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Unlike many marketing channels, referrals have a steady influence throughout the business-to-business (B2B) sales pipeline, especially when it comes to closing the deal, according to October 2014 research by Implisit. Among nearly 500 US-based Implisit clients, who all used Salesforce.com as their CRM system, 3.63% of leads generated from customer and employee referrals resulted in a sale.
This was more than 2 percentage points above the lead-to-deal conversion rate for second-place websites (1.55%) and No. 3 Facebook, Twitter and other social networks (1.47%). No other channel passed 1%.
Breaking down the sales funnel further, Implisit found that on average, it took 84 days to convert 13% of leads to opportunities. Nearly 25% of leads generated from customer and employee referrals resulted in an opportunity—that is, a prospect who is engaged in an active sales process. This was the second-highest lead-to-opportunity conversion rate, with websites leading here at 31.3%. All other channels studied didn’t break 20%. Third-place webinars saw lead-to-opportunity conversion of 17.8%, with Facebook, Twitter and social networks close behind (17.2%). Though the order was relatively similar to that of lead-to-deal conversion, marketing and advertising (15.3%) ranked higher than paid search (14.3%) and sales generated (13.9%) by this metric.
Post-opportunity, the process moved much faster, with Implisit clients taking 18 days on average to convert opportunities to deals, but the rate was just 6%. Customer and employee referrals ruled when it came to this part of the pipeline, as 14.7% of referral leads that converted to opportunities resulted in a sale. This was more than 6 percentage points above the opportunity-to-deal conversion rate for Facebook, Twitter and other social networks (8.5%), the second-highest.
Email campaigns stood out here, as well. Despite low lead-to-deal (0.07%) and lead-to-opportunity (0.9%) conversion rates, they ranked third in opportunity-to-deal rates, at 7.8%. Meanwhile, webinars and websites—decent at converting leads to opportunities—were weak when it came to finalizing a sale.
B2Bs should focus on customer and employee referrals throughout the sales process. However, they’ll need to mix up their focus on other channels depending on whether they’re looking to convert a lead to an opportunity or an opportunity to a deal.
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