Use Your Lead Lifecycle to Better Engage Prospects
When we talk about lead lifecycle, we want to understand the key stages or moments when we can leverage tools like marketing automation and CRM to engage our prospects.
Companies have traditionally defined a lead lifecycle model in stages. In the past, businesses have simply identified and categorized prospects into TOFU (top of funnel), MOFU (middle of funnel), and BOFU (bottom of funnel) sections and then assigned the opportunity to a sales team member when it was qualified by an automated system or person.
Since its founding in 2001, SiriusDecisions, a global B2B research and advisory firm, has been researching, studying and refining what is now considered the gold standard when it comes to lead lifecycle management. Known today as the Demand Unit Waterfall, this methodology can help companies further improve their existing lead lifecycle system. The most recent iteration of the waterfall takes into account that organizations are relying on incredibly specific buying personas before going to market at all and that technology such as predictive analytics are fueling their ability to do so.
Stages of the Demand Unit Waterfall
1. Target Demand
Whether you’re starting a completely new business or simply adding a product or solution, you need to start with what has traditionally been known as a target market, or in this model, a set of buying groups. Each buying group, or demand unit, is organized around a particular need for your product or solution. Companies must focus on reaching, attracting and engaging these demand units.
2. Active Demand
In this second stage of the waterfall, companies must confirm and refine the demand units established in the target stage. You must identify proof that those demand units actually exist or should exist within the current market landscape. Consider using third-party intent data, which reports on what particular online users read, download, search for, and comment on throughout the web. This information can help you determine which demand units are currently looking for products or solutions as well as those buying groups that have recently had a related incident that would prime them for your solution.
3. Engaged Demand
In order to progress to this third stage of the waterfall, a demand unit must have at least one individual who matches the company’s defined buyer persona and has submitted contact information as a result of a marketing campaign or web visit. At this point, the company should begin mapping this demand unit based on the demographics, geographics, interests, and hobbies discovered.
4. Prioritized Demand
Prospects within various demand units will continue moving through the waterfall as the company invests additional sales resources to nurture these relationships. This may include providing helpful resources, engaging prospects in discussion and questions, or making personal sales calls. By focusing on the pain points associated with each demand unit, an organization can position its product or service as a solution to a real current need.
5. Qualified Demand
Once the relationship has been solidified, your sales team will confirm that the fit between the prospect and your organization is strong and that a potential sale is pending. It’s important to always remember to focus on how your prospects fit within your identified demand units versus treating them as individual inquiries only. To do so helps you determine how many prospects can be categorized into those priority demand units.
6. Pipeline Opportunity
At the bottom of the waterfall, you are wrapping up the details by finalizing the contract in terms of price, deliverables, timeframe and close date. The data from this prospect’s buying journey should be well documented to help your organization continue refining its demand units for future marketing and sales efforts.
7. Closed Sale
Finally, we have successfully completed and closed the sale. Earned revenue is generated, and data is collected to continue to lead lifecycle process for future prospects within your prioritized demand unit.
8. The Prospect’s Journey
Now that we’ve looked at the lead lifecycle model from the perspective of the company, let’s switch gears and consider the prospect’s perspective. Although this model is a proven technical setup of a lead lifecycle, 70 percent of the prospect’s journey is usually completed by the time sales has even made contact.
In today’s information-rich environment, prospects often push themselves through the initial stages of the lead lifecycle by doing their own research and discernment. Although this may help in establishing demand units, it also leaves a great deal of potential for constantly evolving buying groups that are difficult to keep up with.
Consider how you yourself move through lead lifecycles for those products and services you purchase. Everyone has priorities and interests, and we are often bombarded with information related specifically to those leanings. At the same time, we are highly distracted with competing offers, an overload of data and news, and life in general.
In reality, there are a few very brief moments when all the stars align: the moment when we’re mentally engaged, have the time and resources available, and see the need for a product or service as a priority.
For a business, engaging a prospect with the right campaign or communication in those moments is critical to long-term success.
9. Strategic Components
We can define stages but how we interact and engage with prospects at every stage is what leaves a lasting impression. Here are some strategic elements to consider:
- Plan Marketing: Begin by understanding and identifying each demand unit, what their pain points are, and what their buying cycle entails. Break down this cycle to individual stages and plan appropriate content to engage at each stage.
- Measure Success: In many cases, the first phase may be a bit of trial-and-error. Be sure to measure early and often to determine which campaigns your demand units are engaging with.
- Improve Outreach: Invest further in successful campaigns and content while improving or eliminating less effective material or efforts.
- Sales Engagement: Once a prospect within a demand unit reaches the various stages of qualification, you’ll need even more specific means of engagement. What content are we providing at the prioritized demand stage? At the qualified demand stage?
- Follow-Up: Correct communication and customized engagement is critical near the bottom of the demand waterfall. Understanding the best way and which engagement points are most effective as well as the timing of outreach is critical.
Throughout your journey down the waterfall, continue asking the key question: Are we engaging with the prospect how we want or how they want? The answer must always be the latter.
In addition, employing the right combination of marketing automation tools and human intervention at appropriate points within the lead lifecycle is also important. Traditionally, the time to implement a campaign, measure results, and change direction has been lengthy. In today’s ultra competitive marketplace, the companies that are prepared to accelerate this cycle will win. Both the market landscape as well as prospects themselves are constantly changing, moving, and growing. It takes accurate data and swift opportunity management to engage and convert.
The good news is that many sophisticated tools are available today with improvements constantly in the works. Mathematical models can help businesses generate a more accurate lead scoring system, which provides this pinpoint information faster than ever.
The result is better and more qualified sales leads for the human sales team. When these prospects move to the bottom of the waterfall, they should be well primed with information and already sold on many of the benefits of your products and services. By the time you marry those qualified leads to a premier sales team, most of the hard work should already be done. The final personal, caring, and attuned touch of a team member should easily close the deal in the final stages.
Applying the SiriusDecisions’ Demand Unit Waterfall model holds many potential advantages. Not only will you be able to get a more up-to-date, high-level understanding of your customers within important demand units, but you’ll also be able to create data points at specific stages to measure engagement. A combination of both strategy, engagement and the technical configuration points are all required to create an accurate, detailed model that engages your prospects, rather than just classifying them.