Higher Quality Leads: Understanding RFQ (Request for Quotes) Role in Lead Generation

Transcription

1 Higher Quality Leads: Understanding RFQ (Request for Quotes) Role in Lead Generation

2 Executive Summary A request for quotation (RFQ) is interest you receive from a prospect in the goods and services that your company offers. With most RFQ s, your prospects are asking for you to provide a specific price for some type of service, given a variety of set parameters. The request typically includes information such as detailed contact information, desired contract length, requested payment terms, quality level of each item and other requests made during the bidding process. An RFQ is the highest quality lead you can receive which also provides the best sales results. Lead generation is a top priority for any business; increasing RFQ opportunities is the way to get there. Of course, taking the time to set up and nurture RFQ s can be time-consuming, but a proper understanding of RFQ s can help to reduce or eliminate the anxiety of trying to generate more productive leads. If you are involved in the lead generation activity in your organization, you may be dealing with low conversion, sales complaints, quality issues, new channels and more. The good news is that adding RFQ leads into your program can help solve all of these issues. What can RFQ s do for your organization? They ll provide your sales team with a steady flow of leads from companies that understand the RFQ process, how it can benefit them and want to investigate what it could do to improve some area of their business. Why are RFQ s so important? They can generate more sales, higher rates of profitability and connect you with more potential customers. RFQ s should be a part of your marketing mix today. Ready to find out more? Lets get into it Higher Quality Leads: Understanding RFQ (Request for Quotes) Role in Lead Generation 2

3 I. RFQs: The Basics An RFQ contains a detailed list of all parameters related to the purchase. These can include: Quantity Quality Personal skills Descriptions Terms and conditions Part or service descriptions Draft contract Specifications Delivery stipulations and requirements Value added requirements And more RFQ isn t just a request for the cost of each item or service. The RFQ often includes additional details such contact terms, payment terms and other specifics of the products or services to be provided. Most RFQs include price per item or the price for each specific service provided. A detailed description of all items and services is usually included to make sure that all suppliers clearly know what they are bidding on before placing a bid. Usually, the more detailed the RFQ is, the better the results you get back. Another reason to be detailed is for legal reasons. Some suppliers consider a request for quote a legally-binding certification. Adding details later can result in certain issues or even a misunderstanding about what is to be provided. The next step is for the suppliers to return their quotes by a date and time that has been predetermined. RFQs received after the preset date are usually rejected in order to keep everything fair. RFQs aren t set in stone. Further negotiations or discussions can take place when it is clear that both parties are interested in arranging a final deal. This is the time when any initial errors are corrected and any technical details are spelled out. This is also the time for either party to request additional information. If you get to this point, it is very likely that a final deal will be worked out. A request for quote tends to even out the playing field since suppliers bidding for products or services know they are competing with others. RFQs are typically used in business dealings, but are sometimes used in domestic transactions. RFQs are related to the following: Request for Tender - An offer to supply goods or services against a specific monetary amount. Request for Information - An open inquiry seeking additional information about a product or service or the market in general. Request for Proposal - A request for a specific solution(s), sometimes it is preceded by a request for information. Request for Comment - Request for an answer to a question or a comment on something concerning the product or service before making an official request for quote. RFQs are usually supporting documentation for sealed bids. These could be single-round bids or multiple-round bids where bids are submitted until one is accepted. Sometimes, this process takes place before an electronic reverse auction. Lead Generation To get a better understanding of RFQ, it helps to understand lead generation. First of all, a lead refers to anybody who has expressed interest in purchasing your product or service. Lead generation is the first step in the sales cycle. Lead generation is simply the practice of soliciting inquiries from potential customers. In other words, generating some interest in your product or service. RFQ is the best kind of lead because your prospects want to know what it would cost to use your service or buy your products, which probably means they are seriously considering using your services. Its not simply an inquiry, it s a possible intent to buy! And then there is the quality vs. quantity thing. It s not Higher Quality Leads: Understanding RFQ (Request for Quotes) Role in Lead Generation 3

4 so much about how many leads you have; it s the quality of those leads. You can generate plenty of interest, but if none of those leads turns into a sale, what s the point? Just because you receive more quote requests, doesn t mean you will turn those requests into anything that will boost your business. Lead Source(s) Old School Lead Generation Live trade show bingo cards The basic types of lead generation include: Modern Lead Generation Web, , events (live and virtual), adwords Automation Leads Tab in CRM Marketing Automation Main Metric Number of Leads Contribution to Revenue Main Offer Raffle or giveaways Free content Content Style Vendor-Centric Unbiased, objective Content Types Relationship with sales Data sheets, whitepapers Icy Source: Whitepapers, webinars, podcasts, video, ebooks Warm and fuzzy Broadcast Advertising Lead Generation - This is traditional advertising methods such as radio and television. Online Lead Generation - This refers to any form of online marketing such as website or social networks. Direct Mail - This is sending out information, usually including a specific offer, to contacts from your database. This could be either previous customers or those who expressed interest in your product or service. You can also purchase a mailing list, but this isn t really as reliable as using your own database. Event or Trade Show marketing - This one only applies if you have a company that has a product or service conducive to trade shows or marketing events. This can be a great way to meet and greet potential prospects and even be a little more one-on-one. Seminar or Training - If you are giving a seminar or training, you already have an audience likely to be receptive to your product or service since the people attending such events are likely in your field. This is where you can show that your product or service is better than the competition. Your prospects are likely to be well informed. The key is to be just as prepared. The Funnel Effect The funnel effect is a term typically applied to lead generation, but it can also relate to the RFQ process as well. The term refers to how many leads you need to have to get productive results. In terms of RFQ, it means how many solid requests for quotes you need to receive to convert a quote into a complete purchase of an item or service. If you have 20 RFQs, for example, in a week, you might expect half of them to follow up and purchase your product or service. Other Forms of Lead Generation Source: In order to get quotes, you need to attract the right kind of attention. But what kind of attention are you getting? And how serious are the inquiries? Traditional lead generation techniques such as direct mail, radio and television advertising can still attract customers most likely to be interested in your product or service. But are they ready to buy? How much data are you really getting? They may go look at your website after they hear a radio spot or see a television commercial, but is that enough to seal the deal? Many times, its not. More personalized forms of lead generation such as seminars and trade shows tend to have an even more receptive audience. But you still have to separate the tire kickers from the solid leads. And that takes time and effort. The bottom line? It s all push marketing, the kind that push- Higher Quality Leads: Understanding RFQ (Request for Quotes) Role in Lead Generation 4

5 es the advertisement for your product or service in their face and asks them to buy. And you know what? People are really tired of being sold to. They want something different. What you need for maximum lead generation success is pull marketing, the kind that RFQ s can deliver. When potential customers volunteer to provide you with their contact information, as RFQ s do, its pure magic. What are the new types of pull marketing tactics? Content downloads like white papers, newsletter signups, and web seminar registrations, to name a few. Here are a few others in detail: refers to using carefully selected phrases and keywords to boost your website s ranking on search engines such as Google. In terms of generating leads and converting those leads to the RFQ phrase, SEO helps by directing potential leads to your online content. This is especially helpful if a potential lead isn t necessarily seeking out your business by name. If, for example, a prospect is searching for medical supplies, the right keywords and phrases could bring your company s website up on the search engine results page. This then leads a prospect to your site where they can browse, collect information, ask questions or request a quote. Downloadable Catalog - Your downloadable catalog, containing all products and services you offer, should be placed in the same general location as your RFQ button. The idea is to give a prospect another option if they aren t ready to request a quote. A user can download your catalog with one stipulation: In order to download your catalog, they must enter some personal data such as their basic contact information, the reason why they need your product or service and other little details that just happen to be the same kind of information you would require on your RFQ form. This can be a more informal way to attract a lead that isn t ready to act just yet. e-book - While you can t read your potential lead s mind, you can make some assumptions about why they might be hesitating to complete the process and ask for quote. Many prospects visiting your website may only be in the gathering information stage. In other words, they re doing their homework and seeing what their options are. There s nothing wrong with that. In fact, a well-informed potential customer can be easier to deal with than someone who has no idea of what they want when they initially contact you. An e-book can be downloaded to the user s electronic reader device or via any device or computer with access to the Internet. Your e-book could simply be a collection of information from your company blog or Facebook page. The idea is to provide details about your product or service and present yourself as an expert in your particular field. You want to throw in some call-to-action phrases as well. SEO-based Content - SEO, or search engine optimization, Online Brochure - This is the same concept as a downloadable catalog, just a shorter version. You are basically just giving the highlights of your products or services, but in a little more detail. Presentation is everything. This applies to every form of marketing and is especially important when it comes to lead generation. Not every call-to-action is going to generate a lead. This could mean that you need to find what actually does work for you, or that your call-to-action methods aren t very effective. Calls-to-action that aren t likely to convert leads include: Click Here - Why click here? If a prospect doesn t have a clear incentive to click here, they aren t likely to want to click on anything. Submit - Again, this is too vague. Sure, you want to keep it brief, but you also want prospects to know what they are submitting. Buy Now - Again, this is too vague. Buy what? Remember, you want your prospect to request a quote. If you are too vague about what products or services you are offering, you already lost that prospect. When it comes to all of these new, online marketing types of lead generation, RFQ s are clearly the highest performing. Why? RFQ s come with more detail, more intent and more data. Unfortunately, many companies still aren t using RFQ s. Why? Because many organizations don t fully understand them and know how to use them. Higher Quality Leads: Understanding RFQ (Request for Quotes) Role in Lead Generation 5

6 RFQ and B2B Lead Generation A request for quote form (RFQ) is intended for complex sales. This is the start of the sales cycle. The RFQ requests specific information from the requester. This includes basic information such as company name, contact name (usually the individual who has the authority to deal with RFQs), contact information such as phone number and address, etc. Complex Sales The term complex sales refers to lengthy sales due to approval required at several levels before a purchase is made. Complex sales generally involve a lot of back and forth between the parties involved. The process can take a few weeks or even a year or more. The true complexity depends on several factors such as the size of the companies involved, the purchase cycle and the number or products and services involved. You can t convert every lead, but understanding the way a potential lead thinks is a good start. Some prospects may not be ready to request a quote just yet. Others are simply doing research. You want to provide as much information about your product or service as possible. Granted, you can t always provide an exact quote or price unless you have certain information. Some prospects aren t so much concerned with the price as they are with other issues such ability to deliver on a certain date and the cost of extras such as installation. This is the purpose of a request for quote. You want to answer as many questions and concerns early in the game. Now that you understand RFQs and lead generation, the next step is to make RFQs work for your company. Higher Quality Leads: Understanding RFQ (Request for Quotes) Role in Lead Generation 6

7 II. Putting RFQs to Work for Your Company Having an understanding of RFQs doesn t really do much buttons. When a lead clicks Request a Quote they are for your company unless you know how to make RFQs work taken to a form where they provide the basic information for you. And the fact remains: Blending RFQ leads into your necessary to provide a quote. lead generation tactics will provide higher quality leads. RFQs tend to be most beneficial for services or products that Lead Generation and RFQs are standard within the industry. If you have a truly unique Lead generation isn t an exact science. It is, however, a product or service, you may receive quotes that are all over combination of efforts. Lead generation starts with solid the place. You want quotes to be somewhat equal. RFQs marketing efforts such as a well designed website. You then can lead to higher quality leads, especially if you understand need traffic to your site. Next, you need to narrow down your the concept of RFQs and how to make them work for your leads by location. This allows you to put more effort into find- company. Let s start with a look at how you normally engage ing quality leads. Ways to bring lead generation and RFQs contacts. together include: Call-to-Action 1. Create content that attracts leads - You can boost your Most businesses have a Contact Us page or form some- odds of attracting certain leads by offering the lowest price, where on their website. This is also a similar call-to-action the highest quality product or service and other incentives. technique used in other forms of marketing such as television For the rest of your leads, you re going to have to do some advertising and direct mailing efforts. While Contact Us can work. Incorporating techniques such as pay per click (PPC) be effective, there are better ways to engage your potential and Search engine optimization (SEO) to make your content customers. A more effective way to engage leads is to place more relevant and visible to potential customers. a Request a Quote button on your website. You can also use such a button on any social networks you may be using 2. Offer a practical solution to solve problems - The more for your business. You might want to incorporate a Request helpful you are to prospects, the more likely they are to either a Quote button with Ask a Question or other call-to-action request additional information or request a quote. You want Approved Index Search Advertising Marketing Telemarketing Direct Mail Print, Radio, Television Cost per customer Directly measurable ROI Actively searching for suppliers Full contact info (Phone, , address) Full purchasing requirements Time to setup Higher Quality Leads: Understanding RFQ (Request for Quotes) Role in Lead Generation 7

8 to use your knowledge and experience to present yourself as an expert in your particular area of business. Lists, video clips and how-to presentations tend to work best. In this case, your potential lead isn t likely to be searching for you. They are likely to be searching for a solution to a problem, but if you offer that solution you have yourself a possible lead. 3. Go beyond your initial offer - The best way to turn a lead into a customer is to offer something beyond the initial offer. This may include an additional discount or free shipping. Customers tend to like little extras, especially when they feel they are getting a special deal just for them. 4. Engage your prospects and let them get to know you - The better the relationship is between your prospects, the more productive your leads will be. Once a potential lead expresses interest, engage them with correspondence that includes attachments such as videos or additional information about your product or service. Encourage questions and start a dialog. This is even more productive if you establish a relationship with a particular contact person. The more personal your connection is, the better your odds of reaching the RFQ point. 5. Make it easy to share - Today s world is more connected than ever. That certainly applies to business. Incorporate all your online marketing efforts with your traditional marketing efforts. Make it easy for interested leads to share information about your company with others. This is a great way to find more leads without any major effort on your part, other than making it easy to share your content. Use buttons for LinkedIn, Twitter, Facebook, Google+, and any other social networks you may be using for your business. These buttons can be easily added to your website or blog. Stake Your Claim High quality leads don t grow on trees, you need to know where to look to find a productive lead. This is the key to making RFQ work for you. Even if you have a product of service that can be of use to anybody anywhere, it s best to start locally. Once you develop product leads that generate a significant amount of RFQs, you can expand your market nationally or internationally. You re not going to have successful request for quotes if you don t have a steady stream of new leads. Some ways to generate new leads include: Productive online searches based on SEO techniques Referrals from existing clients/customers Trade publications such as newspapers, journals and business publications Networking through conferences and meetings Connecting with local businesses in need of your products or services But what happens if you don t have the search engine traffic, onsite optimization, existing customers, networking time or social media prominence to get people to come to your site in the first place? What do you do if you don t have the time, resources or budget to go through steps 1-5 listed above? This is when outsourced RFQ s can work very well for you. And this is where Approved Index shines. As a lead generation company, we provide qualified sales leads in hundreds of B2B categories. Whatever it is you sell, and wherever in the UK you re based, we ll be able to connect you with buyers who are looking to purchase right now. Plus, all our sales leads are qualified by phone, ensuring that you receive the lead at the optimum part of the purchasing cycle. Things to Consider: How Big is the Market? Just like every other marketing tactic, its important to consider how large the market is for your product or service. If you have a very niche product or service, there clearly aren t as many people looking for it, so lead generation may be tougher. On the plus side, those that are searching for it are usually pretty qualified. Ever heard of long tail searches on the web? This is a four to six word keyword phrase such as content manage- Higher Quality Leads: Understanding RFQ (Request for Quotes) Role in Lead Generation 8

9 ment systems for small companies or software developers needed in India that someone would use in Google, Yahoo or Bing. Companies that are searching like this know what they are looking for and when they find it, are more apt to buy. If you offer a niche product or service or have a small market, Approved Index can still help you because hundreds of companies that are searching for these types of products and services are leaving RFQ information on our site. If the market is large, you probably have a lot of competitors. This can equate to lots of people looking for your products and services, but it also can mean that each of those leads are more challenging to secure because your competitors are working just as hard to get them as you are. As we ve mentioned before, you can certainly set your site up to be lead friendly, use SEO, produce great content and all the rest, but it takes significant time, money and people to make it happen. Approved Index can provide pre-qualified RFQ s that are targeted directly to your company. Which Companies Typically Use RFQ s? What Industries do RFQ s work well in? Computer Systems Content Management Systems CRM Systems Database Developers IT Support Network Installation Software Developers Marketing Direct Mailing Lists Lists Market Research Companies PR Companies Telemarketing Companies Video Production Business Services Business Phone Lines Event Management HR Companies Payroll Services Printing Companies Internet Ecommerce Web Design Internet Marketing SEO Companies Website Designers Website Developers Office Equipment & Supplies EPOS Systems Franking Machines Hot Drinks Vending Machines Photocopiers Telephone Systems Construction Air Compressors Cherry Pickers Steel Buildings Storage Containers Automotive Contract Hire Fuel Cards Vehicle Tracking Training Management Training Sales Training Six Sigma Training Pre-conceived Risks with RFQ s Reasons Companies Think They Wont Work Some companies out there simply think that RFQ s wont work for them. Some companies have tried them with the wrong provider and gotten burned. Others don t have much knowledge and aren t aware of just how powerful a market- Higher Quality Leads: Understanding RFQ (Request for Quotes) Role in Lead Generation 9

10 ing tactic they can be. RFQ is an underused lead generation tactic that compliments existing marketing activities, because it fills the pipeline with concrete opportunities. What are some of the other issues that we see? What do we hear from some new clients? Our existing marketing spend appears to be working ok, why change? The cost of not using RFQ s is much greater. In study after study, client after client, we have seen this prove true. Every company should at least try RFQ s to see if they work for them. 70% of the time, they will. The advantages far outweigh the costs. And RFQ s are an investment. Its true, a lack of knowledge can make any company a little risk adverse new marketing tools and tactics can be daunting, but the ROI is proof positive. Because stagnation is not innovation. In order to stay ahead of your competitors, you need to be doing everything you can to secure new leads. You need to uncover all the new opportunities, using all the tools in your marketing tool chest. We just feel that RFQ s are a big risk that it won t work for us. Its an added cost. RFQ s are just another type of lead, the highest quality lead in fact. There is nothing to be concerned about. They can take the place of weeks of sales work getting to proposal stage. Finally, they are driven by search engine traffic, so they are very targeted leads, leads that are active and ready to buy. Higher Quality Leads: Understanding RFQ (Request for Quotes) Role in Lead Generation 10

11 III. RFQs: Advanced Topics RFQs are the highest quality leads possible because rather than just receiving contact information and perhaps a download request, you get their contact information, exact quote information and a real intent to buy. But the quest for quality leads can be frustrating. Once you grasp the basic concept for generating high quality leads, you can incorporate some advanced techniques into your attempt to attract more productive RFQs. Often the extra effort makes a big difference. Keep in mind that you re not the only one trying to find high quality leads. Today s business market is very competitive. This isn t to say that there aren t productive leads to be found. It just takes a little more effort to find and nurture quality leads. If you use Approved Index for your RFQ s, of course, all of that work is done for you! What does a Quality RFQ Look Like? Once you find productive sources of leads, you need to gather the right information from your leads to turn them into productive leads likely to request a quote. RFQs often include the following additional fields: Contact information such as , physical address and phone number Website address and other online information B2B Firms - Marketing Priorities Name of a key contact person, usually an owner, purchasing manager or other authorized person Particular business field or sector of your lead Budget Buying timeframe Desired features Project details Project objectives If you don t want to take the time to set all of this up on your own or have the necessary traffic to your site, you can purchase a database of potential RFQ leads for your business. This option can sometimes be the best option. Approved Index can help you with this. How do you qualify leads? Which ones are good, which ones are not? Every smart company gears its sales force to converting RFQ s in big numbers. Ensuring that the marketing department and sales department work together to do this is critical. Qualifying leads is part art, part science, but doing it right can save a ton of money and time. The sales qualification tool known as BANT can get you there. Used by IBM for decades, it stands for Budget, Authority, Need, and Timeline. It means you should feel out the sales prospect to see if your product or service is affordable to them, fits a need they have, can be delivered in a timeline that works for both parties, and that the person you re pitching to actually has the authority to make purchasing decisions Source: MarketingSherpa, B2B Marketing Benchmark Survey, 2011 Be sure to ask the right questions of your sales prospect. Don t just jump in and start talking about how great your company is. Do something few salespeople do correctly: Higher Quality Leads: Understanding RFQ (Request for Quotes) Role in Lead Generation 11

12 Ask some detailed questions to ensure it s a good fit. You ll usually know in the first few minutes if this will be the case. Once you know for sure, you can take the conversation to the next level. How do you do that? With a genuine approach. A 2003 Gallup study indicated that there was a 12 percent more likely chance people will buy from you if you can create an emotional connection. If you can find out their pain points, frustrations and concerns, you may have yourself a customer. How do you become the leading RFQ s beneficiary in your industry? The first way is by understanding the power that RFQ s hold. Downloading this white paper was a great first step. Hopefully, you can now see the potential that RFQ s have for your companies marketing efforts. There is simply no better way to get great leads for your company. The next way is to beat your competitors to the game. Think about it: many of them are not aware of how significant RFQ s can be to the sales effort. By taking advantage of the tactic now, you can get a first mover marketing advantage in your industry. Approved Index works with many companies who own the RFQ s in their industry. For example, there are a few sub-categories in our directory listing where all the leads we receive are given to just one or two companies in that space, companies we work with who have seen the power that RFQ s hold. the companies they do business with. Picking up the phone, showing you care about their concerns and answering their questions is what it all comes down to. But how do you ultimately turn these RFQ leads into real live customers?... Summary Becoming a Sales Powerhouse: How to Turn Every Lead into a Paying Customer Finding high quality leads is more challenging these days, but it s not an impossible task. On a local level, word-ofmouth and reputation can help generate leads and drive your business, especially if you ve been in business for a while. But it takes work and lots of time. Content is really the key to attracting leads when you go beyond your local service area. But do you have the resources to develop it? You need to engage your leads and offer as much useful information as possible. A better understanding of the RFQ process is the first step in turning leads into customers. How do you turn every RFQ lead into a paying customer? By contacting the prospect early, further qualifying by asking good questions, showing how your products and services are better than competitors, offering a fair price and treating your customer well. It s that simple. The final way is to work hard to convert the RFQ leads you receive. At the end of the day, you are still selling to people and most people like to have a personal relationship with Need help getting the highest quality RFQ s for your business? Check out Approved Index. We provide this service for companies everywhere. Find out more today! Higher Quality Leads: Understanding RFQ (Request for Quotes) Role in Lead Generation 12

13 About Approved Index The mission of Approved Index is simple: to make the process of business-to-business buying and selling as simple, straightforward and cheap as possible. Since our humble beginnings in 2004, we ve matched thousands of buyers and suppliers through our tailored online service, cutting unnecessary time and cost from both sides of the purchasing equation for hundreds of companies. Approved Index is a division of Reed Business Information. Reed Business Information is Europe s biggest B2B media company. RBI brings over 100 market leading brands to an audience of 30 million decision makers worldwide through a multi-platform media of web products, magazines, exhibitions, conferences and industry awards. Higher Quality Leads: Understanding RFQ (Request for Quotes) Role in Lead Generation 12