Home > Case study: New technology helping manufacturers improve distributor communication and boost sales

Case study: New technology helping manufacturers improve distributor communication and boost sales

Editorial
article image Manufacturers need to be able to clearly visualise and understand what is happening to the leads they send to distributors

Manufacturers selling through a channel sales network are mostly not really aware of how their sales leads pan out once they are handed over to the distributor.

A typical scenario would involve a potential customer calling the factory or sending a quote request through the manufacturer’s website. The marketing department sends an email to the local distributor with the lead details. Visibility for the manufacturer usually ends at this point, with no information of what happened next. For instance, was the lead contacted by the distributor? Or how fast did the distributor sales person reach out to that potential customer? 

Manufacturers who don't have the answers to these questions, must seek them if they want to optimise their sales channel and maximise revenue. Price Pump, a manufacturer of centrifugal and air operated diaphragm (AOD) pumps, is all-too familiar with this story. 

According to Jestin Plowright, Sales and Marketing Manager for Price Pump Company, a leading manufacturer of industrial pumps, though they are able to generate high value leads for their distributors to sell more products, it’s a challenge for the company to know whether or not the sales reps are following up on the leads and what their sales forecasts look like across their distribution channel. The only feedback they get from their distributors is the occasional email, and only on request.

Plowright's concern is warranted. A recent study from the Harvard Business Review shows that 47% of leads are contacted more than 24 hours after the initial customer inquiry, greatly diminishing the probability of making a sale. Meanwhile, many customers are never contacted at all. Gartner Research reports that 43% of sales go to the company that follows up first on the lead. These studies highlight the danger of not knowing what is happening with the leads. However, the absence of any visibility to their outside sales channel makes it nearly impossible for manufacturers to identify and address those red flags.

Additionally, manufacturers have been unable to connect leads to specific marketing or advertising sources to determine the ROI on their marketing dollars spent. Forecasting sales based on the leads in the channel pipeline can also be a challenge, as is organising leads in a central location that is easy for outside sales reps to use. These are all issues that directly impact the manufacturers’ sales and revenue.

Lack of communication affects not only manufacturers but also distributors. Ron Somerville, an equipment distributor covering the Southeast US for Master Pumps says communication between manufacturers and distributors has always been a challenge, adding that distributors don’t have an effective tool to provide manufacturers with consistent information about the leads they send. 

Customer relationship management (CRM) systems are well-known for managing leads and customer data within an internal sales organisation. However, for companies that sell through outside distribution channels, they don’t provide the functionality needed to manage leads and facilitate communication across this complex sales channel.

According to Somerville, several of the manufacturers they represent have asked them to use their CRM programs. This doesn’t work because distributors don’t want to learn how to use 20 different systems and keep track of 20 different login details for something they rarely use. 

Manufacturers need to be able to clearly visualise and understand what is happening to the leads they send to distributors. Meanwhile, distributors need an easy way to communicate with manufacturers that integrates seamlessly with their normal business process. Fortunately, new technology can help bridge this gap by easing the flow of communication and information for both sides.

It’s clear that for a lead management system to work for manufacturers and their outside distribution network, it has to be simple, easy to use, and integrate with their existing business processes. 

LeadMethod has created a powerful, easy-to-use, web-based lead management software that allows manufacturers to automate their lead capture and distribution process while offering their distributors a tool to easily organise their leads and provide feedback on their sales opportunities. The software also provides manufacturers with powerful analytics to understand what is happening with their leads, as well as their sales opportunities, sales forecasts and distributor performance.

Jestin Plowright of Price Pump Company states that the LeadMethod team has built an amazing platform for them to better understand their sales opportunities, and improve the communication and feedback with distributors.

According to Gartner Research, automating the lead management process enables companies to increase revenue by 10% or more in only six months. Justin Johnson, CEO of LeadMethod says that gaining control of those languishing leads represents a huge opportunity for manufacturers in terms of revenue growth.

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