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Case Study: How a Targeted Lead-Development Program Earned an IT Company 34% Yearly Growth for Five Years (and Counting)

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Company: CenterBeam
Contact: Karen Hayward, Executive Vice-President and CMO for CenterBeam
Location: San Jose, CA
Industry: Information Technology—Outsourced Services (B2B)
Annual revenue: Confidential
Number of employees: 175

Quick Read

For CenterBeam, a provider of outsourced IT services based in San Jose, sales is indeed a numbers game, but not in the traditional sense. Rather than trying to engage as many leads as possible, the company's sales force instead concentrates on a smaller quantity of well-qualified prospects and nurtures those through a seven-touch disposition process involving targeted email and voice communications.

This program, which was formed in partnership with PointClear, has proven much more effective than the old numbers game that CenterBeam used to play: It has generated a 12:1 ROI to date and helped achieve compound annual revenue growth of 34% during the five years it has been used.

Challenge


CenterBeam is a remote infrastructure managed services provider that specializes in desktop management, server and network management, and other support services for North American mid-market organizations.

The company, which relies on outsourced lead-generation services to build its business, faced a mini-crisis in 2003: It was spending a lot of money every month on leads that the sales team could not develop in the pipeline.

"The sales force was screaming about how horrible the leads were," recalled Karen Hayward, executive vice-president and CMO for CenterBeam.

Seeing it was time for a change, CenterBeam turned to PointClear, a Norcross, GA-based prospect-development firm, to handle lead development, market and lead-generation analysis ,and database management.

Campaign

PointClear's approach involved drilling down into the entire universe of potential leads to find only high-quality opportunities for the sales force to focus on.

The process started with identifying the top 10 performing SIC (Standard Industrial Classifications) codes and pinpointing mid-market organizations within those codes that were already aligned from a technology platform standpoint with CenterBeam's services. The intent was to ensure, before sales agents even picked up the phone, that no "wild-goose chases" took place.

Sales associates then initiated a seven-touch campaign involving phone and email communications to engage primarily CFO-level contacts within designated organizations.

"Most senior executives are two-and-a-half times more responsive to email and voice mail than lower level execs," explained Dan McDade, president of PointClear.

The multi-touch campaign was customized for each vertical and included brief, to-the-point communications that consistently built on the previous touches and referenced prior attempts to contact. Content also incorporated recent relatable and compelling industry news and events, such as a security breach, while highlighting associated service benefits. Relevant case studies and whitepapers were also used or offered during verbal conversations.

"We try to make it easy for someone in that buying window to self-identify," said Hayward. "We're very particular about the target market and audience in that market and try to be pointed in the communications we deliver so that they are relevant to where they're going."

In addition, all direct contact made by phone was not scripted; instead, associates were trained to bring up realistic scenarios and ideas and solicit feedback from the contact while carrying on a personable conversation on the possibility of outsourcing their current infrastructure provisioning.

Any leads that the sales team considered "questionable" were returned to marketing for analysis. If the marketing team was able to verify the lead quality, the lead would re-enter the cycle or the sales associate would receive additional guidance on re-engaging the contact.

Each campaign lasted several weeks. If at some point during that process a lead was deemed not interested or not yet ready to enter the sales cycle, it was set aside and recycled back up to six months later, depending on the SIC code. During that time, additional market intelligence was captured so that later communications would remain timely, relevant, and highly targeted.

Results

Between 2003 and mid-2008, CenterBeam experienced 34% compound annual growth in revenue. On average, 55% of CenterBeam's quarterly revenue—and a lofty 74% in the second quarter of 2008—has come through the PointClear lead generation program, along with 60-77% of CenterBeam's new business annually.

This has translated into "millions of dollars of closed business" and a 12:1 ROI to date.

"By focusing on high-performing SIC codes and delivering compelling outbound communications, we have been able to continue to generate high-quality CFO level leads that result in orders in spite of an extremely difficult economy," said Hayward.

Lessons Learned

Take time to cultivate leads

Lead nurturing—achieved through both the multi-touch campaign and recycling of non-respondent leads—has been a "critical plank" in the company's lead-generation strategy. In fact, CenterBeam reports that 50% of leads that were closed in the third quarter of 2008 had been previously engaged through this program before signing on.

"For every level and type of company, there tends to be an increase in response as we increase the number of touches," said McDade, who further recognized that there is also a point of diminishing returns. "It's always cost effective to make second and third follow-ups; the fourth one depends on the audience."

Identifying that point is a statistically driven process, which for CenterBeam was established at seven touches, although some of the company's targeted verticals warrant (and therefore receive) fewer.

"If we're not getting a good lead rate, we may cut back the number of touches and see what the impact is," said McDade. "But we know that if we're calling into a CFO of a large company, it will take a lot of touches."

He also noted that targeted campaign emails are sent out on a regimented scale so that they will not be perceived as spam.

Thoroughly qualify leads ahead of time to optimize sales resources

Employing a stringent Q&A program, PointClear ensures that every lead goes through at least two levels of scrutiny before being handed off to a sales associate; that for the most part ensures that the sales team receives only well-qualified leads.

They also continue to perform research on non-respondents and look for triggers that may represent new opportunities, such as a change in CFOs or other major events. For example, one company agent noticed that the company of a CFO who had sworn off outsourcing had been recently hit by a virus and decided to re-pursue the lead. "CenterBeam had an order 30 days later," Hayward recalled.

Continuously refine your process

In addition to calibrating the appropriate touch frequency for each vertical, CenterBeam and PointClear have consistently worked together to find new ways to garner better results. Through weekly teleconferences and quarterly in-person meetings, both companies scour analytics, survey new and existing SIC codes, and cooperate to determine the root cause of any "lows," but also of any "highs"—ascertaining whether any of those learnings might be successfully repeated in future campaigns.

This has resulted in a number of changes, ranging from optimized call flows and improved training, to the establishment of targeted landing pages that link to outbound emails, to moving "up-market" and focusing on larger customers that are easier for CenterBeam to support. It has also lead to improved marketing communications that have increased voicemail and email response from 19% of leads in 2006 to 24% in 2007 and to over 28.5% through September of 2008.

(What has your organization done to increase sales? We want to hear about it! Email CaseStudies@MarketingProfs.com.)

Related Links

Inspired by CenterBeam's targeted lead development program? Learn how other successful companies are using traditional methods as well as cutting-edge media to generate and nurture qualified leads and convert them to paying customers. Simply download B2B Sales Lead Generation: Integration of Web 1.0 and Web 2.0 Media (FREE) from the MarketingProfs Store. As a Premium Member, you can freely access this and hundreds of other case studies, templates, tools, research, and "how-to" guides that can help you rapidly build effective marketing programs.


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Kimberly Smith is a staff writer for MarketingProfs. Reach her via kims@marketingprofs.com.

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  • by nslemmon Wed Jan 28, 2009 via web

    We have used a 7-step contact program after the prospect has had an initial contact by voice or email with our firm. This was an interesting twist that I sent straight to my business development director to see about implementing. The 4-star rating is because it sparked a new idea!

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