Optimizing the Online Acquisition Pipeline
Today’s customer acquisition process is more sophisticated than we imagined even five years ago. New information channels spring up daily (i.e. podcasts, social networking, blogs, etc), and more and more marketers are in the race to leverage these channels to tell their stories
As the Internet continues to be the the As the Internet continues to be major driving force behind thisthis process, majordriving force behind process, building a trulytruly comprehensive online building a comprehensive online strategy is becoming critical to your strategy is becoming critical to a bottom line. New opportunities are opening business
up that didn’t exist in traditional marketing channels—opportunities that provide improved communication channels for businesses to connect with customers.
Your competitors are already considering the trends— healthcare Internet is Internet advertising
advertising isto continue an average 25% expected expected to grow by an average of 25% this year, topping $1 $1 year-over-year increase, topping billion in 2007. Home medical equipment and durable billio
medical equipment providers are realizing that a comprehensive online strategy can positively impact growing customer acquisition goals.
US Pharmaceutical and Healthcare Online Advertising Spending vs. US Total Online Advertising Spending
2003 2004 2005 2006 2007 2008 $291 $576 $625 $835 $1,015 $1,410 2003-2008 (Millions)
Pharmaceutical & Health Care Total
$7,270 $9,600 $12,500 $16,700 $20,300 $23,500
Note: eMarketer benchmarks its online advertising spending estimates against the interactive Advertising Bureau and PricewaterhouseCoopers (PWC) Source: eMarketer, August 006
So how does an HME/DME provider leverage a relatively new and unpolished marketing channel? This paper will examine a few simple tips to consider if you’re looking to enhance the customer acquisition process and accelerate customers through to purchase, including: • Sourcing the Lead • Managing the Inquiry • Auditing the Pipeline • Incubating the Lead • Closing the Loop
The Customer Acquisition Pipeline
Sourcing the lead
Finding a valuable lead source to tap into is a crucial first step in the customer acquisition process. Fortunately for HME/DME providers, you don’t have to look very far to find their audience—8 in 10 Internet users are turning to online resources for information related to their health or the health of a loved one.1 The appetite for information is constantly growing, and consumers are more aggressively pursuing answers previously available only through a healthcare professional.
US Internet Advertising Market Size By Segment, H1-2005 versus H1-2006
Other Email $375 $116 Other Email $317 $158
Rich Media $463 Lead Generation $347
Rich Media $475 Lead Generation $592 Search $2,315
Search $3,164 Classified $1,582 Banners $1,622
Classified $1,014 Banners $1,157
2005 (Millions)
Source, IDC, 006.
2006 (Millions)
1 Fox, Susannah. Online Health Search 006. Washington, DC: Pew Internet & American Life Project, October 9, 006.
More importantly, new technology enables HME/DME providers to reach this targeted audience and acquire sales leads online. Online lead generation represents the fastest growing segment of online advertising, showing a 71% year-over-year growth to $9M in 006. No other media channel can connect consumers and providers faster and more accurately than the Internet. Sourcing leads online can be expensive and difficult to achieve given a highly fragmented world of banner advertisements, the multitude of compelling online offers, and the barrage of junk mail proliferating through the Internet community. A certain level of technical expertise and understanding is necessary to optimize the components of an online marketing campaign. The payoff, however, can certainly make it worth stepping into an area that may be outside the comfort zone of traditional lead sourcing activities.
By complimenting traditional lead sourcing activities with a thoughtful online marketing strategy, you are tapping into a different type of audience – an audience actively searching for information on the products and services you sell. Sourcing Internet leads puts you in front of the consumer before your
competitor, affording you the opportunity to establish the initial dialogue with prospective customers. To compare options, leads culled in an interactive environment come from highlymotivated individuals who take the time to find content-rich resources addressing their health impairment. When these individuals submit their inquiry on a Web site, they do so with the expectation that something is going to happen quickly.
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In-house
vs. Models Outsource
If your organization is in a position to train an in-house staff with cutting-edge online technologies and practices, there is an opportunity to increase your online lead sourcing capabilities. Over time, an in-house model lends itself to efficiencies through repetition and familiarity with the business—efficiencies that equal time savings and an accelerated customer acquisition pipeline. This route requires an established base of technical expertise and/or a dedicated budget sufficient to cover both the training and media purchasing components. The average HME/DME provider with large growth projections and limited technical know-how has alternative options. A group purchasing organization (GPO) offers significant purchasing power through its members’ numbers. As an outsourced service, GPOs can provide immediate access to hundreds of partner and self-owned Web properties generating large amounts of Web traffic. This model removes the prohibitive cost a single organization faces when trying to build a single online brand. A GPO approach can also help organizations control technical overhead costs by limiting the amount of technical resources a member organization needs. For the less experienced HME/DME providers, finding a partner organization could be a good first step into the unknown.
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Managing the inquiry
Since the Internet affords consumers the opportunity, the lead data compiled at the beginning of the acquisition process needs to be viewed as a perishable commodity. Interactive leads are like hot bread that cools quickly—they can and will go stale. Try to enable near real-time connectivity with each response. Contact the leads quickly to ensure the best opportunity to close every prospect before a competitor has the opportunity to initiate the acquisition dialogue. (Remember, the consumer typically respond to more than one web site.) An HME/DME provider needs to keep in mind they are often calling a prospect that most likely has a health impairment that may make it difficult for them to maneuver to the phone. Many of these individuals also receive in-home medical care, meaning there may be times they are unable to make it to the phone. Patience is a must with these prospective customers as it can often take ten times or more to reach an interested prospect. A disciplined calling structure and a bit of
patience yields attractive lead conversion rates.
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Implementing an
to Interactive Respondents
1. Call quickly. 2. Call often. 3. Vary the times and days that you call.
Outbound Call Strategy
You cannot always call on Tuesday morning between 10:00 am and noon and expect to reach everyone. You have to put together a call schedule that alternates mornings, afternoons, evenings, and Saturdays.
4. Use a system to record the details of the call.
This allows your efforts to be cumulative. Consider using contact management software like Goldmine or ACT! if you don’t already have a system.
5. Introduce yourself so that the person you are calling 6. Use a script
Write out all the questions you need to ask in advance, and be sure to cover each of the checklist items.
can connect your business with the advertisement for which they responded.
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7. Follow up. Follow up. Follow up.
Auditing the pipeline
A well-maintained sales pipeline provides clear focus on leads that can and should convert to sales. By periodically auditing the sales pipeline for accurate sales data and lead quality, immediate sales opportunities become more apparent. The result: • Increased close rates • Time spent focusing on high quality customers and prospects • Improved sales reporting and forecasting • Non-leads removed from the pipeline Without a basic criteria and segmentation strategy in place, time and resources are spent sourcing and speaking to low-margin, time-consuming customers that may or may not purchase. Not only are there hard costs associated with this, but it’s tying up time that could otherwise be spent closing the deal with higher quality leads. Understanding your customer/prospect base will facilitate better pipeline audits by defining where your sales focus should reside. Define what drives customer purchasing decisions and begin putting corresponding criteria in place that gauges how hot (or not) a customer really is or can become. In other words, put a grading system in place and flag your contact database accordingly. By classifying your database, you can quickly audit the pipeline and accelerate hot prospects through the pipeline first, warm leads second, and lastly the cold leads.
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Incubating the lead
Many HME/DME providers spend time and resources sourcing leads that fall out of the pipeline process. Not every lead is going to become a sale right away, but that segment of the database can be a true goldmine. The question then becomes what to do with the individuals that have dropped out of the process during the pipeline audit. An internal contact database such as Goldmine or ACT! is a valuable asset in the customer acquisition pipeline. The contacts in the database are individuals that have at one point responded to an offer and expressed interest in your products and services. By auditing the pipeline and putting together a simple
lead incubation program, you are able to take those leads that drop out of the pipeline audit and place them into a program that allows them the opportunity to mature.
A successful lead incubation program will also take into account cross-selling opportunities. Successfully identifying and segmenting your prospect database will significantly impact the margins on each lead you’ve been able to produce. This not only pushes leads through quicker, but it provides what should be a lowmaintenance, semi-automated safety net to catch leads that may otherwise drop out of the acquisition process. Without a lead incubation program, a business may spend double or triple the amount of money trying to source the same lead again.
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Closing the Loop with Lead Incubation Programs
Implementing a lead incubation program allows you to extend a closed loop system to the traditional customer acquisition model. Leads that previously fell out of the pipeline stay in the sales system and resurface once they mature and express additional interest.
Customer Acquisition Pipeline
Lead Incubation Program
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Close the loop
By regularly communicating with your database, you’re providing continued communication and generating sustained interest in your products and services. While it is always important to source new leads and contacts, it’s equally important to utilize the assets you already have. Customer referral programs and preferred membership discounts are examples quality lead incubation programs designed to maintain regular dialogue between the consumer and the HME/DME provider. Closing the loop on the customer acquisition process pushes your customers through the funnel faster and, at the same time, helps to minimize customer attrition. This creates efficiencies around your marketing programs because it allows you to focus on driving new business and expanding your reach.
Summary
Your online strategy today will impact what your business can and will look like tomorrow. By keeping the online acquisition pipeline model in mind, you’ll start to realize how and where your sales and marketing programs can make significant contributions. Optimizing the online acquisition pipeline is a constant process. The goal is to keep your company at the forefront of shifting market conditions and adjust accordingly.
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Understanding what your pipeline looks like will allow you to continuously make the adjustments you need to stay on top. For example, what impact will certain Medicare regulations have on your customer acquisition? What steps will need to be in place or improved to maintain compliance? Knowing what your pipeline looks like today will help you put scalable models in place that allow you to quickly adapt to changes in the market landscape. Scheduled pipeline audits constantly provide new and valuable information that will otherwise go unnoticed. Better understanding who your customer is and what their needs are will position your business to meet those needs and develop ongoing customer relationships. Audits will also help provide the data you need to truly profile your customers. Doing so will provide a disciplined focus on higher priority consumers and will help to minimize the lower priority segment who is simply ‘window shopping’. Generating leads can be costly and time consuming. A successful lead incubation program will allow you to maintain regular contact with leads that may have dropped out of the pipeline process. Keeping an open dialogue with these individuals plays a vital role in accelerating the entire customer acquisition process.
In the end, theIn the end, the combination simple simple suggestions can haveconsiderable combination of these of these suggestions can have considerable impact on your business’s customer acquisition model. By increasing the speed impact on your business customer acquisition model. By increasing the speed at which individuals move through your pipeline, begin to generate true at which individuals move through your pipeline, you you begin to generate true growth growth in yourin your busin The potential to do this in a sizable and scalable way is available business.
to you now – on the Internet. Utilizing this tool as a valuable customer acquisition channel will accelerate your business as quickly as your infrastructure will allow. A well-planned and thoughtful approach to your online strategy is worth the investment and will continue to pay dividends well into the future.
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