The transaction and management of customers is a significant part of any business. It involves lead generation, sales, and business development. And all of these tasks are completely different, requiring different skills and mindsets. However, many businesses either don’t understand the difference, or expect one team to have multiple competencies as a way to save money. The fact remains that they are distinct from one another.
Business development requires playing the long game. A big part of business development is identifying new prospects, researching everything possible about them, establishing whether or not they’re a good fit for the company, and then starting the communication process. Business development reps have to leverage the prospects and convince them to buy.
Lead generation, in contrast, is wholly different. Employees involved in lead generation have a list of questions they need answers to, and a stack of phone numbers to call. They’re not trying to build relationships, they are only interested in high conversion rates and passing stellar leads to the sales team.
Which brings us to sales. If your sales team has to worry about generating leads as well as building relationships, they’ll never get to the selling part. Their role is focused upon delivery of the service or product that was promised at the start. However, they also need the customer to keep coming back to them, so they have to develop a value proposition that positions them and their company as the customer’s first choice.
Now that you have a better idea of what business development, lead generation, and sales really are, which one of them comes first? Let’s put it this way, sales is always last. To demonstrate, assume your company has a new product. Most likely, the new product was developed in response to in-depth market research, market analysis, etc. Which means that as a company, you have a pretty good idea of who is interested in the product, even before you develop it. So, can you sell this product immediately? The simple answer is no.
Your target audience for the new product doesn’t know you exist, or it doesn’t know the new product exists. And you need to get to them somehow. This is when your product managers and marketing team, who really understand the target market, will start working with your business development reps to devise a sales strategy. The strategy includes a sales tactic, which is used by the lead generation team.
That’s when we really start to see the key differences between business development, lead generation, and sales. Your business development manager was probably working with some of the prospects, for this new product, even before it was ever conceived. Because their role is to introduce your business to new prospects and nurture them until they are ready to buy something. Once a new prospect has fallen into the sales funnel, the lead generators come into play, and concentrate on the sales pipeline, revenue, and qualifying the prospects.
Lead generation doesn’t directly influence revenue, but definitely impacts it indirectly. They take the prospects who have just been tipped into the sales funnel and employ their tactics to drive them through all the way to decision making. This is referred to as the sales cycle, and can include anything from cold calling, social networking to speculative emails. Depending on the kind of business, the lead generators use tactics to try and warm up a prospect.
Finally, sales gets their moment in the sun. A warm lead is a qualified lead, and your sales team now gets to use their skills to keep the prospect on the downward trajectory until they are ready to buy. Since not all qualified leads will follow through on a purchase, no matter how well the business development and lead generation teams did their job, it is up to the sales reps to continue the momentum and cultivate the relationship.
Ultimately, whether it’s business development, lead generation or sales, all of them are vital to your company’s success. And more often than not, they have to work together, even on each other’s tasks to see that success happen.
Read more relevant blog post: Why Startups Need New Product Marketing Strategies to Stand Out in 2019