Why You Have a Lot Fewer Sales Leads to Follow Than You Think Businesses often drastically underestimate how fast their customer information databases go out of date.
By Peter Daisyme Edited by Dan Bova
Opinions expressed by Entrepreneur contributors are their own.
"More leads!" Sales teams want them. Marketers spend their time and money trying to acquire them. However, in the race to hoard as many leads as possible, many businesses forget that quality trumps quantity. The result is a bloated database, filled with thousands of leads that that are unlikely to convert.
Effective sales and marketing teams take the time to build a leads database with accurate, data-rich customer information. However, even quality leads have an expiration date. The reason is data decay.
A growing problem
Across all industries, data decay is an ever-present problem. A business can source the perfect lead and incorporate it into their marketing or sales funnel, only to have the contact person take another job. Address changes and business discontinuations are two additional issues. According to NetProspex, 84 percent of B2B marketing databases are "barely functional" due to incomplete or erroneous data.
To make things more complicated, data decay is a bigger problem in some industries than others. Data for an industry with high turnover or that tends to be transient might decay far faster than an industry where change is far less frequent. Businesses should be aware of the typical decay rates for their specialty industries and put technology in place to keep data updated as often as needed.
Related: Here Is the Equation for Increasing Your Sales Team's Success
The impact of data decay.
Data decay has a direct impact on businesses, leading to wasted efforts from your team and seriously zapping your overall productivity. Making matters worse, the job market has gone through severe turmoil in recent years, leading to higher-than-average decay rates. Businesses that haven't revisited their mailing lists in a while may find their sales and marketing efforts are far less effective because of outdated information.
Over time, inaccurate databases can take a serious toll on businesses, starting with the time your employees waste calling outdated numbers. Employees look out of touch when they initiate contact by using the name of someone who is no longer with the company. Marketing emails may come across as spammy when they go to a person's successor, as well, putting a business at risk of being permanently labeled as spam in an organization's email system.
Related: Marketers: Your Sales Team Needs Leads, Not Inquiries
Preventing bad data.
To automate and streamline their marketing and sales efforts, companies are adding more and more data points to each contact in their database. Detailed information about a prospect's company, buying history, social media activity and many other points are being added to lead databases to provide more targeted messaging. However, the more data points that are added to a database, the more that can go bad.
It is extremely difficult to see the errors in a database without specialized tools. Someone can manually go through the list and research each contact, but that takes time. Depending on the size of a business's database, this process could require the attention of a full-time employee for weeks or months at a time. This effort could be better directed toward other activities.
Next steps.
You may be surprised by just how quickly your database is becoming outdated. LeadGenius offers a B2B database decay calculator that helps businesses estimate their data decay by industry. Often businesses are surprised by the results they see. By getting a detailed look at their own data decay rates, businesses can make decisions about where they'll go next.
Often once you gain insight into how your data is decaying, you can begin researching technologies to keep information up to date. Some solutions let you verify emails as soon as you get them or update contact info after it's been in your system a while. These solutions use the power of publicly-available data to keep databases updated with little human effort required.
Dead-end leads are an ongoing problem for companies. Fortunately, there are many tools available to help. Businesses should gain insight into the challenges they face within their own industries, as well as those challenges unique to them, before making a decision on how they'll avoid data decay.
Related: Why 'Smarketing,' or Integrated Sales-and-Marketing Strategy, Is the Future for Small Business
