(click to enlarge) Glenn Frantz is director of corporate communications for Draeger Medical Inc. (Telford, PA). Mike Drohan is president of Lead Generation Solutions (Wayne, PA), a company that specializes in lead qualification services.
In the competitive reality of today's market, it is critical for marketing executives to take advantage of every opportunity to make a sale. This is especially true for medical technology companies that spend hundreds of thousands of dollars annually exhibiting at trade shows. The only way to fully capitalize on the investment of personnel, time, and money that companies make in these events is to uncover every potential sale that is sparked by the exposure gained at the shows.
Draeger Medical Inc. (Telford, PA) recognizes the need to make the most of its trade show investment. Its parent company, Draeger Medical AG & Co. KG (Lübeck, Germany), is a division of Drägerwerk AG, an international leader in the medical and safety technology markets. In 2006, the company posted sales of EUR1.8 billion ($2.38 billion). That year, the company's revenue achieved a 15.7% increase in the American market alone, significantly ahead of the industry curve.
As part of its marketing strategy, Draeger has taken a calculated approach to its participation in the U.S. trade show arena. In addition to being selective about which shows it attends, and at what level, the company continually looks for ways to evaluate and quantify its investment and return in that forum. An integral part of Draeger's efforts to optimize its trade show appearances is ensuring its ability to follow up on the leads that its trade show presence generates. To accomplish this goal, Draeger has developed a telemarketing model that enables it to consistently follow up, qualify, and distribute trade show leads for its sales team.
Although many medtech marketing executives express confidence that their teams are making the most of their trade show leads, industry research indicates that nearly 80% of all trade show leads aren't followed up.1 Most companies do an excellent job preparing for shows and running their booths, but they are often unable to efficiently identify and engage all of their quality prospects in the wake of the event. Instead, companies cherry-pick a few surefire sales leads, permitting a lot of solid prospects to fall through the cracks. They end up losing sales opportunities and effectively handing them to their competition.
A Challenging Sales Environment
A strategic and immediate approach is vital for making trade show investments profitable. Thorough and timely follow-up on every opportunity is especially critical in the medical device arena, where the industry's rapid growth creates increasingly cutthroat competition.
Medical device companies face several specific challenges when they exhibit at a trade show. Targeting hospital management and clinicians creates a complex selling environment. The sheer number of hospitals alone makes it difficult for an account manager to reach every decision maker, and this challenge is made more difficult by the variety of personnel and internal processes that must be navigated on a case-by-case basis.
Overriding all these challenges is the simple fact that trade show leads are perishable, with a very limited period during which they're ripe for the picking. Companies need to have the bandwidth to handle both the breadth and the depth of the leads they're getting from a show, but their sales forces' time and resources are often limited. To combat such challenges, Draeger Medical has implemented a strategy that enables it to maintain a quick turnaround time on virtually all of the leads it generates at any given trade show.
In October 2005, Draeger's executive marketing team decided to focus on maximizing efficiency in trade shows by using telemarketing to qualify show inquiries and leads. The goal was to ensure that sales representatives would not have to spend valuable sales time making calls to leads that had little buying interest or who were not decision makers. At the same time, Draeger sought to fully capitalize on its investment in creating personal discussions at its trade show booth, and lead follow-up qualification was one way to help do that. After all, developing and maintaining consumer relationships is key in an industry like healthcare.
In outsourcing the telemarketing for its trade show follow-ups, Draeger is able to establish a timely dialogue between the company and its prospects, thereby maintaining valuable conversations that begin at its booth. However, using an outsourced partner to make the initial follow-up contact enables in-house sales rep- resentatives to focus their time on relationships that are qualified sales opportunities.
Expanding the Team
Nearly all of Draeger's outsourced follow-up marketing activity occurs on the phone. Every prospect reached through trade show activities is called, and representatives at Draeger's telemarketing partner firm navigate their way through the company's phone chain to gauge sales potential and interest.
Preparation for such follow-up calls occurs prior to the trade show itself. Before the show takes place, Draeger meets with representatives from its telemarketing partner firm to discuss the focus of the trade show. The discussion focuses on the new products and features that are being showcased at the event, as well as the best approaches for engaging the various levels of decision makers that are expected to stop by the booth. From this initial discussion, a marketing strategy is created to provide the telemarketing team with everything it needs to know to have the most effective conversations possible with the prospects. This advance preparation also enables the follow-up call team to step into action immediately after the show.
Draeger uses its telemarketing firm as an extension of its own marketing team. Together, the firms review key motivating factors for sales prospects in order to adjust the telemarketer's message and qualifying questions so that they match the level of decision maker being contacted. These discussions enable representatives at the partner firm to uncover genuine opportunities by engaging and motivating decision makers to take action and meet with a Draeger account manager. In the meantime, Draeger's in-house sales account managers can focus on the best opportunities first.
Many trade show leads express interest in Draeger's offerings. But often the need to meet with an account manager is not urgent, or the company's budget for such purchases is not yet available. Thus, account managers can waste time in trying to follow up on a trade show meeting before the prospect is ready. However, the manager risks losing the opportunity to the competition if he or she waits too long. By working through its telemarketing partner, Draeger optimizes the time of its sales team by gathering information that not only qualifies the needs of prospects, but also prioritizes the prospects with regard to their particular buying and budget cycle. With the information gathered by its telemarketing firm, Draeger account managers know the most effective time to follow up on each given prospect.
Furthermore, sometimes an organization with significant sales potential stops by Draeger's boothbut not in the form of the ultimate decision maker. Trying to penetrate further to reach the right decision maker can be difficult. And more importantly, it is time-consuming for a sales team. However, outside representatives are able to commit the time required to navigate beyond the person who stopped by the booth and reach the contact with whom a sales rep needs to be speaking. Thus, the Draeger sales team doesn't have to spend time with unqualified prospects.
Draeger first tested its new trade show follow-up strategy in December 2005 at the American Association of Respiratory Care show, and the company saw immediate results. Draeger contracted with an outside firm to call all leads that the sales account managers did not cherry-pick as being the most promising. In its follow-up calls, the telemarketing team found that approximately 13% of these seemingly low-priority leads were, in fact, hot prospectsthose that were ready to buy. An additional 16% of the leads were considered quality prospects, or those interested in receiving information and speaking with a representative, but not necessarily in a position to make an immediate purchase.
Throughout 2006, Draeger worked with the same outsourcing firm on more than 20 separate projects, the vast majority of which were related to trade shows. For each project, the outsourcing team worked closely with Draeger representatives to ensure a seamless handoff between the two teams. At the end of the year, the collaboration's success was apparent in the number of hot and quality leads that were generated. Approximately 15% of the year's leads were hot ones, while an additional 20% had been interested in receiving information and speaking with a representative. To date, Draeger's 2007 trade show results are on track to show improvement over 2006 figures.
The advantages of Draeger's new strategy extend beyond what is revealed in the postcampaign data. Obviously, following up on virtually all of its trade show leads puts the company at a distinct advantage over the industry average of 20% follow-up. But significant value also lies in the effective leveraging of the time of Draeger's sales force. Because every lead is graded on quality and potential, account managers now spend more time focused on real sales opportunities and closing deals rather than wasting time chasing down leads and prospects that don't qualify.
Recently, Draeger has begun focusing efforts on tracking and analyzing trade shows to measure long-term results, which will enable the company to make better decisions as to where it gets the best return on its trade show investment. For this effort, the company is working with its outsourcing firm to analyze the leads generated at each show. By recording each prospect's different needs in a database that Draeger can manipulate by trade show, region, account manager, and product, Draeger can more effectively align its account managers to respond to customer needs. It also enables management to see feedback at the individual customer level concerning specific product lines.
Reaching and motivating the right decision makers at a healthcare institutionparticularly when contact is established on a bustling trade show flooris a significant challenge for medical device manufacturers. Understanding such challenges and recognizing opportunities to improve a company's trade show efforts is key to success. To date, Draeger Medical has been pleased with the breadth and depth of information that its new strategy for trade show follow-up has produced for its sales team. Despite the flurry of activity that a trade show creates, Draeger's process ensures greater productivity in its sales team's efforts, eliminates lost opportunities, and enables the company to stay a step ahead of competitors.
1. B Siskind, Planning for Follow-UpAhead of Time, Guru Report G403 (Chicago: Center for Exhibition Industry Research, 2003).