Before you can turn local community members into repeat, loyal customers, you need to entice them to give your small business a try. This process is known as lead generation, and it’s essential to growing your customer base and boosting your bottom line.
But, what is lead generation exactly, and how can you leverage it to benefit your business?
Put simply, lead generation is all about drumming up interest in your products and services and then converting that interest into contracts, sales, and revenue. From individually-owned startups to multinational conglomerates, companies of all sizes rely on lead generation to attract customers, bolster future growth, and maintain profitability.
Let's explore the essentials of lead generation so that you can benefit, too.
What is a lead?
Anyone with the potential to patronize your business can be thought of as a lead. In essence, a lead is any person who’s:
- Interested in your company’s products or services
- Curious to learn more about your brand
- Likely to browse your offerings, chat about the value you offer, and, ultimately, make a purchase
- Been vetted by your staff to be a probable customer
Leads are essential to continued success as they help you attract more customers and allow your business to grow. There are various types of leads, however, and each requires a different kind of lead nurturing strategy to drive a conversion.
Types of leads
The four main types of leads include:
- Marketing Qualified Leads (MQLs) – An MQL is a lead your marketing team has deemed likely to become a customer. They may have visited certain web pages, downloaded offers, or clicked links that confirm their interest in your company.
- Sales Qualified Leads (SQLs) – SQLs have been thoroughly vetted by both your sales and marketing teams to be likely customers. They’re more than just interested in your products and show a clear desire to make a purchase in the near future.
- Product Qualified Leads (PQLs) – PQLs are likely conversions as they’ve already tried your products—whether through a free trial or other experience—and understand the value they can provide.
- Service Qualified Leads (SQLs) – SQLs are likely to pull the trigger on a purchase as they’ve already told your sales reps or other staff that they want to discuss your offerings in greater detail.
The types of leads you generate for your business depend on the strategies you use to attract more community members. For example, Casper, a nationally-recognized mattress supplier, generated a variety of lead types by leveraging a mix of video messages, local targeting, and large scale Nextdoor newsfeed ads to reach a broader audience.
Lead generation strategies
Attracting potential customers to your small business takes planning and tact. Generate more leads for your company with these lead generation strategies:
Online lead generation
For most local businesses, the internet is the quickest and most common means of generating leads. You can use it to tell more community members about your brand with:
- Email marketing – Send out a newsletter, offer list, or other email to all your neighbors explaining what deals you have in-store and why they should choose your company over your competitors.
- Social media – Be sure to create pages on all the leading social media platforms—especially Nextdoor Business. A Nextdoor Business Page lets you interact with real members of your local community, collect recommendations, and spread the word about your brand.
- Search Engine Optimization (SEO) – SEO is the process of climbing the ranks on Search Engine Results Pages (SERPs) to get your business near the top spot. Use relevant industry keywords in your website’s body text, link to similar pages, and post high-quality images to boost your SEO efforts. Incorporating a content marketing strategy is also important here, to drive more top-of-funnel traffic and attract new website visitors.
Offline lead generation
Even though the vast majority of Americans are online, the internet isn’t the only way to connect with members of your local community. Reach individuals who don’t spend much time online or don’t rely on internet advertising through:
- Networking events
- Physical mail
- Local advertisements—such as those in newspapers or on signs
Plumber John Consigli, for instance, combined traditional billboard advertising with his Nextdoor Business Page to significantly boost his company to the point where he “couldn’t keep up with the amount of work he was receiving.”
The lead generation process
Whatever tactics you decide on to attract more clientele, every potential customer who learns about your brand goes through three steps in the lead generation process:
- Awareness – This is when individuals start to learn about your local business, the products or services you offer, and your reputation.
- Interest – This is when aware prospects discover more about your company—usually via creative content, various advertising channels, or discussions with your staff—and realize the value of your products or services.
- Conversion – This is when a lead becomes a client by taking a predetermined desired action. This can be making a purchase, clicking a link included in a Call-to-Action (CTA) on your latest Nextdoor post, filling out a form, or another, similar conversion metric.
Once your leads follow these three steps, they’re no longer potential customers—instead, they become an established part of your base.
Measuring lead generation success
When you start putting effort into attracting more customers, you’ll likely want to know that your hard work is paying off. Use these techniques to track the success of your lead generation campaigns:
Key metrics to monitor
A few Key Performance Indicators (KPIs) to keep track of to gauge your lead generation’s efficacy include:
- Lead conversion rate – This is the ratio of your qualified leads that end up purchasing, clicking your desired link, or otherwise converting with your company. To calculate it, take your conversions and divide them by the total amount of leads you generate.
- Lead quality – Lead quality measures how likely a lead is to convert into a customer. There’s no cut-and-dry formula to measure it, but many companies score leads on a scale of one to ten to assess their potential to end in a conversion.
- Cost per lead – This is a measure of how much each lead costs to generate. To add it up, take the amount you spent pursuing new customers and divide it by the total number of leads you generated.
Analytics tools
Calculating KPIs and these other metrics can be time-consuming and tedious, but the right analytical tools can do much of the work for you. Thomasville furnishers, for instance, leveraged Nextdoor to better understand their lead acquisition costs and spend their advertising budget more effectively.
By connecting with local homeowners on Nextdoor, Thomasville reduced the amount needed to attract customers into their stores to just $0.14 to $0.17 per visit. With Nextdoor’s powerful analytics at your fingertips, you too can refine your lead generation campaigns to minimize costs and improve your B2B growth strategy.
Continuous optimization
The market you operate in—and the neighbors who make up your customer base—are constantly evolving. In turn, you must consistently update your lead generation strategies to match the demands of your industry and area.
Conduct research into ongoing market trends, learn about your target audience, and use this information to refine your techniques as your small business grows.
Common challenges and solutions in lead generation
Lead generation is essential for continued growth—but it isn’t without its obstacles. A few of the most common lead generation challenges facing small businesses include:
Overcoming traffic shortfalls
Low website traffic is a reality for far too many small businesses. Without a consistent stream of visitors to your page, it’s difficult to tell if your neighbors even know that you’re in operation. To drive more traffic to your website:
- Optimize your SEO techniques
- Leverage paid search engine advertising
- Promote your small business on Nextdoor and backlink to your webpage
Website traffic is a major marker of success in the modern, digital era. Drive neighbors to your page and qualified, high-quality leads will follow.
Reducing friction in lead capture
Generally speaking, your neighbors want to find the right products and services to solve their issues. But if your onboarding process is confusing or difficult, they may skip over your company in favor of your competitors.
To reduce friction in lead capture, make sure to:
- Simplify signup forms – Make personal information—such as phone numbers, addresses, and other identifiers—optional for your new clients. Even simply collecting email addresses is enough to power your digital marketing efforts and keep neighbors in the loop about your small business.
- Enhance your user experience – Know what your neighbors want in a product, service, and company. Understand the differences between your target market vs. target audience, and use that to improve interactions with your clientele.
Aligning sales and marketing
When your marketing department qualifies a lead, they generally hand the prospect off to your sales team to close the deal and score a conversion. Ease the transition between these two teams with:
- Established playbooks to handle different kinds of leads
- Individual customer profiles to reference and work from
- Open lines of communication
When your marketing and sales team work hand-in-hand, fewer leads fall off before becoming conversions.
How Nextdoor can elevate your lead generation
Nextdoor users are real people living in the same area where you do business. Because they’re your neighbors, reaching out to them is essential to grow your small business and expand your customer base.
By promoting your business on Nextdoor, you can generate high-quality, local leads from individuals already interested in your products and services. Interacting with your neighbors on Nextdoor also helps you maintain community relationships and build your brand’s reputation beyond your immediate vicinity.
Register your Nextdoor Business Page to start generating the leads you need to expand your small business into a locally recognized brand.
Sources:
- HubSpot. Marketing Qualified Lead: Everything You Need to Know About MQLs. https://blog.hubspot.com/marketing/definition-marketing-qualified-lead-mql-under-100-sr
- Salesforce. What is a sales-qualified lead (SQL). https://www.salesforce.com/ap/blog/what-is-a-sales-qualified-lead/
- TechTarget. What is product-qualified lead (PQL)?. https://www.techtarget.com/searchcustomerexperience/definition/Product-Qualified-Lead-PQL
- HubSpot. What Is a Service Qualified Lead?. https://blog.hubspot.com/service/what-is-a-service-qualified-lead
- PEW Research Center. Demographics of Internet and Home Broadband Usage in the United States .https://www.pewresearch.org/internet/fact-sheet/internet-broadband/
