4 Ways to Optimize the Middle of the Funnel
Author: Adam Hutchinson
Like the middle child, the middle of the demand generation funnel receives far less attention than it deserves.
At the top of the funnel, marketing increases traffic and fills the database with new leads through paid ads, social media, search, referral programs, and a variety of other channels. At the bottom-of-the-funnel, we help close the sale by creating urgency and helping our prospects make the business case for purchasing our product or service.
But in between, we need to nurture and qualify our leads by encouraging them to engage with our content until they’re sales-ready. It’s easy to overlook the middle of the funnel because it involves many different priorities, from quality to quantity to speed to customer experience, and it can be the most difficult to manage.
What is the middle of the funnel?
According to the SiriusDecisions Demand Waterfall, the middle of the funnel is the area where the marketing to sales hand-off happens (MQL to SAL) and where the sales development representative (SDR) to account executive (AE) hand-off happens (SAL to SQL).
The middle of the funnel, or MOFU, is like a valve. It’s where you can expand lead quality definitions to pass a higher volume of leads to your sales team or tighten lead quality definitions to give them a more specific segment of qualified leads.
At Socedo, as well many other B2B organizations, our marketing team focuses on facilitating a successful hand-off to sales. The marketing team develops content to educate leads and identifies the leads who show buying intent by implementing a behavioral lead scoring model. They also spin up campaigns aimed at accelerating leads, such as limited-time offers, product trial campaigns, and case studies.
In the middle of the funnel, marketing aims to help the sales team prioritize their time by providing clear and accurate information on each lead passed to the sales team and concurrently, sales’ focus is on creating as many deal opportunities as possible from the leads they’ve received from marketing.
Why focus on the middle of the funnel?
With so many transitions happening during the hand-off process, the middle of the funnel has the biggest potential for misalignment between marketing and sales, as well as within sales. Below are some common bottlenecks that may arise during this stage.
Misalignment during the marketing to sales hand-off:
- Marketing does not pass enough leads to sales to create a sufficient number of opportunities to meet their revenue target.
- Marketing hands off enough leads to sales, but leads are hard to reach because they are not ready to consider a purchase yet and need more nurturing.
- Marketing sends too many leads to sales, and sales doesn’t have enough information about the leads to prioritize them effectively.
Misalignment during the SDR to AE hand-off:
- SDRs could have a hard time reaching the leads marketing passed to them.
- It can take too long for SDRs to create sales accepted leads to send to AEs.
By creating common definitions and goals, you can help alleviate sales and marketing misalignment. Here are some you’ll want to understand and agree on:
- Lead volume helps determine whether your top-of-the-funnel marketing efforts are sufficient to meet sales’ revenue target.
- Conversions measure lead movement from stage to stage, showing how marketing is performing throughout the entire sales cycle.
- Velocity is the time it takes a lead to move through the funnel, typically measured in days.
These metrics help marketing understand its impact on the business and where to prioritize their investments. Weakness in any one of these areas will affect revenue, so marketers need to keep a pulse on how the middle of the funnel is performing at any given time.
The middle of the funnel also presents some unique problems. Leads become stagnant or “cold” here. They may stop responding to marketing content and thus aren’t qualified yet for a sales conversation. This can lead to slow velocity and a restricted lead flow for sales. Fortunately, there are four key strategies you can leverage to tackle these problems:
1. Fight Low Lead Quality at the Source
Not all lead sources are created equal. At Socedo, we track four metrics for every lead source:
- Volume of MQLs
- % SQLs (opportunities created)
- % closed won (new customers)
- Average selling price (ASP)
While it’s helpful to dive into ROI goals for specific programs, these metrics help us stay accountable for driving quality leads to sales and identifying problems as quickly as possible. For example, we’ve found that leads whose last action was a trial sign-up tend to move much faster through the funnel and close at a higher rate than leads whose last action was a webinar viewing. For lead sources with lower-than-average conversion rates, such as whitepaper downloads, we require a higher qualification bar before passing the lead to sales.
Additionally, data quality directly affects lead quality. Bad data leads to low contact rates and lower conversions. At Socedo, we use several third-party lead generation programs to help us generate new leads. Sometimes, these leads look like good quality leads at the top of the funnel because they come from companies in our target market, but once we pass them over to sales, we realize that important data such as company size and phone number are incorrect. We use Clearbit data enrichment to clean up as much data as possible, but occassionally, we need to shut down sources completely due to bad data.
2. Accelerate More Leads from Specific Segments
Building a repeatable lead nurturing process is the pride and joy of any demand generation marketer. Unfortunately, the business doesn’t always follow our perfect plans. Sometimes, we need to send a large volume of leads to the sales team quickly, either to meet a strategic goal or make up for lost time.
Rather than going broad and sacrificing quality, marketers can narrow in on a specific segment of leads waiting in the middle of the funnel. For example, a couple of months ago, we needed to send more leads to the sales team. We found that we had a significant number of engaged content marketers (one of our target audiences) in our database, so we ran a campaign with a new offer specifically for content marketers and only targeted leads with content job titles in the “Engaged” stage in our database. While we can’t run this type of campaign every month, it provided a nice bump in volume when we needed it.
3. Improve Lead Velocity with Lead Scoring
Lead scoring is a key lever you can pull to improve lead velocity. At Socedo, our demand generation manager performs a regular regression analysis on our database across several different behavioral factors to determine which characteristics make up a “good” lead.
Across several actions, such as email clicks, website visits, whitepaper downloads, webinar registrations, and social media engagements, we measure how many leads who took these actions ultimately led to deals, customers, and revenue. By conducting this research, we can determine which behaviors are the best indicators of buying intent.
Here’s an example of this with dummy data:
From there, we create a weighted score for each action. If a lead who clicked on a link in an email is 50% more likely to become a customer than a lead who visited our blog, we’ll adjust our lead scoring model to reflect email clicks at five points and blog visits at three points. By adjusting our lead scoring model in this manner, we’re able to send leads who are more ready to buy to sales faster, improving our metrics.
Because our content, audience targets, and business goals do shift over time, we make sure to run this analysis every month to make sure our lead scoring model is aligned to serve our goals.
4. Reduce Handoff Friction with Content and Context
When your sales team doesn’t have enough information about each lead to follow up with them in a way that creates urgency, the result is often non-responsive leads and slow velocity. Marketing can alleviate this problem to an extent.
As a first step, marketing can provide the sales team with case studies, whitepapers, and other educational materials that sales can send to leads. As a next step, marketing can create optimized content experiences for leads by linking one piece of content to another (i.e. when a lead watches a webinar, send them a related e-book).
To ensure that our sales team can follow up with each lead, our marketing team created an alert email that gets sent to a sales rep every time a new MQL is assigned to them. This email contains lead record data and contextual information, such as the title of the webinar they just watched and a few details about the webinar. Then, our sales rep can simply reply to the email if something seems inaccurate or they need more information about the lead. A complete marketing automation platform, like Marketo, will have a way to help you communicate with sales and share all the engagement activities and interesting moments in a lead’s history.
To avoid turning the middle of the funnel into a bottleneck, work in tandem with sales to increase conversion rates and velocity for results that spread across the board. Have you experienced any middle-of-funnel bottlenecks in your marketing organization? How did you fix it? I’d love to hear in the comments below.
4 Ways to Optimize the Middle of the Funnel was posted at Marketo Marketing Blog – Best Practices and Thought Leadership. | http://blog.marketo.com
The post 4 Ways to Optimize the Middle of the Funnel appeared first on Marketo Marketing Blog – Best Practices and Thought Leadership.
via Marketo Marketing Blog http://blog.marketo.com
November 1, 2016 at 01:49AM