• Introduction
• How sales teams can generate leads
• Customer referrals
• Lead generation best practices
• Prospecting
• Elevator pitch
• Reach out cadence
• Establish upfront contracts
• Conversations
• Winning

Introduction

Understanding the journey from initial contact to a lead to a customer is paramount in the context of B2B software businesses. Leads come in various shapes and forms but they fundamentally are generated by two sources: a) sales teams and b) marketing efforts. Let’s break down what each of these terms means and how they differ.

• Sales generated leads (SGLs) - SGLs are leads generated by the sales team through existing relationships (with existing or new customers), meetings at trade/industry events, or strategic contact with potential prospects through tailored emails.
• Marketing generated leads (MGLs) - represent contacts who've engaged with your marketing team's efforts. An example of an MGL is a contact who fills out a landing page form for an offer.

This chart below encapsulates the process of lead generation and conversion. The focus of this article is SGL. A detailed introduction to MGL is set out in a separate article here.

Please note that sometimes the industry refers to SQLs and MQLs. In this context, MGLs are similar to MQLs in that these are leads generated by marketing efforts. However, SQLs relate to Sales Qualified Leads after marketing ‘hands over’ MQLs to them for the sales team to further qualify the opportunities. This article is not referring to SQLs which is covered under opportunity qualification once a lead has been generated either by the sales team or marketing efforts.

How sales teams can generate leads

There are multiple ways$^1$ to generate leads through your sales teams.

1. Targeted email campaigns: This involves sending tailored messages to B2B business leads outlining the pain you solve, how you did this for other similar customers in the prospect’s industry and requesting a potential conversation. With increasing engagement with the prospect, the emails should be more personalised to the prospect. See more below under Prospecting for sample intro emails and follow-up messages.
2. Social selling: As the name indicates, this refers to following B2B leads on social media, engaging with leads and developing relationships over time. In the B2B space, the major social media network is LinkedIn and we would recommend this over the other social media.
3. Trade conferences/industry events: Trade conferences offer a unique opportunity for B2B software businesses to meet potential sales-qualified leads. They provide a platform for direct interaction with decision-makers, fostering relationships and understanding client needs. Prepare by researching attendees and setting up meetings in advance; present your software solutions, tailored to the audience’s needs; network to build relationships beyond the conference; and follow up after the event to nurture leads. Remember, the goal is not just to sell, but to build lasting relationships that lead to sales.
4. Customer referrals: See more below.
5. Cold calling: Telephoning B2B leads, and explaining the benefits of your product or service is another form of outbound sales effort. We frankly haven’t seen this work very well but this is an option you could consider if you have the time and resources to dedicate to sales efforts.

You can choose one or more of the forms above that work best for you. Cold calling is not so commonplace anymore. It is less likely to be a productive option to generate SGLs for complex B2B software sales. In general, we have seen targeted email campaigns work the best individually and cost-effectively. Although LinkedIn could be a great source of content marketing, when it comes to generating conversations, we have found that LinkedIn does not work as well as targeted emails.

Customer referrals

Referrals stand out as a premier channel for acquiring leads due to their superior quality and the trust associated with them. At the inception of any B2B sales journey, building trust with prospects is the key to success. This trust can be earned through strategic moves such as offering free giveaways, sharing valuable content, and establishing authority through expert positioning. However, an often overlooked avenue is the power of borrowed trust aligning your company with individuals and organisations that your ideal customers already trust. The impact of borrowed trust is profound, with 92%$^2$ of people expressing trust in recommendations from those they already know. This sets the stage for the importance of customer referrals in establishing and reinforcing trust throughout the sales process.

Customer referrals, often an untapped goldmine, emerge as one of the most cost-effective and efficient channels for lead generation in the B2B software realm.

Intentional and systematic referral approach - To fully harness the potential of customer referrals, B2B companies must approach them intentionally and systematically. This is especially true for companies with high Net Promoter Scores (NPS), robust customer retention rates, and solutions boasting a high return on investment (ROI). These factors create a fertile ground for capitalising on the referral channel.

• Implement a formal referral program - Establish and promote a formal customer referral program with incentives. Target your happiest, most loyal, and engaged customers, sweetening the deal with incentives such as a low-cost/high-touch gesture (e.g., lunch at their favourite restaurant) or a free month of service.
• Leverage ‘Net Promoter Score’ surveys - Actively seek referrals from "promoters" identified through Net Promoter Score surveys. When a positive NPS survey is received, trigger an automated email or phone outreach to ask satisfied customers for recommendations to their industry peers.
• Utilise LinkedIn connections - Identify high-value prospects and determine which of your current customers have connections with them. LinkedIn's "Connections" feature is a powerful tool for this purpose, facilitating strategic introductions.

As the saying goes, "It's not just what you know, but who you know," and in B2B software sales, the power of who knows you can be a game-changer. By intentionally and systematically tapping into this wellspring of recommendations, businesses can not only boost their lead generation efforts but also build a foundation of trust that is invaluable in the competitive marketplace.

Lead generation best practices

We have used our learning from the Sandler sales methodology$^3$ and our own experience on what works best. You can think of the lead generation funnel in three buckets:

• Prospecting
• Establishing upfront contracts
• Building conversations

Prospecting

Elevator pitch

At the prospecting stage, your sales team is trying to move ahead of the gatekeepers to start communicating with the decision makers. A good strategy will allow you to establish a touch point with the decision maker to establish an upfront contract.

At the prospecting stage, you should prepare the elevator pitch of your proposal that is specific to a target customer segment. This will cover:

• Introduction and company positioning - identify yourself, your company and in broad terms what you specialise in, for what type of clients/Job roles/Industries – in English without using jargon.
• Overall benefit or pain statement - give a special feature or particular pain solution that differentiates your product service or company.
• Pattern interrupt e.g. You might not need our help.
• Pain statements - mention 2 or 3 surface-level pains that you can cure, that may be present in the prospect world.
• Hook question - identify a pain to explore.

In our experience, a prospecting email has a high chance of generating leads if it includes some key elements. Let us illustrate the elements with an example.

Good prospecting emails embody the above elements and as a result, grab the attention of the target audience.

In your CRM, you may want to consider tracking all your “cold contacts” in the following categories.

• To chase: You have identified potential targets/prospects (i.e. individuals within an organisation) but you have yet to make first contact
• To re-reachout: You have spoken to this contact before and it is time to re-reachout.
• 1st contact: after sending the first email and Linkedin request (until they respond)
• 2nd contact: If no response after a certain period, then they will move to second contact (after sending the second email).
• 3rd contact: Email or LinkedIn "Is it worth chatting?". If they do respond then move to qualified LI/Email. If they don't respond, send a fourth email and move the status to "No response".
• 4th contact
• Awaiting intro: We are awaiting an intro to this person from a known contact.
• Awaiting meeting setup: If you are exchanging emails with the contact but a meeting has not been set up.
• Meeting setup: A meeting has been set with the prospect.
• Meeting done: Meeting completed and either create a new opportunity or set a reminder to re-re-reachout again in six months (or longer) depending on the contact.
• No response: no response after four attempts.
• Not interested-go away: The contact has sent you a note not to contact them again.
• Not interested-stay in touch: Contact has politely declined your meeting but has asked to stay in touch with you.
• DNC/NA: Do Not Contact or Not Applicable.

Reach out cadence

• Reach out timelines 1st to 2nd reach out - 7 calendar days
• 2nd to 3rd reach-out - 14 calendar days
• 3rd to 4th reach-out - 21 calendar days

Establish upfront contracts

You sent out this perfectly crafted prospecting email and received responses from decision makers at your dream B2B prospect, now what? Soliciting responses at this stage does not mean you have moved onto the conversation stage. You need to establish up-front contracts. The key idea behind Up-front contracts is to avoid misunderstandings, wasted time, and friction in the sales process by openly addressing important aspects of the sales relationship early on. This upfront communication helps set the tone for the entire sales interaction and encourages a more transparent and mutually beneficial exchange. The five elements of an up-front contract$^3$ are:

1. Purpose - Clearly explain the meeting/call's purpose to propel the selling/relationship process forward.
2. Prospect’s agenda - Uncover the prospect's meeting/call agenda and expectations, clarifying perceptions and next steps.
3. Salesperson’s agenda - Outline your actions in the meeting/call, express expectations from the prospect, and demand clear responses.
4. Time Management - Set a specific time for the meeting/call, ensuring adequate coverage of all agenda items.
5. Outcome Agreement - Secure a mutually beneficial decision to either proceed or halt the selling process with a new prospect, establishing clear next steps. Ensure agreement at each stage with no room for confusion.

You typically send out an email that encompasses the five elements above ahead of the meeting/call. Here is what a sample email would look like.

The tone, style and content may change but the principles are solid. When in front of the prospect, relax and let it happen. However, do a debrief afterwards e.g., did I get a clear outcome? There is no standard template here just use a systematic checklist of debriefing questions customised to suit your needs.

Not all meetings move on to the next stage. Prospects may stop engaging with you. A good follow-up strategy before closing the file involves writing an email that includes a direct but not rude statement that equates to ‘based on the way you are behaving I can only assume that it’s over’.

The standard template could be:

Conversations

Conversations take time. After the leads have been qualified and touch points have been positive, they move on to the ‘Conversations’ stage. This is where the direct communication between the sales team and the qualified leads takes place. These conversations often involve discussions about opportunities, using the Sandler method or BANT (Budget, Authority, Need, Timeline) framework, and selling strategies.

After initial discussions, the Sandler style process involves diving deeper into pain points (designed to uncover the prospect's challenges, needs, and pain points) and then into the budget (to determine whether the prospect has the budget and resources available to invest in a solution).

In our experience, it could take between six and nine months to reach the conversation stage. Until customers have a conversation with the sales team, they have likely been sitting with the pain point for years. It has been latent pain, not an immediate one. B2B software buyers choose to buy to reduce pain. They do not buy software because they get more benefits. This is because there's a risk of buying the solution, deploying it, integrating it and making sure one doesn't lose one’s job in the process.

Therefore, in your conversation with the leads, if you find that they have a problem that they've been living with for say three to four years, then the question is: How urgent is it to solve the problem? If the problem requires immediate solving, then it is indeed an opportunity. If it isn’t urgent it isn't an opportunity yet. It stays as a conversation until the latent problem requires immediate solving. Despite the lack of urgency, the sales teams should use conversations at this stage to take good notes of the situation, and the overall expectations. Your sales teams should also use the conversations to confirm availability and reassure the need to solve.

Winning

The final stage of the journey is ‘Winning’, which represents the successful conversion of a lead into a customer. This is the ultimate goal of the process, signifying that the lead has gone through the qualification stages and has decided to purchase the product or service. From the time of having qualified leads to winning the customers. it could take well between six months to a year or even more than a year in some cases. You can refer to our insights on opportunity qualification.