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What Small Businesses Need to Know About Lead Generation

What Small Businesses Need to Know About Lead Generation
Credit: Shutterstock/Creative Labs

A business that offers services to consumers or other businesses must find their client base somewhere. The best way to do this is through lead generation.

"Lead generation is the process of creating and capturing interest in a product or service for the purpose of increasing your client base and revenue," said Ari S. Goldberg, founder of investment firm RNMKR. "Lead generation often uses digital and social channels, and has been innovating rapidly the last few years with the rise of new online and social techniques."

Without active lead generation efforts, it will be very difficult to grow and scale your current business.

"You cannot serve clients until you get them, and you cannot get them without generating the initial lead to convert them from an unknown person, to someone interested in your product or service, to an actual paying client," said Goldberg.

Rune Hauge, head of growth for auto dealership e-commerce solutions provider Drive Motors, said that in today's world, people are so bombarded by advertising that they tune it out.

"Traditional advertising is like shouting through a megaphone at a passing crowd, which is interruptive, expensive and ineffective," Hauge said. "Lead generation is more like meeting someone for coffee or going to a book club. It's a way to start meaningful conversations with people. This is how businesses can build strong relationships and lasting loyalty, which will power their long-term success." [Looking for help with customer relationship management? Check out our recommendations for the best CRM software.]

Strong customer relationships are at the heart of a successful small business, but new customer acquisition can often be a challenge.

"Small businesses [can] … earn new customers by engaging leads through relevant content offerings, which establishes trust and the opportunity to form a relationship," said Hauge. "Customers [who] have chosen to engage with your business and have initiated contact are likely your most loyal ones."

Goldberg put it very simply, saying that lead generation "can make a small business a big business."

Before you can start generating leads, Hauge suggested starting with your strategy and business goals, and asking yourself the following questions:

  • Who are your potential customers?
  • What do they care about?
  • How will you measure success?

"Understand your audience and how your company can make their lives easier," Hauge added. "Start meaningful dialogue. Focus on building a relationship, not making a sale."

Goldberg said there are hundreds of ways to be successful in lead generation – and you need to do as many of them as you can effectively. Give yourself as many lines in the water as possible, he said, and allow the compounding to help create exponential growth.

"Any successful business owner, entrepreneur or executive is succeeding at lead generation. In fact, this is what is helping them create a pipeline of clients," Goldberg told Business News Daily. "The best are the ones who are curious, who experiment, who use trial-and-error, who A/B test, who don't get down on themselves, and who are persistent."

Hauge also said the key to generating good leads is understanding the needs and interests of your customers, and providing them with content that's relevant to them without coming across as someone "salesy."

If you are looking for tactics for lead generation, Goldberg advised that social media is a great way to go. Consistently posting on Instagram, Facebook and other channels such as email, drip campaigns, weekly newsletters, SEO and high-quality content are the best ways to drive traffic to your site.

Hauge said to offer something for nothing. The offering can vary depending on your business. For example, if you are a home-improvement contractor, offer a free design consultation. During the consultation, listen to your client's needs and respond accordingly – Hauge noted that good listeners are often the most successful at lead generation.

"Listening to a potential customer's needs and understanding them fully is the first step to having a real conversation and is a critical component of successful lead generation," he said.

Jennifer Post

Jennifer Post graduated from Rowan University in 2012 with a Bachelor's Degree in Journalism. Having worked in the food industry, print and online journalism, and marketing, she is now a freelance contributor for Business News Daily and Business.com. When she's not working, you will find her exploring her current town of Cape May, NJ or binge watching Pretty Little Liars for the 700th time.