SME FIRST CIRCLE

HOW do you build a lead generation machine that consistently feeds product market fit leads into your sales funnel? There is no onesize-fits-all solution, but experience will show similarities in approach.

Picture this: You just started your business and started acquiring a few customers and waiting for market validation. You see momentum in their use of your product. You ask why at the tiniest movement you see. At some point, you may have found the holy grail of customer cohorts: product market fit.

You begin to think about scaling and start dreaming of the next turning point. You start to think about 100M in ARR or when your micro brand is acquiring half of its customers at no cost. You also start to wonder how long it takes to get there.

Ideas are running wild. Your eagerness to try different things is shooting through the roof. It may be tempting to accelerate, but you need to stop yourself first and analyze the information in front of you.

Let’s start with defining what product market fit is. This is part of the startup vernacular and a very ingenious concept. The first thing you need to understand is “being product market fit” has a wide range of attributes that evolve throughout the life cycle of the company. Leads considered product market fit for First Circle in 2018 may not be so in 2020. Finding product market fit is an iterative process that requires constant rediscovery.

When I started with First Circle, the target market was small and medium enterprises with bridge financing requirements. These are the customers my team targeted. We encountered a number of downstream challenges that led to experiments aimed at improving product offerings and maximizing distribution channels. On paper, the volume of newly onboarded customers and origination amounts looked good, but there were underlying problems suggesting we were not targeting product market fit leads. We had a number of single-use customers, customers incurring late payments, and we have been receiving a number of poor CX reports.

This allowed us to look at lead generation and selling in a more focused manner. We dug deeper into subsegments of the market with telltale signs of product market fit with the lowest aversion to growth. In the last six months we launched a team that conducted outbound prospecting and improved how we do inbound lead qualification. Now, we are also applying lessons to improve content management and our online application flow. All these activities are geared toward acquiring and converting the best quality leads.

Let’s now segue to the ideal customer profile and buyer personas, which are key to product market fit lead generation. Successfully identifying this profile and personas are essential to focused lead generation. A good sales model should be using the ideal customer profile to determine the target company type and the buyer persona for the target person.

Let’s say you’re in the transport and logistics industry, and your ideal customer profile is a business that has big clients and experiences a spike in orders seasonally. One of your buyer personas is most likely the young, independent entrepreneur who likes taking on all orders and meeting customers’ demands right away. After knowing these, you then shift your focus to find the best place to find these companies and people.

First and foremost, you should know which companies you wish to target and the persona you should be selling to. Not knowing these is like shooting for the moon and wishing you would land on the right spot. Having clarity about your target profile and persona makes you deliberate on your call to action. These guide your lead generation activities. It drives the messaging of communications, advertisements, media content and landing pages. As a strategy, this allows us to choose our customers and not vice versa.

How do you build the ideal customer profile? First, identify these basic characteristics: company size, industry, geography, legality and product limitations. These are only five; more may be added or subtracted. But having five from the get-go is enough. You can build on this as you discover more characteristics along the way. You may then use the predefined characteristics you have set to qualify or disqualify leads.

One of the challenges is the pretense of how easy this seems until complexities start presenting themselves. Each time a new characteristic or job title emerges, the temptation to alter the profile or add a persona emerges. Do not fall into the trap of looking for differences; look for similarities instead.

In summary, use these simple steps for a focused product market fit lead generation:

– Conduct an analysis of your company’s existing customer base. Create a list of the ideal customers — they are usually the ones with standard sales cycles and are generally happy with your products.

– Research and get to know your ideal customer profile. Collate firmographic data and interview to find out their JTBD — jobs to be done — and their product usage behavior.

– Find your buyer personas. Find out who makes the decision and how to get one. What is the level of awareness of the decision-maker and how do they feed on information?

– Revisit your current lead generation initiatives. Align resources, channels, collaterals and communications to target the ideal customer profile and buyer persona.

My main tools are First Circle’s customers, my customer-facing team members and my CRM. They allow me to use information to look for trends in how they access and consume our products. This information, in turn, becomes my guide in generating good-quality product market fit leads.