Sales Leads: Cock And Bull Stories
As more resellers find the sales leads passed on to them are completely hit and miss, Annie Gurton finds out what vendors can do to strike the bullseye
Sales leads are a traditional component of the package vendors offer to their chosen resellers, but resellers are increasingly critical of these leads. Many, they say, are not worth the paper they are written on.
Even vendors that depend on the channel for all their fulfilment activity, and have no other way of getting their product to market, are remarkably cavalier about the way they handle sales leads. Those with a combined direct and indirect channel are accused of cherry picking the best leads for themselves, while those that use only the indirect channel are said to be completely unselective about the leads they pass on.
There appears to be very little matchmaking between resellers and customers ? no checking to make sure the lead is not just an enquiry for information, and scarcely any procedure for followup.
In short, the whole process of lead generation and management is a mess, and does little to improve the reputation of the industry among users.
Sharon Beer, vendor relations manager with reseller Info Products, says the leads the company receives from suppliers are often completely inappropriate. ?We are a corporate reseller. We focus on large organisations, but we often get small and medium-sized business enquiries passed to us, with instructions to sell a few PCs or consumables.?
?The trouble is that when a vendor passes on a lead it expects us to be grateful, and thinks that it can hold us to ransom over the number of leads it has passed on.?
Beer says Info Products is not set up to sell to small and medium businesses. ?We don?t have the logistics or the cost model,? she explains. This is made clear to all the company?s vendor suppliers, but they still send names and addresses on pieces of paper and expect Info Products to spend time and effort making contact and trying to make a sale.
Shane Gallagher, managing director of First Stop Computers, agrees that too many sales leads are hit and miss. He says: ?We try to take the leads supplied to us seriously, but I can understand resellers that just throw leads away because they are a waste of time.?
Gallagher has created a process which tracks all the leads and gives the supplier feedback, even if they don?t ask for it. ?You?d be surprised at who just throws leads at us and then doesn?t check at all as to how we are getting on with them,? he says.
?We insist on giving feedback, if only to make them think a bit more about the quality of the leads they supply.?
James Hall of reseller ML Networks agrees that resellers have a responsibility to establish a tracking process, which should include giving the vendor feedback. ?US Robotics posts its leads on a bulletin board on the internet, and it is up to the resellers to select the ones they want to follow up,? he says.
?To me, this is a perfect way to distribute sales leads. Once resellers have accepted one, they have a responsibility to see it through.?
However, Hall adds that the general quality of the leads from suppliers is extremely patchy. ?There is no way of knowing for sure, but I?m convinced that the best leads go direct to the preferred resellers,? he says.
The trick then, is to become a preferred reseller, which Hall says is achieved by developing a relationship with the reseller manager within the vendor organisation. ?Some vendors are notorious for sorting their leads into the cream and the dross, and allocating them to favourite resellers,? he says. ?But if you stick close to a vendor and give it plenty of feedback, you will find that the quality of leads which come your way goes up dramatically.?
Wiebe De Vreis, marketing manager at Amsterdam-based vendor Network Peripherals Europe, says it is difficult for vendors, such as his company, which have to use distributors to manage the reseller network. ?We use Acal Electronics, formerly Dean Microsystems, and it does a good job for us, but we are totally dependent on it to qualify the leads and pass them on to the appropriate reseller,? he explains.
This is a situation that many overseas vendors face, because they do not have their own infrastructure in this country for managing resellers. ?We realise that it is not perfect,? he says, ?and distributors are not set up to spend time on lead qualification.?
Consequently, Network Peripherals Europe is considering appointing a third-party specifically to qualify sales leads and monitor their progress through the resellers. ?We try to speak to our resellers to gauge how they feel about the leads the distributor passes on and assess whether they are able to close them. We know that the current situation is not ideal,? De Vreis says.
Jim Spooner, technical marketing director of distributor SST is also of the opinion that the quality of leads is too varied, and too few are qualified. ?Many are wasted,? he says, ?but the responsibility lies with the vendors, not the distributors.?
Spooner says it is in the vendor?s interest to check its leads, yet few do. ?If a distributor wastes a lot of time on a batch of low-quality leads from a manufacturer, the next batch that manufacturer sends will be low priority.?
Spooner says failure of the vendor suppliers to qualify and monitor leads is negligent and highly destructive. ?They are not measuring the effectiveness of the different types of advertising and marketing spend. They are unable to establish which advertising works best. Huge marketing budgets are therefore wasted, and those costs are passed on.?
Gallagher says too many leads are, frankly, junk. ?Often so-called leads are just the names of people who have filled in a response coupon on an advertisement. That?s not a lead. A lead is someone who has been contacted by the vendor, which has established they are not wasting time,? he says.
Many people just fill in response coupons when they are looking for information, and are a long way away from making a purchasing decision. Those names should not be called sales leads. ?The vendors don?t listen. They just see the number of leads they pass on and don?t consider the quality. But it?s not a quantitative thing, its entirely qualitative. Try explaining that to the vendors,? says Gallagher.
He agrees with Beer that the whole issue of leads becomes a ploy in the negotiating game vendors like to play. ?They say they pass on x number of leads and expect us to be grateful, but the time we often have to spend on qualifying the leads makes them uneconomic. If we don?t respond to the leads they send us, they hold it against us.?
Leads can be extremely valuable, says Gallagher, or they can be annoying for both reseller and prospect. ?If you are someone who has cut out a form in a magazine, you don?t always want to be contacted by a reseller that is expecting you to buy. You may just be looking for information.?
The onus is definitely on the vendors, adds Gallagher, to invest more time in the qualification process. He says in his experience, Compaq provides good leads. ?Its call centre is very good,? he says. IBM also provides good leads which are pre-qualified. ?IBM works at a personal level and the customers it passes on are already at a stage where they are ready to talk seriously about a purchase,? Gallagher says.
Beer says the leads provided by manufacturers are usually so poor that they are best ignored. ?We are focused on the Times top 250 UK companies and international customers, and that group often has a direct relationship with the major manufacturers. They would not pass on that calibre of leads.?
Info Products depends on its own salesforce and the relationships it has built direct with its target customers. ?We find that building close relationships with the direct sales team within our strategic vendor suppliers creates sales opportunities, but the normal lead system rarely works for us.?
Beer adds that if a vendor is running a campaign centred on a specific technology, such as data warehousing or electronic commerce on the internet, and Info Products is appointed as one of the few resellers qualified to receive leads generated by the campaign, the system can be worthwhile.
?This scenario can open doors within a focus account which may currently deal with a competitor,? she says.