After analysing more than 300,000 online sales leads we found a rather surprising pattern: About half of all conversions on these lead generation websites were something other than sales leads. The non-lead conversions included a wide range of inquiries, some with value and some without — spam, customer service calls, sales solicitations, incomplete forms, inquiries for the wrong product or service, personal phone calls, misdials, etc.

The point is, without lead validation (discussed in detail in the presentation below), companies use inflated and misleading data to evaluate their Internet marketing campaigns, and worse, to modify existing campaigns in ways that actually worsen rather than improve them.

What is lead validation?

Lead validation is the process of reviewing website form submissions and listening to recordings of phone inquires, to separate leads from non-leads and track leads back to their marketing source. Lead validation presupposes a company has the ability to granularly track phone and form inquiries; if this is not the case, tracking mechanics must be set up before lead validation can be implemented.

Why lead validation matters

Typically, companies do not validate sales leads, which limits them to using conversion data in their monthly campaign activity reports, and for making adjustments to campaign tactics and strategy. Since conversion data overstates lead production considerably, errors creep into strategic and tactical campaign management.

To begin with, when company leadership sees conversion data that is steady and increasing, they usually assume lead generation is steady and increasing, which may not at all be the case. In fact, if an Internet marketing campaign goes off in the wrong direction, for instance by emphasizing a particular keyword in a PPC campaign that generates a high number of conversions but very low number of leads, increasing conversion data could mask an underlying decrease in sales leads. Because leadership does not see the problem, it continues to invest in a PPC campaign with declining ROI.

On a tactical level, campaign managers likewise go astray if they rely on conversion data for campaign testing. In the hypothetical PPC example discussed in the preceding paragraph, the PPC manager would see conversions increasing for that particular keyword and ramp up emphasis on it, instead of decreasing it as he or she would if lead validation data were available. To make matters worse, the campaign manager would easily overlook other keywords with a lower number of conversions but with a higher percentage and/or raw number of sales lead generation. In short, the lack of lead validation data makes it easy for campaign managers to emphasize the bad and neglect the good. Over time, the flawed methodology of relying on conversion data drives potentially strong lead generation campaigns right into the ground.

Why lead validation is overlooked

With such obvious benefits to lead validation, why do so many companies and entrepreneurs fail to implement it? We have identified a few widespread reasons:

• Many companies have no idea how many of their website conversions are non-leads, and thus have no awareness of the issues. If marketers are not sure, check with the sales force — they are sure to know if they are receiving a lot of non-starter “leads.”
• Many companies do not properly track form and phone conversions. This is especially common with phone conversions, since Google Analytics and other backend analytics platforms don’t provide much useful tracking data.
• Some companies are so focused on other, less meaningful metrics such as rankings (little value) and links (a little more value) that they fail to zero-in on the one metric that matters more than all the others: lead generation.

In hope of helping organizations avoid these pitfalls and embrace lead validation, we produced the presentation below. We hope this information helps you improve the quality of your marketing!


By Aaron Wittersheim, chief operating officer at Straight North


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