How can you avoid the dead ends and track down those lucrative, high-quality deals? inspiration and 90 per cent perspiration. To produce this feature, less than one-fifth of the time was spent sitting at the PC, writing. The rest was spent chasing leads, and simply talking to people.
This is also the case in the channel, where finding business - and especially new business - is concerned. Every dealer knows what it is like to chase a dead end, poor-quality lead and to sit at the sharp end of a six-month sales cycle waiting with sweating palms for a piece of business to finally drop.
It is common knowledge that finding a new customer takes a lot longer than deriving more business from an existing one, although just how much more varies according to who you talk to. Vendors claim resellers don't spend enough time trying to exploit their existing customer bases.
Boe Horton, director of business development at Persoft, agrees that existing clients are a valuable source of leads and, ultimately, revenue.
But he questions the usefulness of many of the more traditional techniques used to court those customers for renewal business.
'Many dealers are still approaching their existing client bases in the wrong way,' Horton says. 'Treating it as simply a network of handshakes and names is not the way to win more business. An existing customer should be treated the same as any business prospect and the same questions must be asked before the initial pitch.'
Notwithstanding the value of existing customers, some observers say the real problem lies elsewhere. It is impossible for companies to prosper, much less grow, in the long term unless they can source high-quality, profitable new business, says Jenny Tomblin, channel marketing manager at Oracle UK.
She is quick to add that this is often easier said than done and traditional methods of lead generation are found wanting on an increasingly regular basis. 'Part of the problem is that resellers and vendors are loath to move away from traditional ways of finding business. It was always the case that vendors that had a channel strategy and an indirect route to market were expected to provide their partners with a certain number of prospects - and rightly so.'
But given the growing maturity of the market, Tomblin admits that this might not be the most efficient method of finding prospects. As with many channel issues, the heart of the problem seems to revolve around the channel's history.
Horton believes the channel and its vendors are equally culpable when it comes to the poor quality of lead generation and lead generation techniques.
'Companies have often placed unreasonable demands on vendors with regards to the supply of leads,' he says. 'The vendors, meanwhile, have often been guilty of supplying poor quality leads that frustrate and waste the channel's time. Neither is conducive to finding business - no one has the time or the inclination to waste time finding that out.'
All too often, manufacturers still aren't qualifying leads before passing them on to their channels, adds Ian Robin, UK and southern Europe channel manager at keyboard manufacturer, Keytronic. He says the quality of leads is too often left to chance: 'The first port of call should always be the vendor's sales team. All advertising and marketing enquiries should undergo a screening process where the caller's requirements are firmly identified. Only then should they be forwarded to the reseller.'
Stuart Anderson, marketing manager at Pegasus Software, says vendors still form an important source of leads and prospects for many resellers and that they still have a responsibility to their partners. 'The channel still requires quality leads to sustain its own marketing efforts. Where possible, vendors must try to qualify any leads before passing them on to their partners.'
There are, he adds, several means by which vendors can supply quality leads. 'As well as standard advertising campaigns, it's important to profile the customers whose leads you may be passing on to your business partners.
We have such a procedure in place. Once this is complete, we buy in mailing lists of the same type. We then mail the list on a monthly basis and pass the resulting leads on to the channel. The customers are more targeted and resellers are more confident about chasing those leads than those from standard advertising.'
Focus is shifting
But there are signs that the entire focus of where leads come from is shifting away from the vendor origination and towards the channel itself.
Times are definitely changing, Tomblin says. Many resellers are looking to other sources for high-quality leads and those that aren't will have to stop relying on their vendors.
'It's not that companies - whether they are channel-based or manufacturers - have drastically changed, but as the industry has matured, so have its users,' she says. 'All businesses have become more aware of what their information needs are and have much more savvy when it comes to product search and selection. They know what they want and what it should cost.
The industry, and more specifically its routes to market, have got to be able to evolve at the same rate or will face some serious growth problems.'
David Thorpe, partner marketing manager at Lotus, says this is slowly beginning to sink in. The majority of Vars are now genuinely trying to invest more time and energy in improving the quality of the leads they end up chasing in earnest.
'More often than not, our Vars want the rawest leads they can get, rather than those that have been pre-qualified. That way, they can control the whole generation and sales process,' Thorpe says.
'It works really well. We declare the provenance of the lead to the reseller and, in turn, we ask that the reseller is extremely specific about the kind of lead he is looking for. We can match the lead precisely to the kind of reseller we think will fit the bill.
'We don't waste time qualifying leads the reseller would rather take raw anyway,' he adds. 'The reseller knows the local market better and can qualify the lead and script and tailor its approach accordingly. Most importantly, the users get exactly the kind of bespoke service they need - so everyone wins.'
Richard Fisher, channel director at Sage Group, has noticed a similar pattern. 'Most, if not all, Sage dealers don't want their prospects qualified to the last detail. They say it forestalls the scope of the sale and can decrease margins. Self-qualification can give the dealer the chance to sell higher-value models from the product portfolio, add extra modules to the sale and even add the important value-added products and services to increase margin still further.'
Thorpe stresses, however, that resellers aren't always quite so keen to do the leg-work themselves. It is important, he says, that the whole channel is encouraged to adopt this self-sufficiency model.
'A great deal depends on the type of reseller,' Thorpe adds. 'Incredibly, there are still some acting purely as tools for vendor and distribution fulfilment. It's important for Vars that this is discouraged in the long term - we can't just give all the leads to all the partners.'
Horton contends that the way the industry chases business is also, out of sheer necessity, beginning to move away from traditional marketing and advertising methods, towards more focused but subtle techniques. He cites direct marketing as an area of significant change in lead generation.
'The effectiveness of many direct marketing techniques is beginning to wane quite noticeably,' Horton claims. 'Too many people jumped on the direct mail bandwagon. The result is that nine out of 10 pieces of direct mail end up in the bin and cold calling is a waste of time.
'Two or three years ago, the success of such techniques justified the resource, but more companies are witnessing increasingly diminishing returns on the time, effort and expense they put into direct marketing,' he adds.
'It has come full circle. Many users ignore direct marketing and go looking for product information themselves.'
Steve Power, operations product manager at Pegasus, is equally critical of traditional methods of lead generation, arguing they are not practical in real terms.
'It is all very easy to place advertisements in the relevant magazines and to generate leads that are then fed to your resellers, but you can only measure results and gauge the quality of the leads at the end of the campaign,' he says. 'This can be expensive because you don't know until the end whether or not you were hitting the correct note with potential customers.'
Horton advocates more highly-targeted techniques. 'Advertising and marketing may produce stacks of leads, but in real terms it's pretty superficial and doesn't serve to produce the kind of leads that result in tangible, written business,' he says. 'In isolation, those leads will have no real direction and will generally be of poor quality.'
Many vendors are introducing initiatives to help channel partners generate business, but Horton says these schemes need to be formulated very carefully if they are to be successful in the longer term. 'It is important that vendor channel marketing mechanisms address the issue in the right way.
Vendors must encourage their partners to get closely involved with initiatives.
It becomes a self-fulfilling prophecy - the more closely the reseller works with the vendor, the more it will be included in opportunity-generating activities.'
Tomblin also stresses the importance of self-reliance: 'The most successful channel partners will be those that can exercise some degree of self-sufficiency and have their own autonomous marketing plans and infrastructures in place.
'There are already signs this type of organisation is beginning to come to the fore and you can bet that if you don't take the initiative, they will,' she adds. 'As vendors, we have a duty to encourage resellers to be more proactive. It's no good just giving resellers leads - we have to give them the ability and the means by which they can generate leads for themselves. It's important that we put those mechanisms in place if the channel is to evolve.'
Robin adds that vendors have to learn to be more selective when choosing their resellers. 'For a partnership to function successfully, it is crucial that vendor requirements are matched with the relevant channel expertise and skill sets. This can vary dramatically from region to region and, with it, the dynamics of the market.'
Other techniques are also being employed across the channel, including reseller training schemes, partnership programmes, seminars, Web-enabled lead generation and targeted marketing. But David Mattia, managing director of connectivity software reseller Avanti, is very matter of fact about what the channel needs to do to secure high-quality prospects.
'What it comes down to is that we've got to know our customers, our products and our markets that much better than the next man - it's about education,' he says. 'Living by your wits has been a way of life in the channel for a long time, but resellers can't hope to keep flying by the seat of their pants forever.
'Too many dealers have got away with too much for too long. Pretending to be all things to all men used to be relatively risk free but that's why users have become so cynical. These dealers will be found out and, when they are, the rest of us had better be on our toes because if we don't take advantage you can bet that someone else will. In the end, it comes down to simple hard work and sticking to what you're good at.'
He adds: 'We simply cannot rely on vendors for our best prospects any longer - they'll only give us leads if there is trust, and to foster trust we have to be working hard to get leads for ourselves. It's an ongoing process.
'It's all about coming to terms with the numbers game. As ever, the more people you talk to the more chance you have at making a sale. Things haven't really changed in that respect. The number of people showing an interest has always been a lot higher than the number who actually end up buying anything.
'Ultimately, making a success of a business in the channel is about learning to live with the difference,' Mattia concludes.
The generation game
Distributors and other third parties are becoming more involved with lead generation for resellers and the internet is increasingly being used as a lead gathering and distribution mechanism, its immediacy and convenience being two obvious factors.
Although many distributors have traditionally avoided lead generation activity because of concerns about potential channel conflict and overlap with vendor activity, some have been able to make it work.
Northamber, for example, has reaped the benefits of its Solution Point campaign and both Computer 2000 and Ingram Micro are using lead generation as part of their focused campaigns to target SMEs (see feature, page 43).
Nigel Judd, channel services development manager at C2000, says focus is the critical factor in making lead generation programmes work. 'One of the main things we found from the research we did when putting together our Business Class programme, is that SMEs want to buy locally and SME resellers have particular specialisations. By identifying those needs we can make the lead generation much more effective. We are able to match up the customers to the resellers more accurately.
'Without that knowledge of the customer's needs and the reseller's skills, it would be very difficult to match the parties that were really well suited,' he explains. 'The focus - first on the SME and then on the specialisation of the reseller - is critical.'
Stuart Anderson, marketing manager at Pegasus Software, says it is important for distributors and vendors to provide leads, but that resellers also need to do some of the their own lead-generation work.
'If you advertise in your local area, it's bound to be more pertinent.
We advertise in most of the magazines that are our target read, but our campaign is, of course, national.'
Even though it is focused on one particular area of the market and the vendor's advertising may bring in leads, the vendor can't guarantee they will be from businesses local to you, he adds.
'The vendor is often better employed helping out with mailing campaigns.
If we use mailing lists we get very good results because we are more targeted and that usually means a better quality and more widely distributed set of leads.'
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