That’s not a good or a bad thing. Some organizations are just better suited for this strategy than others, and we’ve worked with enough to know the difference.
Companies that invest in inbound without first considering whether it’s really right for them risk wasting money that could’ve been spent on a more suitable marketing solution for them. Here are a few signs inbound may not be a good direction for your enterprise.
Great customers come from good leads.
This principle often gets obscured by the important, yet secondary, KPIs people measure. Page views, calls-to-action clicks, and conversions are all critical, but they are a means to an end: closing new business. All that effort is wasted if the leads you attract are not the right fit for your organization.
If your team does not have a clear vision of what a good lead looks like, inbound marketing will not be a profitable endeavor for you. Here are a few universal attributes that will help you define an ideal prospective buyer:
They Have the Budget – You cannot qualify a potential customer without knowing they can afford your services.
We all know this, yet people often discover late in the process that the prospect can’t afford the goods, resulting in a lot of wasted time and effort. You can always hope they’ll remember you if they do find the money someday, but you will have to sell them all over again, possibly facing new decision makers with new objections to your solution.
Many people are uncomfortable talking about budget with someone they are trying to establish a relationship with. That is natural. You don’t want to turn people off, so handle the question carefully. We suggest waiting until the second or third call to talk about cost, when both client and salesperson are comfortable and ready to have a deeper discussion about how they might work together.
They Want to Grow – We are stating the obvious, here, but a lead is worthless unless the company is motivated to change. If they don’t feel compelled to seek a solution like the one you provide, you've got a rotten prospect on your hands.
They Influence the Buy – Your point of contact must play an influential role in the purchasing process. This does not mean you need to target the CEO. These people are extremely hard to get to and usually don’t play much of a role until the end of the process, when they review recommendations made by stakeholders and sign off on the budget. The person usually charged with the task of finding a business solution is a middle manager. That’s the one you want to talk to.
Determining customer worth is another gauge for figuring out whether inbound is right for you, and the best way to find that is by calculating the lifetime customer value. HubSpot uses LCV to predict how much revenue a customer will spend throughout their entire relationship with your company, multiplying their monthly spend by the length of time they will buy from you.
Lifetime Customer Value = (monthly spend) x (number of months they will do business with you)
An average inbound marketing retainer is $5,000 a month. LCV gives you clarity on whether you can achieve a sensible ROI from that investment. If your customers spend $3,000 a month and stay with your company an average of five years, that’s a $180,000 lifetime value per customer. Would an inbound solution that generates several customers be worth an annual investment of $60,000? We think so.
On the other hand, if you don’t get a lot of repeat business and margins are small, inbound is probably not the way to go.
The strength of inbound marketing is in the way it follows consumer buying behavior.
People are going to research purchases before deciding what works for them, and most customers decide what they are going to buy before talking with a salesperson. The only question is who they are going to buy from.
Inbound tends to be a better fit for B2B marketers for a couple of reasons. First, business products and services usually require research, particularly in the manufacturing and tech industries where new solutions are reaching the market every day. B2B budgets also allow for bigger margins and greater ROI, which offsets the cost of inbound marketing quicker than B2C.
More than just a strategy, inbound is a mindset, a philosophy the entire organization needs to adopt from the top down to achieve outstanding results.
The core principle behind it is simple: We earn sales by being completely transparent with customers. There are no secrets, no proprietary information we should hold back. If customers want to know something – we need to explain it to them online.
It amazes me how many business owners say they’ve “embraced content marketing,” yet refuse to talk about costs online. Cost is the number one question people have. Why would we intentionally send them to our competitors to find this information?
Some people worry what will happen if customers and competitors know certain things about us. I say put it all out there for the world to see. If you can distinguish your business by being the only one who will talk about cost (and other topics your competition won't touch) – why wouldn’t a customer want to do business with you?
Earning trust is earning success in this space. If you are afraid to communicate with people honestly, or need to water down every post because of legal concerns, I would not go down this road.
An inbound strategy is one of the best investments your organization can make, but the key is getting everyone in your organization - from the C-level to admin staff - to adopt the principles behind great communicating and teaching. Nothing matters more than this. You can have a great customer lifetime value, amazing products and strong ROI potential - without employee adoption, it just doesn't work.
Once you get buy-in, though, and people start seeing the difference in the quality of sales leads coming in, they will never look back.
I attended Inbound 2019 with the same agenda I have for the last three years.