Sales Prospecting Vs Lead Generation: which is the better strategy?
Do you have a sales team that is struggling in deciding if sales prospecting or lead generation is a better strategy? Do you want to optimize your sales team and take advantage of both strategies? The first step is understanding the difference.
Sales prospecting is the traditional strategy. That means the company comes up with a product and decides who the customer should be. Then the sales team is required to approach the prospective customer and initiate contact, create interest, handle objections and close the sale. This is also called outbound marketing.
That strategy meant you cast a wide net and catch a few sales. Over the years new strategies have been developed to make sales more effective by attracting the customer to the brand and to the company’s products which means the initial contact is from a customer who is already interested reducing the sales process and ensuring you contact interested customers. This process is leads generation strategy.
This article compares the difference between sales prospecting and lead generation.
Prospect vs Lead:
A prospect is the target customer who the sales team targets as potential customer. This is usually outlined by the company strategy.
A lead is a potential customer interested in your brand and has taken some action like sharing their contacts, visiting your website, downloading your report, and registering for your free trial.
Lead generation is an automatic process that involves placing a lead magnet to attract your customers’ attention and spark interest in places they are likely to see your brand on social media, websites, blogs, emails, and other digital platforms.
“78% of salespeople who use social media close more business than those who don’t”
Sales Vs Marketing:
The major difference between Sales prospecting and lead generation is that prospecting is led by the sales team while lead generation is the result of marketing activities.
Sales teams are more concerned with the sales process of prospecting, qualifying customers, presenting, handling objections, and closing.
While the marketing team I more concerned with Brand awareness, enticing the customer to make consideration on the product by providing relevant solutions and information, converting the lead to sales, and maintaining a good relationship with the customer for future sales or cross-selling.
Manual Vs Automated Processes:
Lead generation is when the marketing team attracts potential clients using automated processes that led the customer to do an activity like share their contacts, click on a link for more information, or call to make an inquiry.
Prospecting is when the sales team looks for potential customers using manual activities like listing 100 people you know, cold calling, knocking on doors, and calling your relatives, friends, and strangers to sell your product or service.
This means you go through the list of people you know or buying leads list. However, this is a very difficult method because it is noted that it takes 8 cold calls before you reach a prospect and another 4 calls before they become a sale.
Qualifying the Prospect Vs Leads
The salesperson qualifies the prospect as a potential customer after analyzing their needs. Having a long pipeline is essential in sales because we deal with a game of numbers.
That is the more people you contact the better the chance of closing sales with some of them. This strategy has worked for many years with many brands.
Statistics indicate that 40% of salespeople find the prospecting stage the most difficult because it requires persistence, and a lot of patients, not to mention a thick skin to handle rejection.
“80% of sales require 5 follow-up calls after the meeting. 44% of sales reps give up after 1 follow-up.”
Lead generation is automatically qualified because the customer makes contact with the brand through the lead magnets placed strategically to attract interested customers.
With lead generation, you only contact the people who have expressed interest in what you are selling. The trick is to contact people who are already qualified as potential clients. This is done by attracting interested leads and converting qualified prospects.
Personalized vs Digital approach: Sales prospecting takes longer and involves more activities that involve personal contacting your customer, understanding the customer’s behavior, and nurturing a relationship that will last longer than the lead generation strategy.
Both sales prospecting and lead generation are valuable to a business. Successful companies integrate both Sales prospecting and lead generation to optimize their salesforce.
To forge great personalized relationships with customers for future referrals and cross-selling sales prospecting is ideal.
Lead generation makes it automatic to contact potential customers using digital marketing.
Do you use sales prospecting or lead generation strategy for your sales? Which one do you prefer? Tell us about your experience in the comments!