Here's How Nurture Marketing Doubles Lead Acquisitions and Cuts Cost Per Lead in Half
Highlights
- Research findings show that 49 percent of new leads are not sales ready when acquired but successful nurture marketing campaigns will convert 72 percent of those leads to sales-ready. That is equivalent to doubling the volume of qualified sales leads sent to the salesforce and reducing the cost per lead by half.
- The research found that on average, it takes 9 nurture marketing touches to convert a lead to sales-ready. The data also demonstrated that certain campaign techniques reduced the average number of touches and increased conversions.
- The research found that the average period between campaign distributions was 11 days. However, that figure varied in relation to the sales cycle duration.
Research Findings and Benchmarks
After completing the most recent lead management research for the Marketing Transformation Report we found ourselves with some new questions.
So, we followed up with a research survey focused exclusively on nurture marketing campaigns and results.
Lead Acquisition Purchase Readiness
The research found that among Business to Business (B2B) companies, on average, 26 percent of acquired sales leads were sales-ready, 49 percent were not yet sales-ready and 25 percent were unqualified. It's that middle segment of not yet sales-ready leads that is either cultivated until they become sales-ready or lost to lead leakage.
The research also found that only 37 percent of respondents employed active nurture marketing campaigns. But among that group 72 percent of the not yet sales-ready leads became sales ready in 6 to 11 months, on average.
When you extrapolate these results, the data shows that nurture marketing campaigns can produce more leads from the not-yet-qualified volume than were obtained in the initially qualified group. That doubles the number of total leads sent to the salesforce, cuts the cost per lead in half, and creates a high impact revenue growth opportunity that goes untapped by most companies.
Research shows that companies with active nurture marketing campaigns double the volume of qualified sales leads and reduce the cost per lead by half.
Click to Tweet / XNumber of Touches to Conversion
We wanted to know how many touches are required to convert a not yet sales-ready lead to sales-ready. We also wanted to know the factors that most influence that result.
The research found that it took 9 outbound interactions, or touches, on average to convert a lead to sales-ready and transfer it to the salesforce.
For example, when the campaign advanced from only email distributions to multi-channel engagement, the number of touches to conversion decreased from 9 to 7 and the conversion rate increased from 73 percent to 77 percent.
While the conversion rate increase may seem relatively small, when applied to a high volume of sales leads, the result is a substantial increase in the volume of qualified leads delivered to the salesforce.
Similarly, when the campaign was combined with Display and Retargeting the number of touches to conversion decreased from 9 to 6 and the conversion rate increased from 73 percent to 79 percent. Among the 7 nurture marketing techniques we tested, the data showed that Display and Retargeting were the most influential factors to decrease interactions and increase lead conversions.
The research reinforced nurture campaign best practices that have long held the combination of content types and communication cadence impacts conversions.
Campaign Cadence to Conversion
Finally, we posed several survey questions to identify the frequency of outbound interactions, or what is often referred to as the nurture cadence.
The frequency of interactions is important because when email or other interactions are sent too infrequently the sender fails to gain top of mind awareness. But on the flip side, when sent to frequently the interactions are likened to spam and the unsubscribe rates increase.
The data found that the average frequency of distributions was 11 days. However, it also demonstrated that the average frequency varied pursuant to the sales cycle duration. In the following graph we plotted the average interaction frequency with average sales cycle duration.
About the Survey
This research was conducted using an online survey. All participants identified themselves as sales and marketing professionals in a Business to Business (B2B) market. This was a pre-qualifier to participate in the survey.
Respondents were given the option to respond anonymously, and all respondents were assured their identity and responses would remain confidential. A prize drawing was offered as an incentive for participants who provided their contact information.
The survey consisted of 18 questions. Respondents were given the option to not respond to questions they deemed not relevant or did not know the answer. The total number of questions may differ among respondents as based on a given survey response, a participant may be posed additional or cascading questions. The total number of responses for each question is published with the result. Certain questions permitted multiple responses; therefore, response totals may not sum to 100 percent.
The composition of respondents included the following roles and firmographics: 73 percent of respondents identified themselves in a marketing role and 27 percent in a sales role; 32 percent of the companies identified as publicly traded companies and 68 percent as private.