an idea of their pricing and how they get their leads. These are the firms that have experience in knowing where to look for sales leads and how best to glean information from them such as income range and interests.
#2 Do They Produce Quality Leads?
Poor quality sales leads won’t do anything for your conversion rate and worse yet, land your emails or phone calls on spam lists. What you want, besides contact information, are prospective customers who can afford – and are generally interested in – your products or services. In other words, you want leads that will produce the highest possible conversion rate. Will the lead generation firm produce a list of prospective customers that have previously purchased products or services in your industry? Will the lead generation firm build a list from scratch, or simply give you a ready-made list? If they are offering you a ready-made list, that’s probably not a good option – it may contain outdated information, and the firm probably hasn’t weeded out all of the sales prospects who said no.
#3 Make Sure They are Compliant
There are laws in place in the US, such as the CAN-SPAM Act of 2003, that regulate solicitation emails, and you need to make sure your lead gen firm is in compliance with them. The act requires marketing emails to be sent from a legitimate email address, and the subject line must pertain to the body of the email, among other things. If you are trying to sell to customers overseas, especially in Europe, your led gen firm needs to be compliant with the European Union’s GDPR law that regulates marketing and solicitation emails.
Not complying with these laws can lead to stiff fines and other penalties against your business, so it’s crucial that you inquire about this.
#4 Set Specific Expectations
Transparency is key, so you need to be as clear as possible about the volume of leads and what types of leads you expect from them. Ask them what their definition of a quality lead is and how much they charge for that, as the definition of a lead may differ from firm to firm. Some firms consider a lead to be anyone who makes contact with them about your business, while others consider a lead to be someone who is willing to set up a meeting with you.
You need to also find out what emailing platform and email address the firm is reaching out to prospects with. Make sure the messages that prospective clients are responding with show up in your mailbox – not theirs. This way, you don’t risk missing out on legitimate leads because the firm forgot to forward them to you. Make this crystal clear with the lead gen firm before you sign a contract.
Make Sure it Makes Sense for You
Lead gen firms can be very useful in increasing your sales and client base, but keep in mind they are not for every business. You need to conduct a careful analysis of your business to determine whether hiring such a firm will be cost-effective and make sense for what your business is trying to accomplish.