Data ROI Study Cost of Not Validating Data...First we’ll examine how the quality of data can impact lead generation investment. Our study shows that conducting a lead generation

Cost of Not Validating DataData ROI Study

Data ROI Study/Cost of Not Validating Data

2

To boost lead generation ROI, look to data

When marketing and sales executives consider campaigns for inside sales, they often contemplate whether to outsource or to

handle the project in-house. They give thought to who will be doing the calling, what kind of expertise that person has, what

technology is needed to facilitate the calls and how to measure success.

After careful planning, they implement the sales campaign, and the campaign has limited success.

This is because managers often overlook one of the most important contributors to the success of lead generation campaigns: quality of the data or list.

The reasons for not investing in validated data are many.

The manager may feel the need to start calling to drive quick

results. Perhaps the manager acquired a list through a list

broker or through other sources, only to find that a large

percentage of the contact data is wrong or outdated.

Commonly, managers skip the data investment to save

money. They opt instead to put budget dollars into the

calling program, assuming this is the best way to generate

campaign ROI.


3

LeadJen recently conducted a study of the role data cleansing

plays in the success of lead generation and prospecting

campaigns. The results are dramatic. Inside sales reps

working with validated data achieve nearly four times more

qualified appointments. In addition, inside sales reps who

are not provided validated data waste about $20,000 in

productive sales time annually.

Study shows data research impacts the “R” and the “I” in ROI

Our study included 12 lead generation campaigns,

representing 121,905 touches (a connection made by phone

or email) across nearly 27,000 leads/contacts at nearly

15,000 companies. All campaigns were active within 90

days of the study.

We found that when it comes to return on investment (ROI) of lead generation campaigns, investing in clean and accurate data positively influences both the Return and the Investment of ROI.

Cost of wasted time

Response rate

Appointments set

$20,475 per ISR annually

2% lower

1/4

Cost of Not Validating Data

...................................................................................................

...................................................................................................

Bad first call attempts

Response rate per lead targeted

Response rate by lead 4.36% 2.41%

MarketResearch

No MarketResearch

Contacts

Contacts after attrition

Response rate

Appointments set

1. 6,769 = (7,500 x 95% accuracy x 5% attrition)

2. 3,675 (7,500 - 30% bad first attempt - 30% not a fit)

7,500

6,7691

4 percent

271

7,500

3,6752

2 percent

74

MarketResearch

No MarketResearch

.......................................................................................................

.......................................................................................................

.......................................................................................................

Cost of Market Research

Data from LeadJen Data ROI Study, 2011. © LeadJen, Inc.





LeadJen, Inc. Data ROI Study/Cost of Not Validating Data


$37.50/Hour

$5/Contact =Cost to Replace Invalid Contacts

$11,250

30%

FirstAttemptsWasted

7,500Contacts

150 Hours Wasted

Contact is not a fit






$37.50/Hour

$17,500/Year

6,300 Bad Attempts

430%

Contactnot a fit

1,575Contactsnot a fit

2,250Wasted

Attempts

2,250Wasted

Attempts

5,250Good

Contacts

420 Hours Wasted

Attempts per Contact

2,250Invalid Contacts

5,250Good Contacts

$1/Contact = Cost to Validate Remaining Contacts

Total Cost of Market Research

Cost Savings

Cost of Wasted Sales Rep Time Without Research

$5,250

+


4

Maximizing the Investment

First we’ll examine how the quality of data can impact lead

generation investment.

Our study shows that conducting a lead generation program

without first investing in data results in 27.3 percent of a sales

representative’s time being wasted chasing bad data. That’s

546 hours a year per full-time inside sales rep.

1. Bad first call attempts. This is the outcome when the company is out of business, the contact no longer is employed, or the contact information is wrong and the rep cannot find replacement information online within 10 minutes. Our study shows campaigns conducted without market research result in three out of 10 first attempts being wasted, at a cost of $5,625 per rep each year. Based on a full-time inside sales rep (2,000 staff hours a year) and 15 average attempts per hour, a sales rep could achieve 30,000 attempts a year to 7,500 contacts.

The waste happens in two ways:

Considering that an inside sales rep costs a company $75,000

a year on average, including salary, benefits and overhead,

that’s a loss of more than $20,000 in productive sales time

yearly for every inside sales rep.

Cost of wasted time

Response rate

Appointments set


2% lower

1/4


...................................................................................................

...................................................................................................




MarketResearch

No MarketResearch

Contacts


Response rate

Appointments set



7,500

6,7691

4 percent

271

7,500

3,6752

2 percent

74

MarketResearch

No MarketResearch

.......................................................................................................

.......................................................................................................

.......................................................................................................









$37.50/Hour


$11,250

30%

FirstAttemptsWasted

7,500Contacts

150 Hours Wasted







$37.50/Hour

$17,500/Year

6,300 Bad Attempts

430%

Contactnot a fit


2,250Wasted

Attempts

2,250Wasted

Attempts

5,250Good

Contacts

420 Hours Wasted



5,250Good Contacts



Cost Savings


$5,250

+

Cost of wasted time

Response rate

Appointments set


2% lower

1/4


...................................................................................................

...................................................................................................




MarketResearch

No MarketResearch

Contacts


Response rate

Appointments set



7,500

6,7691

4 percent

271

7,500

3,6752

2 percent

74

MarketResearch

No MarketResearch

.......................................................................................................

.......................................................................................................

.......................................................................................................









$37.50/Hour


$11,250

30%

FirstAttemptsWasted

7,500Contacts

150 Hours Wasted







$37.50/Hour

$17,500/Year

6,300 Bad Attempts

430%

Contactnot a fit


2,250Wasted

Attempts

2,250Wasted

Attempts

5,250Good

Contacts

420 Hours Wasted



5,250Good Contacts



Cost Savings


$5,250

+

Cost of wasted time

Response rate

Appointments set


2% lower

1/4


...................................................................................................

...................................................................................................




MarketResearch

No MarketResearch

Contacts


Response rate

Appointments set



7,500

6,7691

4 percent

271

7,500

3,6752

2 percent

74

MarketResearch

No MarketResearch

.......................................................................................................

.......................................................................................................

.......................................................................................................









$37.50/Hour


$11,250

30%

FirstAttemptsWasted

7,500Contacts

150 Hours Wasted







$37.50/Hour

$17,500/Year

6,300 Bad Attempts

430%

Contactnot a fit


2,250Wasted

Attempts

2,250Wasted

Attempts

5,250Good

Contacts

420 Hours Wasted



5,250Good Contacts



Cost Savings


$5,250

+

2. Contact is not a fit. This is the outcome when the sales rep reaches the contact, but the contact is not a decision maker, no longer is in the necessary role, or something happened at the company recently so the company isn’t a relevant target. The average “not a fit” rate is 30 percent, but the impact on the organization is even greater. This is because sales reps must perform several attempts before finally reaching the contact, only to find that the data is wrong. On average, it takes four attempts to reach a contact, resulting in a cost of $15,750 per sales rep annually.


5

Good data turbo-charges results

Now let’s look at how the quality of data impacts the “R” in

the campaign’s ROI.

Our study shows that campaigns invested in market research

average a 2 percent greater response rate per lead targeted.

In blended campaigns--those using both market researched

lists and non-researched lists-- we found that 65 percent

of appointments came from the market research lists.

Considering that the non-researched lists were generated

from trade shows and other inbound sources, which naturally

are warmer lists, those results are even more stark.

Since campaigns with market research result in nearly four times more appointments, it follows that campaigns investing in market research also will result in four times the number of sales.

Assuming that researched lists can expect 95 percent or

greater accuracy, the outcome is dramatic:

Those percentage gains translate to nearly four times more appointments.

Cost of wasted time

Response rate

Appointments set


2% lower

1/4


...................................................................................................

...................................................................................................




MarketResearch

No MarketResearch

Contacts


Response rate

Appointments set



7,500

6,7691

4 percent

271

7,500

3,6752

2 percent

74

MarketResearch

No MarketResearch

.......................................................................................................

.......................................................................................................

.......................................................................................................









$37.50/Hour


$11,250

30%

FirstAttemptsWasted

7,500Contacts

150 Hours Wasted







$37.50/Hour

$17,500/Year

6,300 Bad Attempts

430%

Contactnot a fit


2,250Wasted

Attempts

2,250Wasted

Attempts

5,250Good

Contacts

420 Hours Wasted



5,250Good Contacts



Cost Savings


$5,250

+

Cost of wasted time

Response rate

Appointments set


2% lower

1/4


...................................................................................................

...................................................................................................




MarketResearch

No MarketResearch

Contacts


Response rate

Appointments set



7,500

6,7691

4 percent

271

7,500

3,6752

2 percent

74

MarketResearch

No MarketResearch

.......................................................................................................

.......................................................................................................

.......................................................................................................









$37.50/Hour


$11,250

30%

FirstAttemptsWasted

7,500Contacts

150 Hours Wasted







$37.50/Hour

$17,500/Year

6,300 Bad Attempts

430%

Contactnot a fit


2,250Wasted

Attempts

2,250Wasted

Attempts

5,250Good

Contacts

420 Hours Wasted



5,250Good Contacts



Cost Savings


$5,250

+


6

Market research pays for itself

Summary

While market research isn’t free, we’ve found that the cost

essentially is being paid for through the enhanced productivity

of sales reps.

However, the real difference is seen in the results. Campaigns

that deliver four times the results for the same cost are not

uncommon.

Conducting a lead generation campaign is exciting. Anticipating great results can cause managers to rush a program without first investing in market research. This results in significant waste for the organization.

The study shows that organizations not investing in market

research as part of a lead generation campaign wastes close

to 30 percent of sales reps’ time calling invalid contacts.

More importantly, investing in good data delivers significantly

better results. The study shows campaigns that have

invested in market research produce nearly four times the

number of appointments compared to those without market

research. Since appointments lead to sales, it’s logical to

say that campaigns that start with market research produce

significantly higher sales.

Validated data delivers:• More leads, as bad leads are replaced.

• More valid touches.

• Nearly four times the results.

• Almost 100 percent efficiency.

7

LeadJen is a B2B lead generation company that uses unparalleled data and insight to drive prospect interactions that convert to sales. The company’s committed team and proven, repeatable process benefit clients targeting industries including, healthcare, manufacturing, retail, financial services, life sciences and high tech. LeadJen is based in Indianapolis.

For more information, visit www.leadjen.com.

Documents

Data ROI Study Cost of Not Validating Data...First we’ll examine how the quality of data can impact lead generation investment. Our study shows that conducting a lead generation