Lead generation for engineering companies

Lead generation is fundamental to having a services business

“Lead generation” essentially means creating a viable business in a capitalistic system.

Unless you have 100% repeat business (you don’t), you need leads.

This is no small feat.

Don’t underestimate how hard this is.

It’s one of the hardest things you’ll do as an engineering business.  Often harder, and more frustrating, than the technical challenges you face.

You should be clear about what you mean when you say “leads”

I try not to let myself or others call them “leads”.

At least not at first.

It’s too confusing.

This clarity will help you improve your chances of being on the same page when conversations between marketing, sales, and leadership arise.

I generally like to organize this into 3 categories / buckets:

1. SRLs (Sales Ready Leads)
2. MQLs (Marketing Qualified Leads)
3. Contacts

SRLs

Sales-ready leads for engineering companies usually have these three characteristics:

1. Appears to be a reasonable fit for your company.
2. Has a need (large or small).
3. Has expressed interest in talking to someone from your company.

Exceptions where only a subset of these characteristics might be satisfied and still considered an SRL:

If you’re trying to do account-based selling, and someone from that company expresses interest in talking to someone from your company, you’ll likely want to have a conversation even if you don’t know if there’s a need that you can help with.

If someone expresses interest in a conversation and describes a need that seems on point with your expertise, you probably want to have a chat with them even if you can’t tell if their company is a good fit yet.

MQLs

Marketing-qualified leads (MQLs) are people that:

1. you can tell are likely a good fit for your company,
2. but haven’t expressed any need yet.

In other words, they work for the type of company that you do business with, and their role is the type of role you do business with. But they either haven’t told you they need help yet, or maybe they don’t think they need help at this time.

The three main questions for this group of people are:

1. Can you make a solid enough impression on them and stay front-of-mind enough for them to consider you when they do have a need?
2. Can you learn anything from this group of people to help you improve your business in some way, shape, or form?
3. Is there a service that you should consider offering that you’re not that this group of people might be interested in? Are you missing the boat on something?

Contact

Essentially this is the “other” bucket. You have their contact info, but they’re not an SRL or MQL. This is of little value.

Attribution is great in theory, painful in reality

Engineers love to measure things.

I get it. It gives you a target to aim toward. I like that as well.

However, what often gets missed when trying to perform attribution for services-based companies is that end-to-end attribution is essentially impossible these days.

Why?

Because not all the pieces tie together. Partly because they never did, and partly because of changes in the privacy landscape.

A simple example:

1. someone stumbled across one of your posts on LinkedIn because someone they’re connected to is connected to people at your company and LinkedIn’s algorithm decided they might be interested in this post.
2. They read the post quickly, found it interesting, but moved on after a minute.
3. Four months later they listened to someone from your company give a presentation at a conference on a topic of interest to them.
4. Two months later, they ran into a problem, started searching the internet for ways to address their problem, and they came across one of your articles. They read it, liked it, and for the first time, consciously considered that maybe you could help them.
5. After doing a bit more digging both on your website and other sites, they decided to reach out to see if you could help.

How would you attribute the marketing effort here?

What weights would you assign to each piece?

Do you believe you’d even have all this knowledge for a single individual?

You won’t.

Tips:

1. Use attribution directionally, not individually. In groups, attribution information can still be useful to identify patterns, even when there’s noise.

1. Correlation will usually be more appropriate than causation. Accept that data will be incomplete.

3. Let attribution information influence you, but don’t let it dictate your decisions. Human judgement and instincts are becoming more important, not less.

Doing sales well is hard. Don’t minimize it.

I’ve heard many engineers say something like “if I get a good lead, I’ll close it”.

Sometimes that’s more true, and other times less true. From what I’ve seen, it’s important for engineers to recognize that sales is its own discipline. Just because you’re very capable when it comes to solving technical and rational problems, does not mean that you’re good at sales, which involves a lot of empathy, emotion, and less-rational behavior.

A few tips on this front:

1. Respond quickly, but don’t stress about it. There are two main levels of response time to target:
   1. If you can respond while the SRL is still in the flow of looking for help (usually about 30 minutes), you stand a solid chance of getting an immediate reply from them for scheduling a conversation.
   2. You won’t always be able to reply so quickly, and that’s ok. If you reply within about 5 business hours, you’re usually fine.
2. Make sure your email makes it to their inbox.
   1. Try sending plain text email.
   2. Check with IT to make sure your email domain isn’t on any blacklists.
3. Make sure to spend time prepping for your first sales call. Examples of what you’ll want to spend time on before the call:
   1. Check out their company website of course.
   2. Check out their LinkedIn company page. The overview section can often shed some light on their focus because of its limited character count.
   3. Google the company in several ways.
   4. Check out the person’s LinkedIn profile to see where they’ve worked in the past, what they do now, and what their primary skills are.
   5. Try to read between the lines of what they say in their initial outreach so you can try to get a step ahead of them before the initial call.
4. Address the elephants in the room during the call.
5. Make sure you’re asking open-ended questions to get a feel for where their head is at.
6. Don’t try to be a sales person. Try to be you. You need to be authentic. Help, don’t sell.
7. Don’t be afraid to be vulnerable sometimes.

It’s usually more about CLV than total quantity of sales-ready leads

Here’s the deal: CLV (Customer Lifetime Value) is often one of the most important metrics for creating and maintaining a healthy and sustainable business. But it’s not always the higher the better. A CLV can be too high, just like it can be too low. It’s more that you need to figure out the sweet spot for your business.

For customers with too low of a CLV, you may be too inefficient. You spent time during sales. You spent time ramping up to understand their business, their processes, their people, and their culture, only to have them disappear after one project. No good.

For customers with too high of a CLV, this can make you too dependent on them, and too biased toward the way they do things. You need to have some level of understanding of your market at large. Too few customers will limit your exposure.

Sometimes just getting a foot in the door is super valuable

Because CLV is usually more important than initial project size, a foot in the door can be super valuable. If you know:

1. how to do a great job for your customer,
2. how to be customer-focused, and
3. how to be patient,

then that foot in the door may be all you need to start developing a solid long-term customer.

Walking the tightrope of being slammed with work or having engineers on the bench

You likely often have too much or not enough work at any point in time, and it’s easy to waffle back and forth between the two.

If you’re busy, don’t just turn the SRL away or be lazy about engaging them.

Take the time to:

1. See if you can help.
2. Find out more about their overall needs.
3. Start building a relationship.
4. See if there’s some way you can keep them engaged so that you have an easier time engaging in the future.

My preferred lead generation methods

Decide for yourself of course, but here are my favs….

Inbound vs outbound marketing

Inbound and outbound are overarching marketing approaches. They’re high-level strategies.

With outbound, you’re pushing yourself onto potential customers.

With inbound, you’re trying to attract potential customers toward you.

These two approaches encourage and lend themselves to different mindsets and personalities for sales and marketing people.

It’s not that one person can’t do both inbound and outbound, but they’ll likely have a natural strength and affinity toward one or the other.

As a business owner, you’ll want to select a core philosophy. See inbound vs outbound marketing for more. I generally prefer inbound if it’s viable. It aligns with my preference to focus more on being helpful as opposed to pushy.

Within the realm of inbound as a high level marketing strategy, there are two primary marketing methods:

1. Organic search (SEO)
2. Paid search (e.g. Google Ads)

Organic search (SEO) marketing for lead gen

The core of it:

The core of SEO is to try to show up in search engine search results for niches within the engineering realm. As you might imagine, search engine algorithms are wildly complex and constantly evolving.

Pros:

• It encourages you to add clarity to your thinking.
• It can help you help your customers at a deeper level.
• You can potentially get in front of people mainly by letting your uncommon perspective out.
• The decay rate for your effort is often a slow fade as opposed to the impulse-response nature of social media or the on-off nature of paid advertising.
• You can use it as a foot in the door to increase interest in other topics.
• It’s a potential way to broaden your geographic reach.

Cons:

• It’s easy to focus on trying to rank well for the wrong topics.
• There’s a lot of guess work and a lot of noise to sift through to find patterns. Search engine companies (e.g. Google) tend to be pretty cagey about sharing useful information.
• It evolves very quickly.
• There’s a massive amount of information out there on the topic.
• You’ll be hard-pressed to outsource the core content creation aspect (raw content needs to come from SMEs).
• It’s often a long journey, especially when you’re just getting started.
• You may accidentally start attracting people that you don’t want to.

More info:

• Pros and cons of SEO
• SEO for engineering companies

Paid search marketing for lead gen

The core of it:

The core of paid search is paying a company that owns a search engine (likely Google with Google Ads, but could include other search engine companies) to show up for engineering topics of interest, so that people:

1. click on your ad,
2. go to your website,
3. and (hopefully, a small % of the time) reach out for a chat about their engineering service-related needs.

Pros:

• Quick way to test the market. You can show up almost immediately when people search.
• There’s an “on/off” switch.
• They can be throttled (at least at a high level).
• You can target geographically pretty well.
• You can expand your reach beyond your local area.

Cons:

• You’ll have to bend… a lot. You’re at the mercy of the whims of a behemoth advertising platform.
• You have to keep paying the piper, and it’s not cheap.
• You’ll likely end up relinquishing control of your ads over time, sometimes without even knowing it.
• Platform recommendations can lead you astray.
• The platform software can be overwhelming at first. Lots of knobs and dials to play with.

More info:

• Pros and cons of paid search
• Advertising for engineering companies

Secondary methods worth considering for lead generation

Don’t put all your eggs in one basket.

The following methods are worth considering to diversify your lead generation:

1. Referrals
2. Partner channels
3. Selling to existing customers

Referrals for lead gen

The core of it:

There are a couple ways to talk about referral marketing. The kind we’re talking about here is actively encouraging a person that you have a relationship with to connect you with a person that you don’t have a relationship with. That person might work for the same company as the person you know (internal referral), or might work for another company (external referral).

You’re probably already getting passive referrals occasionally. The focus here is a more active outbound approach to encourage leads.

More info: How to encourage referrals when the work you do isn’t super remarkable

Partner channels for lead gen

The core of it:

The core with partner channels generally is that you’re trying to leverage the reach and scale of a large company that provides a piece of the puzzle, but doesn’t provide the entire engineered solution to the customer’s problem. Your goal is to provide the rest of the pieces of the puzzle to solve the customer’s problem.

More info: Partner channel sales and marketing tips

Selling to existing customers for lead gen

The core of it:

The core of this one is about actively selling (vs passively) to an existing customer.

My claim: most engineering services companies should be actively selling to existing customers.

Why?

Because you’ve already spent a lot of time and energy building trust with this company. Assuming the company isn’t small (i.e. they’ve got >100 employees), chances are they’ve got near-term problems that you could help solve.

More info: How to sell to existing customers

As a leader, support is good. Dictating is a recipe for mediocrity.

Dictating that you want things that are outside of your control is a good way to frustrate yourself and demoralize your marketing people.

It’s not useful.

Yet, leaders do it all the time. Especially engineering leaders. Not all of them, for sure. But enough that this is worth mentioning.

People perform at their best when they feel empowered, not when their success hinges on things outside of their control.

This lack of control is in large part why marketing people tend to focus on activities.

They feel pressure, so they gravitate toward things they have more control over.

Can you blame them?

A better approach is to:

1. ask your marketing people what they need from you,
2. ask them to guestimate (yes guestimate) when it makes sense for you to touch base,
3. and then get out of the way.

Here are the main things they likely need on an aperiodic but ongoing basis:

1. Feedback from leadership regarding direction interests and capabilities.
2. Support from SMEs for content development.
3. Financial resources to experiment / test (including software tools and advertising dollars).

Marketing is complex. It’s nuanced. You’re dealing with human behavior in a capitalistic system. It’s hard. Don’t make it harder by trying to fool yourself into thinking that it’s simpler than it is.

You need niches.

For most engineering companies there’s no way around this.

Being an “engineering services company” or “product development company” is just too broad.

Potential customers don’t know how to pick you vs other companies that look essentially the same, and you’ll get lost in the noise.

Check out why you need a niche for more on this.

Building your marketing machine

Engineers can both love, and be confused by, the concept of a “marketing machine”.

The purpose of the term is to help you start to form a mental model that you’re trying to build something that’s more connected than just random pieces of marketing info / content scattered about.

However, a marketing machine is much different than a physical machine. It’s more dynamic, and much more of an amorphous blob than a physical machine. And, it’s non-deterministic.

In my view, a marketing machine for an engineering services company is mainly about focusing energy on a particular set of niches, with the end goal of obtaining sales-ready leads.

Marketing machine process

There’s a lot of nuance in the details. However, at a high level the general flow looks something like this:

1. Find a reasonable niche (or two).
2. Create / update content.
3. Start testing.
4. Assess market feedback.
5. Iterate / pivot / refine.

 Marketing machine tips and insights

1. A marketing machine is non-deterministic mainly because there are so many complex interactions, market dynamics, partially observable information, and human decision making.
2. You must continue providing fuel. Marketing fuel generally takes the form of new / updated content and/or advertising dollars.
3. Some methods have more of a flywheel effect (e.g. organic search) than others (e.g. paid search).
4. It’s usually better to leverage your website as the core of your machine, as opposed to something like a social media platform.
5. You should be building up content assets (e.g. articles, case studies, calculators) that express both your experience and your point of view within your niche(s).
6. Get ready to be uncomfortable. You’re probably really good at designing and developing. This takes impressive technical skills that most of the world doesn’t have. However, if you want to do marketing well, you’re going to need to step outside your comfort zone. What do I mean? I mean less deterministic, human behavior, empathy, emotions, storytelling, etc…..

Case studies