5 places your inbound funnel is bringing in bad customers
Every smart sales rep knows you can’t go out and sell to just anyone. You have an ideal customer. And you’re going to have much higher levels of success if you target that exact person. So why don’t you do the same with your inbound sales?
Too many startups and SMBs see a customer at their door with a fistful of cash and suddenly forget all the work they’ve put into defining their ideal customer.
But just because a lead fills out a contact form or signs up for a free trial, doesn’t mean they’re a good customer. And in many cases, they’re the exact type of customer you want to turn away.
The fastest and easiest way to figure out if a prospect is good or bad for your business? Qualify them effectively! Click here to download a (free) list of my 42 best qualifying questions!
Why you need to stop falling for the “They came to us” trap
An unqualified inbound lead is just as bad as an unqualified outbound one. And there are lots of examples of inbound interests that might come to you that either will just waste your time, or convert into bad customers.
They might be:
- Too small: They’re students or small businesses looking for a free service who will never convert.
- Bad use cases: They don’t have the right use case to get value from your service.
- Too large: They’ve got deep pockets but need features you’re not prepared to give them.
- Business partnerships (when you’re not ready): They’re channel partners who are promising the world, but you might not have the resources or time to work with them.
- Potential investors: They just want to know more about you and are going to suck up a lot of your time and energy.
- Competitors: They want to pick apart your funnel and see what they can steal for their own company. (And yes, you absolutely should do this yourself.)
- International trials: They could theoretically be good customers, but you’re not set up for their currency or language, or can’t service them for legal or technical reasons.
You would never actively go out and try to sell to any of these people. So why even entertain them when they come to you?
I get that it’s hard to leave money on the table. But let’s look at the realities of selling to one of these bad customers for a second.
Let’s say you’re a company that deals exclusively with SMBs. Then, all of a sudden, an enterprise-level deal lands right in your lap. It might seem like a sign, or an opportunity. But really it’s a ticking bomb:
- Do you have enterprise experience and expertise?
- Is your product designed for this level of user?
- Do you have the kind of support and service they expect?
“Well, no. But they came to us…”
That’s not a good enough reason. A bad customer is a bad customer. That doesn’t change just because it’s easy to close them. You need to tell them no and then change your inbound funnel so more people like them won’t find you in the first place.
How to say no to a customer that wants to give you money
If you’re not setup for serving a customer, you need to tell them no before they get invested or move further down your funnel. Simply tell them:
“We appreciate your interest, but our product isn’t built for your use case. But here are some alternatives that might be a better fit for you.”
They might push back, but you need to be firm. As I’ve said before taking money from the wrong clients can be a death sentence for your company. So stop them before they get any further.
5 ways to disqualify non-ideal customers in your inbound funnel
Once you’ve dealt with these non-ideal inbound leads, you need to analyze how they found you and why they thought you might be right for them.
Just like you segment and qualify the leads you reach out to, you can design your inbound funnel to sort out as many non-ideal customers for you as possible.
Start by looking at and optimizing your:
- Marketing: Are you going wide or deep? It’s easy to get caught up in vanity metrics like traffic and sign-ups, but if you’re marketing to the wrong people you’re just filling your funnel with noise.
- Ad copy: Your advertising and messaging should speak to your idea customer, but it should also actively disqualify your non-ideal customer as well. For example, if you want to disqualify customers looking for free or cheap products, instead of “Free trial” you could say ”starting at $65 a month.”
- Website design: Your design can tell a customer if they’re in the right place or not. If a government agency came to Close, they might be put off by our language and Arrested Development references. That’s on purpose. We don’t want them as customers.
- Sign-up Form: What you ask a customer in your forms can tell them they’re not a good fit. For example, if you want to only work with established companies, add a field that asks “are you an organization of 25 or more people?” Or, require them to choose their role from a dropdown and only give them options of the kind of customer you want.
- Pricing and trials: Do you offer free trials or not? Do you require a credit card up front? Do you even show pricing before someone talks to a rep? Each one of these will attract (and repel) a certain user.
If you don’t know who your ideal customer is yet, start with the one you can learn from the quickest
All this advice assumes you know who your ideal customer is. But if you don’t and are still doing customer development, remember this: Time can either be your greatest ally or your worst enemy.
Ask yourself what the time investment is to test whether this customer is the right one. Can you survive for that long even if the sale doesn’t happen? And does the potential reward make it worth the risk?
For example, an enterprise client might offer a potentially huge deal, but often take 18 months to close (even if you use some of our tips to shorten the sales cycle). Whereas an SMB client might take a month or two.
Designing an inbound funnel for a customer that takes a few months to go from marketing to trial to converting to a customer is a lot less risky than designing one for a customer that takes 18 months.
Whenever possible, go fast. Look for the verticals that give you the most insights in the shortest period of time and learn as you go. The path to success is paved with clear outcomes, good or bad. Most startups fail not because of their failures, but because they get stuck in the middle—the place I call “the maybe-zone”. That’s where you’re operating on hopes that things will work out some day in the future.
Don’t be fooled into thinking a customer that came to you is an easy win
You need to be just as diligent about who you let into your funnel as who you reach out to. Because the more time you spend dealing with the wrong customers, the less time you have to actually sell to the right one.
Taking on a customer is always your choice. So if someone came to you, ask why? Are they your ideal customer? If not, tell them no. And then figure out how they got in and plug the leak.
Are you sick of dealing with bad inbound leads? Tell us your stories and strategies in the comments below.
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