Outsourced Lead Generation?

I have been on both sides of the outsourcing fence, having built lead generation teams internally and outsourced the job to outside service vendors; both with mixed results based on internal and external factors unique in each company and with each vendor.  Before conducting a more complete evaluation of outsourcing options, I would first consider four high level factors that could answer the question, “Should we even be thinking about outsourcing?”.

1) Core expertise – is your company excellent at generating leads for your offering? Some companies are simply not good at lead generation. Either the company doesn’t have the institutional knowledge or experience, or lacks the management oversight and tools to manage the program effectively. There are many firms with amazing experience and core competency in lead generation. I would suggest that if your company is not ‘excellent’ in this area, be open to an outsourcing option.

2) Cost – there are many case studies proving that task specialization (usually by outsourcing) provides cost savings (efficiencies) in the long run. However, there are usually heavy investments of time and money before the program can be turned over. In addition, effective outsourcing requires ongoing maintenance and management, costs that should not be ignored. If your company is focused on short term P&L results, outsourcing may be a tough sale. If the company is more focused on long term cost savings, outsourcing can be compelling with the understanding that cost savings take time to achieve.

3) Scale – this is a huge decision driver for me. A well executed outsourcing arrangement will provide the company with greater speed and much greater scale than setting up or expanding a program internally. If the company is doing lead generation internally today and the results are adequate, I would lean toward keeping the function internal (unless of course the cost savings are demonstrably compelling and the upfront investment can be absorbed).  If the company is looking to set up a new program, or expand an existing one, outsourcing will likely achieve greater scale, faster.

4) Flexibility – one of the challenges for running a program internally is the lack of flexibility in terms of the outlay and results. What happens when sales has too many leads? Or sales turnover has reduced capacity to follow up? What happens in dry months when the staff can’t generate enough leads to fill the pipe? Internal headcounts are not only expensive, but time consuming.  Most companies find it difficult to simply add or eliminate head counts to accommodate short term issues.  A good outsourcing arrangement should provide for at least some flexibility in the process allowing situational changes to be addressed rather seamlessly. In the absence of this flexibility, the outsourcing option looses some of the appeal.

Happy Selling!