Knowledge
When do you need more leads, and when a change of process or offer?
Not enough clients? Check whether you really lack leads
“We need more leads” may be an accurate diagnosis. But first I would like to see what happened to the previous ones. How many contacts led to a conversation? Which clients did you send a proposal to? Why did some of them drop out, and how do you know?
I worked with a company where the owner closed four out of five sales opportunities. Potential clients came mainly from referrals, and when a lead appeared, the owner knew how to take it to a contract. What he lacked were further sales opportunities independent of recommendations.
In other companies, improvement came from changing whom the salespeople talked to and how. We narrowed qualification and started diagnosing the client’s problems instead of proposing solutions right away. Only then was it worth increasing the number of conversations.
How do you tell these situations apart in your own company?
Before you order another campaign
At one event I spoke with the CEO of a company looking for an investor. The company had been operating for four years, had clients and, as I was told, “well-trodden sales processes”. I asked about the numbers. The CEO gave the average monthly revenue and called over the sales director for details. He could not say how much it cost to acquire a client or how the individual sales stages converted. What I did learn was that they had three salespeople running outbound.
Perhaps the data existed and my interlocutors simply did not have it at hand. But I never found out on what basis they assessed the team’s effectiveness. If you cannot point to where sales opportunities stall, it is hard to decide what to spend the next money on. A lead generation campaign may help, but it may also deliver more contacts with which you repeat the same mistakes.
That is why, before scaling up acquisition, I would check both the numbers and the course of a few specific sales.
What the funnel shows, and what you will not read from it
Start with the stages your clients actually go through. A spreadsheet is enough to begin with, as long as you can reconstruct the history of opportunities in it. The stages should have a specific meaning. “Qualified opportunity” has to mean more than “the salesperson thinks something may come of it”. You need shared criteria for comparing results to make sense. Look at a simplified example of two companies. The numbers show what happened to contacts from a selected period whose sales process has already ended. It is an illustration, not an industry benchmark.
| Stage | Company A | Company B |
|---|---|---|
| New contacts | 40 | 8 |
| Qualification | 30 | 6 |
| Needs discovery | 24 | 4 |
| Proposal sent | 20 | 3 |
| Contract signed | 2 | 1 |
| Conversion proposal → contract | 10% | 33% |
In company A, I would start by checking why 18 out of 20 proposals did not end in a contract. Did they go to the right clients? Did the salespeople know how the decision would be made? Was the client planning a purchase, or just exploring options? Or maybe the proposal lost to the competition despite well-run conversations?
The table does not give the answer. The fact that many conversations end with a proposal does not prove poor qualification either. The contacts may have been well selected even before the meeting.
In company B, I would check the source of the clients and a larger number of closed opportunities. One win in three proposals is too little to consider the result stable. If the clients came from referrals, I would not assume the same effectiveness for a new campaign either.
You can calculate how an improvement in conversion would affect the result. With 20 proposals, going from 10% to 25% means five contracts instead of two. That helps assess where it is worth looking for improvement. It does not yet say whether such a result is achievable or how much it will cost.
How to calculate this in your company
Track what happens to the same group of opportunities. With sales cycles of several months, contracts signed in June may come from proposals sent much earlier. Dividing them by the number of June proposals will give a misleading result. Include opportunities that are still open. Where possible, separate contact sources and types of services – a combined average for referrals, website enquiries and outbound may hide important differences.
Data from the last 6 to 12 months is the starting point. The period has to be matched to the length of the sales cycle and the number of transactions. With a small number of opportunities, it is worth reviewing each one separately. Do not look only for the largest percentage drop-off. Good qualification should reject poorly matched contacts. Above all, check where and why you lose the clients you want to serve.
When you really need more leads
The owner I mentioned closed about four out of five opportunities, which appeared mainly thanks to referrals. So he had grounds to believe he could sell his service to people who reached the company that way. What he did not have was a regular inflow of new opportunities beyond recommendations. He did not know when the next potential client would appear. In that situation, testing an additional acquisition method was justified.
This example has two important limitations. The owner’s effectiveness does not mean a new salesperson will achieve the same result. A referred client also has a different starting point than someone hearing about the company for the first time. So I would not carry the four-out-of-five result over into a forecast for outbound. Several circumstances occurring together argue for increasing lead generation:
- well-matched opportunities regularly end in contracts;
- the projects won are profitable;
- the company is able to serve more clients;
- the number of new opportunities is too small relative to the sales target.
I would start a new way of reaching clients with a limited test. One service, a defined group of companies and clear qualification criteria will let you assess what works. Check whether you reach the right people, whether the topic matters to them and whether real opportunities come out of the conversations. The number of replies or meetings alone is not enough to decide on increasing spend.
When the problem is the way sales are run
In many of the companies I have worked with, effectiveness improved after three changes: narrowing qualification, changing the way the conversation is led, and offering exactly what the client needs.
You determine more precisely who is worth talking to
A salesperson may have a full calendar and few chances of a sale. Some conversations then concern companies that are hard to help, projects outside the scope of services, or topics with no chance of being carried out in a foreseeable time. Narrowing the qualification criteria lets you recognize these situations earlier. The team has more time for clients the service really fits.
The criteria should follow from the company’s experience: whom you can deliver a good result to, which projects you earn on, and which conditions are needed for cooperation. A mere declaration of interest is not enough.
You start with diagnosing the problem
The second change concerns the moment the salesperson starts proposing a solution. The client mentions wanting a new website or application, and the conversation quickly moves to features, technology and pricing. Meanwhile, it is still unknown what prompted them to look for a contractor and what is supposed to change once the project is finished. Before you propose anything, it is worth establishing:
- what is not working now;
- what the consequences are;
- why the client wants to deal with it now;
- how they will judge that the project succeeded.
The answers delivered by in-depth needs discovery help decide whether and what to propose. Sometimes they also show why it is not yet worth preparing a proposal.
Speak from the client’s perspective
A story about experience, technologies and the team may be needed. It does not, however, replace the answer to the question of what the client will get out of it. Instead of limiting yourself to “we design websites for B2B companies”, relate the proposal to the problem established in the conversation. If the client says their audience does not understand the scope of their services, explain how the proposed work is meant to help with exactly that. Such a change requires listening first. It is hard to speak from the client’s perspective when the conversation mainly serves to present your own capabilities.
Check what happens after the meeting
Also look at the opportunities described as “waiting for a reply”. Did you agree on a date for the next contact? Is it known who makes the decision and on what basis? Did the client receive a proposal matching the agreed scope, or a generic document sent to everyone?
A review of a few such cases may point to a specific gap in the process. Then you improve the arrangements with the client or the way the proposal is prepared, instead of rebuilding the whole sales operation right away.
When the offer needs to change
A good conversation will not solve every problem. You can reach the right person, understand their situation and clearly present a proposal that is still not attractive enough for them. If similar difficulties recur with well-matched clients, I would check:
- whether you solve a problem the client considers important;
- whether the scope and the expected result are understandable;
- whether the client has a reason to choose you among the available options;
- whether the price and the way of buying fit this segment.
A question about differences from the competition is normal in itself. The problem appears when the team cannot point to a difference that matters to the buyer. Pricing from scratch does not have to mean a bad offer either. In non-standard projects it is often justified. It is worth looking into if, with similar enquiries, you establish the scope, the way of delivery and the calculation rules from scratch every time.
What we changed in a company with too broad an offer
I once joined a company that made web and mobile applications, websites, social media management and a few other things. Projects dragged on, people were overloaded, it was hard to standardize the way of working. We decided to focus on corporate websites supporting B2B sales and gradually phase out the other services.
The rebuild was broader. We replaced the team, introduced outbound as the primary method of winning clients and organized delivery, increasing the repeatability of projects.
The way of selling changed as well. The first paid stage was developing a communication tactic. Only later did we move on to the graphic design and the code. Salespeople with little technical knowledge could start conversations about business needs and propose a specific stage of cooperation that engaged the client and opened them up to the sale of the target project.
Despite deliberately giving up some projects, revenue grew by 40% year on year, and profit by about 25%.
I do not attribute this result to narrowing the offer alone. In parallel, we changed client acquisition, the people and the way services were delivered. This experience also shows how much work can hide behind the phrase “tidying up the offer”. You have to take care of existing commitments, prepare delivery and maintain the inflow of revenue during the changes. Such a rebuild can take a year or longer.
Before a similar decision, check which services actually have a good margin, how they burden the team and whether you can regularly win clients for them.
Where to start in your company
Not every company needs such a big rebuild. Start with one type of service and a similar group of clients. List the won, lost and still open opportunities from the last few months. Check their source, the course of the conversations, the length of the sales cycle and the reasons for the decisions. Where you only have assumptions, mark that and try to fill in the knowledge.
On that basis, choose the first action:
| What you see | What is worth checking or changing |
|---|---|
| Well-matched clients buy, but too few new opportunities appear | Test a new way of acquiring clients |
| The team spends a lot of time on clients who are hard to serve | Refine qualification |
| Conversations move quickly to the solution and the price | Improve the diagnosis of the problem and the expected result |
| Proposals remain without a decision, and salespeople do not know why | Check the buying criteria and the next steps |
| Clients understand the proposal, but see no reason to buy | Look at the offer and the choice of segment |
Treat this table as a prompt for what to check, not a ready diagnosis. The same symptom can have several causes. You do not have to stop acquisition while you improve the process. You can run a limited test and at the same time change the way you work with existing opportunities. What matters is knowing what you are evaluating before you significantly increase spend.
This is how I work on sales within SalesMachine: I connect decisions about clients and the offer with the way conversations are led, communication and measurement. The scope of changes follows from what the data and specific cases show. If you want to check where to start in your company, take the free online B2B sales diagnosis (in Polish).
