What is Lead Generation?
The idea of lead generation seems fundamental to most businesses. In order to understand lead generation, we need to fully understand what is a lead?
According to Wikipedia a lead is: ‘the contact information and in some cases, demographic information of a customer who is interested in a specific product or service.’
But often eCommerce Business to Consumer (B2C) companies do not refer to this information as leads, but rather as registered visitors. So why is the term lead generation not widespread in B2C?
The difference is largely timescales, product cost, and the need for personal interaction.
Lead Generation – B2B vs B2C
Lead generation is chiefly classed as a Business to Business (B2B) activity where marketers generate leads through a myriad of Marketing activities for the sales team to follow up.
In a B2C model, Marketers create demand that is more often than not, serviced by a website rather than by a sales person. There are of course exceptions, builders and trades people will promote their businesses to consumers, and the resultant phone call, email or web form will be handled by someone in sales. This type of purchase needs a level of personal interaction to determine the work required and the cost thereof. Other areas are where the value of the purchase may be significant eg. car sales and house purchase.
Conversely some B2B businesses that sell directly off their website (such as coffee sales, office consumables etc) may not classify their visitors as leads.
However, to be more precise than the Wikipedia definition, a lead is often classed as a prospect or potential customer, rather than a customer. And lead generation is only the start of a sales funnel. The primary difference of lead generation in B2B vs B2C is the extended length of time and the process in which a lead is turned into business.
Who is responsible for Lead Generation?
In all businesses whether you call them leads or registered visitors, lead generation is the primary role of Marketing. And in B2B organisations, Marketing departments are often targeted on the volume and quality of the leads they generate. Any B2B Marketer will understand the ratios between the number of leads created with the level of business closed as a result of these leads. Many are often incentivised based on the amount of closed business which can be validated as having been generated by Marketing activity.
The Lead Generation Process
Here is the process in which a generated lead follows in a B2B organisation:
As you can see the time taken to move from an unqualified lead through to a confirmed piece of new business can be considerable.
This is mainly due to the level of personal interaction between the selling organisation and the buying organisation. There are many different stages that a generated lead has to pass from qualifying the lead sufficiently through negotiation within different areas of the business to ensure sales success. Dependent on the type of product or service being sold this process can takes weeks, months or even years with multi-million-pound deals.
Within B2C organisations this process is rarely handled by sales people but by increasing digital engagement to stimulate purchase. The following diagram shows that nurturing visitors along the sales process stimulates desire and drives conversion.
